What a volatile month! For Mar's play, new covered calls positions on STLD & GG were placed. The options expired worthless & secondary calls will be written of course. As for the other positions such as Dell, NVDA, CSCO, INTC, their share prices are below their original purchase price & have fallen even lower after the Shanghai surprise. Their respective call options were bought back profitably when the market rebounded & new LEAPs call options written to generate additional income. As of Friday Mar 16, the LEAPs calls can be bought back profitably because stock prices have cycled down after the rebound. However, the LEAPs calls will only be bought back if the prices starts cycling up. Riding on the rebound, Mar 870 & 860 calls were written on ER2(Russell 2000 Index) to generate additional income. All the ER2 calls & puts expired worthless as the index closed at 778 on Friday. For April's play, as a start, new April ER2 600 puts(non-directional strategy) were written. On the other hand, being bearish biased, N225 (Nikkei 225 Index) April 19000 Calls were written too.
Friday, March 16, 2007
March Trades Review
What a volatile month! For Mar's play, new covered calls positions on STLD & GG were placed. The options expired worthless & secondary calls will be written of course. As for the other positions such as Dell, NVDA, CSCO, INTC, their share prices are below their original purchase price & have fallen even lower after the Shanghai surprise. Their respective call options were bought back profitably when the market rebounded & new LEAPs call options written to generate additional income. As of Friday Mar 16, the LEAPs calls can be bought back profitably because stock prices have cycled down after the rebound. However, the LEAPs calls will only be bought back if the prices starts cycling up. Riding on the rebound, Mar 870 & 860 calls were written on ER2(Russell 2000 Index) to generate additional income. All the ER2 calls & puts expired worthless as the index closed at 778 on Friday. For April's play, as a start, new April ER2 600 puts(non-directional strategy) were written. On the other hand, being bearish biased, N225 (Nikkei 225 Index) April 19000 Calls were written too.
Tuesday, February 20, 2007
February Trades Review
STLD got called out on Feb 16 as the stock continues its climb up strongly. Additonal gains were made on the stock as OTM calls were written. This is just great! Feb Options on DELL, CSCO, NVDA expired worthless. As the prices of these stocks has fallen below their initial purchase price, additional calls will be written & note that the stocks will never be sold for a loss. In addition, to maintain the monthly income stream of 3%-6%, Mar ER2 655 puts were written.
Sunday, January 28, 2007
January Trades Review
HPQ got called out on Jan 19 expiration day. Dell, INTC, CSCO & NVDA stock prices took a beating. In cases as such, secondary call options were written to close the gap & to continue to generate the 3%-6% income per month. STLD stock has risen 15% from purchase price. The STLD Jan options were bought back for a profit & subsequently, Feb options were sold to continue to generate income while riding the stock up.
Friday, January 5, 2007
January 2007 Trades
For a start, my covered call plays for 2007 are against the following stocks:
CSCO
INTC
HPQ
NVDA
DELL
STLD
Traditional thinking is that the Covered Call Strategy works best for bullish to neutral stocks. Yes, this is not wrong. However, since my intend is to derive regular income from my "Assets or Stocks" i.e to lock in a MONTHLY return of 3%-6% return on my stock investments, then it should not matter as much which direction the market is going. Think of it as having a property where you are perpectually renting out to collect monthly income....and during which, the value of your property may go up or down & you are not unduly worried. The only thing you don't want is the property to be swallowed by an Earthquake or be swept away by a Tornado & in which case, you have nothing to rent out against. In the case of covered calls, as long as the stock value is not zero and the company is still fundamentally sound, we can continue to "collect" rental income MONTHLY. But having said that, of course I still like the company to remain bullish in the long run so that we can have additional capital gains. Therefore stock selection is still important in this strategy. In fact, selecting fundamantally sound stocks with options premium that meet my 3%-6% monthly return criteria & when to "Sell to Open" & "Buy to Close" the options to maximise on the returns determines the success with the application of the Covered Call Strategy .
DO NOTE:The cash return are represented by real cash & not paper values that can disappear as quickly as they appear. These cash returns can be reinvested to dramatically compound the growth of a portfolio or be withdrawn & spent on whatever you desire.
CSCO
INTC
HPQ
NVDA
DELL
STLD
Traditional thinking is that the Covered Call Strategy works best for bullish to neutral stocks. Yes, this is not wrong. However, since my intend is to derive regular income from my "Assets or Stocks" i.e to lock in a MONTHLY return of 3%-6% return on my stock investments, then it should not matter as much which direction the market is going. Think of it as having a property where you are perpectually renting out to collect monthly income....and during which, the value of your property may go up or down & you are not unduly worried. The only thing you don't want is the property to be swallowed by an Earthquake or be swept away by a Tornado & in which case, you have nothing to rent out against. In the case of covered calls, as long as the stock value is not zero and the company is still fundamentally sound, we can continue to "collect" rental income MONTHLY. But having said that, of course I still like the company to remain bullish in the long run so that we can have additional capital gains. Therefore stock selection is still important in this strategy. In fact, selecting fundamantally sound stocks with options premium that meet my 3%-6% monthly return criteria & when to "Sell to Open" & "Buy to Close" the options to maximise on the returns determines the success with the application of the Covered Call Strategy .
DO NOTE:The cash return are represented by real cash & not paper values that can disappear as quickly as they appear. These cash returns can be reinvested to dramatically compound the growth of a portfolio or be withdrawn & spent on whatever you desire.
Saturday, December 23, 2006
Take Stock for 2006
Friends,
For sharing....a unique site http://www.briefing.com/Investor/Index.htm I have been using that provide ideas for investors/traders to knowledgeably manage their investment portfolio. I find it rather comprehensive. I hope this will be useful to you too.
Briefing.com's Investor service provides:
Page One - a one-place stop to "see" the overall market.
Market updates every half hour.
An Active Portfolio containing stock ideas for the long-term investor
Analysis of small, medium and large cap stocks
Bargain Hunting - an analysis of stocks with a value/contrarian orientation
The Big Picture - an analysis of major issues in the market
Ahead of the Curve - long-term investment ideas based on secular trends and unique business models.
An analysis of industry group performance.
Premium third-party content and applications.
Meanwhile, consider taking stock of 2006 & plan for 2007. Personally, I find that its better to have clarity & a plan going foward.
Wealthwise, I will continue to focus on generating 4%-6% monthly return for my account & managed funds. I will be employing a combination of low risk strategies that includes covered calls, calender on LEAPs, writing options on the Russell 2000. For savings & growth, I will be looking into long on certain Asia countries ETFs. I also plan to launch my own proprietary covered call strategy. Just dreams......
Merry Christmas & A Happy New Year!
For sharing....a unique site http://www.briefing.com/Investor/Index.htm I have been using that provide ideas for investors/traders to knowledgeably manage their investment portfolio. I find it rather comprehensive. I hope this will be useful to you too.
Briefing.com's Investor service provides:
Page One - a one-place stop to "see" the overall market.
Market updates every half hour.
An Active Portfolio containing stock ideas for the long-term investor
Analysis of small, medium and large cap stocks
Bargain Hunting - an analysis of stocks with a value/contrarian orientation
The Big Picture - an analysis of major issues in the market
Ahead of the Curve - long-term investment ideas based on secular trends and unique business models.
An analysis of industry group performance.
Premium third-party content and applications.
Meanwhile, consider taking stock of 2006 & plan for 2007. Personally, I find that its better to have clarity & a plan going foward.
Wealthwise, I will continue to focus on generating 4%-6% monthly return for my account & managed funds. I will be employing a combination of low risk strategies that includes covered calls, calender on LEAPs, writing options on the Russell 2000. For savings & growth, I will be looking into long on certain Asia countries ETFs. I also plan to launch my own proprietary covered call strategy. Just dreams......
Merry Christmas & A Happy New Year!
Saturday, December 16, 2006
Exchange Traded Funds (ETFs)
Dear friends, check out today's edition of the Sunday Time where there is a feature on ETFs..how some folks trade this investment instrument which has been around for a while but its becoming more & more favourable. It highlights the pros & cons of ETFs vs stocks or mutual funds or unit trust. With ETFs, one can easily participate in the different country's stock market or a certain asset class....which takes the chore out of stock picking.
Investors should spend most of their time on overall asset selection and ignore individual stocks for the most part. Repeated studies by unbiased university researchers have shown that about 95% of money managers' performance, for better or worse, can be explained by their selection of asset classes, not by their selection of individual stocks. When a stock performs well, invariably stocks from the same asset classes follow in parallel. All one has to do is pick asset classes well to outperform.
Asset allocation is not necessarily easy, but it is less detailed and time consuming than stock picking, and it rewards the diligent investor handsomely
The primary asset classes in which ETFs are available include:
Large Cap Stocks
Mid Cap Stocks
Small Cap Stocks
Growth Stocks
Value Stocks
Sector Stocks
International Stocks
Country
Emerging Market Stocks
Long-term Bonds
Mid-term Bonds
Short-term Bonds
Real Estate Investment Trusts
Investors should spend most of their time on overall asset selection and ignore individual stocks for the most part. Repeated studies by unbiased university researchers have shown that about 95% of money managers' performance, for better or worse, can be explained by their selection of asset classes, not by their selection of individual stocks. When a stock performs well, invariably stocks from the same asset classes follow in parallel. All one has to do is pick asset classes well to outperform.
Asset allocation is not necessarily easy, but it is less detailed and time consuming than stock picking, and it rewards the diligent investor handsomely
The primary asset classes in which ETFs are available include:
Large Cap Stocks
Mid Cap Stocks
Small Cap Stocks
Growth Stocks
Value Stocks
Sector Stocks
International Stocks
Country
Emerging Market Stocks
Long-term Bonds
Mid-term Bonds
Short-term Bonds
Real Estate Investment Trusts
Is Trading the Perfect Business? Go Figure
•No employee
•No inventory
•No selling of products to friends & family
•No billing
•No shipping
•No advertising cost
•No office to maintain
•Work anywhere where a computer or an internet connection is available
•You are autonomous and do not need to check in, ask permission, consult with or answer to anybody
•Very little time is required
•Very little capital is required
•Freedom
•No inventory
•No selling of products to friends & family
•No billing
•No shipping
•No advertising cost
•No office to maintain
•Work anywhere where a computer or an internet connection is available
•You are autonomous and do not need to check in, ask permission, consult with or answer to anybody
•Very little time is required
•Very little capital is required
•Freedom
Subscribe to:
Posts (Atom)