Option to Profit
Week in Review
|NEW POSITIONS/STO||NEW STO||ROLLOVERS||CALLS ASSIGNED/PUTS EXPIRED||CALLS EXPIRED/PUTS ASSIGNED||CLOSED|
|2 / 0||3||5||0 / 0||2 / 0||0|
Weekly Up to Date Performance
May 4 – 8, 2015
Now I really understand the meaning of “TGIF” after two consecutive week rescuing Fridays.
This then turned out to be yet another nice week, although like most weeks, there’s always something that could have been better.
Again, it was the lack of assignments, but this time there were also some expired positions that couldn’t be rolled over. It’s been a while since that has been the case, although that’s something easy to get used to.
New positions opened for the week beat the adjusted and unadjusted S&P 500 by 2.1%.
New positions gained 2.5% for the week. The unadjusted and adjusted S&P 500, despite Friday’s nice gain, barely ended the week having broken even, up just 0.4%.
This week the performance of existing positions was well distributed, rather than being highly concentrated in a few stocks or a single sector, such as energy stocks.
There were no assignments this week so the closed position statistics remained unchanged. The lots closed in 2015 continue to out-perform the market. They are an average of 5.5% higher, while the comparable time adjusted S&P 500 average performance has been 1.6% higher. That 3.9% difference represents a 253.9% performance differential.
As with the previous week this was another in a string of satisfying weeks, although again it could have been made much better if there had been some assignments.
As with last week, that means that there will be less likelihood of being very active in opening new positions in the next week and, therefore requiring greater need to be able to rollover existing positions or to be able to sell new call options on existing uncovered positions.
With the monthly cycle coming to its end next week, there are already enough candidates in the mix that could potentially give the combination of rollovers and assignments that has been elusive the past couple of weeks.
WIth nothing really going on for the week everything was bottled up awaiting today’s Employment Situation Report. p>
The only possible report that could have done what it ended up doing was one that was neither too good nor too bad.
This one was right in the middle and could leave no one disappointed, nor elated. That way there’s less reason to believe that interest rates will increase and less reason to think that the economy has stopped growing.
At least that’s the story that everyone will go with.
With a real back and forth all week the market has had a hard time sticking with a single personality, although there’s not too much doubt that the bias continues to be upward. If you try, you know that it’s really hard to fight the current or go against the tape.
As volatility continues to fall, the contrarian, as well as the technician, may be in agreement that it is being set up for a strong move higher.
On the one hand you could wait for that and the higher premiums or sell options now at lower premiums.
The risk is that waiting and being right may also mean losing the chance of getting a strike price that you’re comfortable with having sold.
That’s why I’ve started looking at some longer term expirations, even having gone as far out as September 2015 with some of today’s sales and August 2015, previously.
If wrong about a correction impending, the use of well out of the money strikes will at least allow the possibility of some share appreciation if assigned. If right, well, at least there’s some premium to soften the blow a little.
With next week being the end of the monthly cycle and with lots of positions set to expire and very little cash reserve to make new purchases, I’m hopeful that the market will create opportunities to next to either make money from existing positions or at the very least allow those positions to switch allegiances and head into the cash reserve pile.
With the market closing the week less than 0.2% from its all time highs, next week is actually a potentially market moving one, despite the general lack of economic news. What will be happening, though, is the earnings reports from the large national retailers that may have to be reconciled one way or another with next Wednesday’s retail Sales Report, as well.
Hopefully the news will be good, but not too good, so that we can get through next week and see those assignments and rollovers go through as I would love to have it scripted..
(Note: Duplicate mention of positions reflects different priced lots):
New Positions Opened: ANF, CY
Puts Closed in order to take profits: none
Calls Rolled over, taking profits, into the next weekly cycle: ANF, TWTR (puts)
Calls Rolled over, taking profits, into extended weekly cycle: AZN (6/12), GDX (5/22)
Calls Rolled over, taking profits, into the monthly cycle: none
Calls Rolled Over, taking profits, into a future monthly cycle: GDX (6/19)
Calls Rolled Up, taking net profits into same cycle: none
New STO: BAC (6/19), HFC (9/18), HFC (p/18)
Put contracts expired: none
Put contracts rolled over: none
Long term call contracts sold: none
Calls Assigned: none
Calls Expired: LVS, WFM
Puts Assigned: none
Stock positions Closed to take profits: none
Stock positions Closed to take losses: none
Calls Closed to Take Profits: none
Ex-dividend Positions: BP (5/6 $0.60), INTC (5/5 $0.24)
Ex-dividend Positions Next Week: none
For the coming week the existing positions have lots that still require the sale of contracts: AGQ, ANF, CHK, CLF, FAST, FCX, HA, .INTC, JCP, JOY, LVS, MCP, MOS, NEM, RIG, WFM, WLT (See “Weekly Performance” spreadsheet or PDF file)
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