Author Archives: TheAcsMan

Daily Market Update – August 10, 2016 (Close)

Yesterday and Monday both started the week very quietly and the futures this morning seemed as if they were going to carry on with that tradition of the past week.

And once again, they did.

Things may change in a big way if retail earnings start coming in and are surprisingly strong or surprisingly weak. Last week’s Employment Situation Report gave interest rate hawks a little more to believe in, but the GDP was an argument in favor of the other side.

This week, as retailers begin to report and as Retail Sales data is released on Friday, we can either find validation for the hawks or another nail in the coffin for those betting on an interest rate hike coming in 2016, which is rapidly coming to its end.

Otherwise, once the retail reports are in, there won’t be very much left in this earnings season to move markets and so we’re back to an FOMC watch as meandering economic data comes in and everyone gets back to work on fiscal policy once Labor Day has come and gone.

With a single expiring position this week that happens to be a short put position that also goes ex-dividend on Monday, I actually wouldn’t mind being assigned the position, even as the dividend is a paltry one. Because of that dividend, I don’t have too much interest in rolling the position over, unless the net from the rollover is still going to be 1% or higher.

In that case, it may be worth giving up on the dividend and continuing to collect the premiums on the position.

Either way, it would be nice to either milk that position for even more or at least get some cash out of the position through assignment, as long as there’s an opportunity to recycle it somewhere.

Right now, those opportunities seem slight, though.

It’s pretty sad when the most exciting thing for the week may end up being whether to consider rolling over a position that goes ex-dividend tomorrow in order to either get more premium in exchange for early assignment or simply add to the accumulation of premium while still getting that dividend.

But that’s all today was expected to bring and at least in that regard it didn’t disappoint.

With an opportunity, or even a need to roll over that position in International Paper, now I actually hope that it does get assigned early, but I’m not counting on it.

Going forward another month with a new expiration date in exchange for 1.3% in premium in exchange for possibly giving up a 1% dividend would be worth it if assigned tomorrow. Even if not, I wouldn’t mind rolling up more premiums in the position if having to take it beyond the September expiration.

Longer term is becoming the name of the game.

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Daily Market Update – August 10, 2016 (Close)

Yesterday and Monday both started the week very quietly and the futures this morning seem as if they’re going to carry on with that tradition of the past week.

Tings may change in a big way if retail earnings start coming in and are surprisingly strong or surprisingly weak. Last week’s Employment Situation Report gave interest rate hawks a little more to believe in, but the GDP was an argument in favor of the other side.

This week, as retailers begin to report and as Retail Sales data is released on Friday, we can either find validation for the hawks or another nail in the coffin for those betting on an interest rate hike coming in 2016, which is rapidly coming to its end.

Otherwise, once the retail reports are in, there won’t be very much left in this earnings season to move markets and so we’re back to an FOMC watch as meandering economic data comes in and everyone gets back to work on fiscal policy once Labor Day has come and gone.

With a single expiring position this week that happens to be a short put position that also goes ex-dividend on Monday, I actually wouldn’t mind being assigned the position, even as the dividend is a paltry one. Because of that dividend, I don’t have too much interest in rolling the position over, unless the net from the rollover is still going to be 1% or higher.

In that case, it may be worth giving up on the dividend and continuing to collect the premiums on the position.

Either way, it would be nice to either milk that position for even more or at least get some cash out of the position through assignment, as long as there’s an opportunity to recycle it somewhere.

Right now, those opportunities seem slight, though.

It’s pretty sad when the most exciting thing for the week may end up being whether to consider rolling over a position that goes ex-dividend tomorrow in order to either get more premium in exchange for early assignment or simply add to the accumulation of premium while still getting that dividend.

But that’s all today may bring.

.

Daily Market Update – August 9, 2016 (Close)

Yesterday started the week very quietly and the futures this morning seemed as if they’re going to carry on with that tradition of the past day.

They did.

Later in the week things may change a bit as retail earnings start coming in and will continue into next week.

Otherwise, just as the paucity of Federal Reserve Governor appearances would indicate, it will be another quiet week on the news front.

Yesterday was interesting in that the previous few days there had seemed to be a conscious re-coupling between energy prices and stocks.

Not so yesterday, though.

Despite a rally in the energy sector, stocks didn’t follow.

Stocks really didn’t do much of anything.

It was one of those days that there wasn’t even a glimmer of a hope that I would get any trade done.

On most days, unless there is a strong shift downward, at least something may look as if there’s an opportunity for a sale of a call on an uncovered position. Not that those trades get made often enough, but at least there’s some consideration of making a trade on something.

Not so yesterday and not so today.

I didn’t send out a single trial balloon trade on either day. There was that little movement across the board.

This morning’s futures weren’t pointing toward anything different, but I was ready and motivated to get something done.

I just wasn’t able.

So now it’s just one day closer to this easily being a repeat of last week, with only a single trade to show for 5 days.

Even if net assets increase during the week I don’t really look at that as a success unless I can wring some cash out of the week and last week was as minimal of a success at doing that as can be the case, unless you also count this week.

Maybe tomorrow?

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Daily Market Update – August 9, 2016 (7:30 AM)

Yesterday started the week very quietly and the futures this morning seems as if they’re going to carry on with that tradition of the past day.

Later in the week things may change a bit as retail earnings start coming in and will continue into next week.

Otherwise, just as the paucity of Federal Reserve Governor appearances would indicate, it will be another quiet week on the news front.

Yesterday was interesting in that the previous few days there had seemed to be a conscious re-coupling between energy prices and stocks.

Not so yesterday, though.

Despite a rally in the energy sector, stocks didn’t follow.

Stocks really didn’t do much of anything.

It was one of those days that there wasn’t even a glimmer of a hope that I would get any trade done.

On most day, unless there is a strong shift downward, at least something may look as if there’s an opportunity for a sale of a call on an uncovered position. Not that those trades get made often enough, but at least there’s some consideration of making a trade on something.

Not so yesterday.

I didn’t send out a single trial balloon trade. There was that little movement across the board.

This morning’s futures may not be pointing toward anything different, but I’m ready and motivated to get something done.

Otherwise, this could easily be a repeat f last week, with only a single trade to show for 5 days.

Even if net assets increase during the week I don’t really look at that as a success unless I can wring some cash out of the week and last week was as minimal of a success at doing that as can be the case, unless you also count this week.

Maybe tomorrow?

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Daily Market Update – August 8, 2016 (Close)

Last week ended on a really high note, but didn’t do too much to change the overall tone of the week, despite the market finishing at another record high.

All of that sounds a little contradictory, but the week was still one of ennui, despite the week ending Employment Situation Report.

With retailers beginning to report their earnings this week, it remains to be seen whether the consumer is really coming alive and whether they will serve as the catalyst that will really give the FOMC a reason to raise interest rates.

Markets generally agreed on Friday that it was time for those rates to go higher.

But while they’re increasingly comfortable with the idea, there still has to be the kind of data that supports an increase.

That wasn’t the case back in December 2015, when the FOMC very likely mis-read the future prospects of the economy.

With abysmal GDP numbers it would really help the FOMC out quite a bit if national retailers had something good to say.

Even if they have nothing good to report for the quarter just passed, if only they could find the silver lining heading into the final half of 2016.

I don’t have too much cash to invest this week and only have a single position expiring and 2 ex-dividend positions.

That combination would make me want to seek out some opportunity, but after Friday’s strong move higher it really awaits to be seen if there’s anything left at the moment.

Futures this morning seemed to suggest that we’re back to the listless trading that characterized most of the past 2 weeks in which the market had a consecutive losing streak while not really going down very much.

I’m likely to again be an observer, as much as I would like to open some new positions and that may again be the case tomorrow as the market stayed flat all throughout the session.

For those short the Marathon Oil puts, the company is ex-dividend next Monday.

For that reason, if faced with an assignment, I’m probably going to be more willing to take assignment rather than to roll it over, unless it’s very close to the strike.

In that case, the enhanced premium from rolling over of a volatile position may exceed the value of the dividend.

Otherwise, as is always the case, I would welcome the opportunity to sell calls on some uncovered positions and some more are within the price range where it may become possible, even as volatility is so very low.

Maybe tomorrow.

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