7/20 – Expiration friday

The markets have pulled hard off their highs. What’s new? Not alot. Ewwww, GOOG announced there earnings were .03 off of expectations, CAT didn’t make it. So the SP closed down 19, the DOW off 157. The SP stays above it’s 50 MA and bounce on a 38% retracement. Monday will be interesting. The Stock Almanac suggests a historically bearish day. It said the same of friday. In fact, the 2007 Stock Trader’s Almanac has been right on the historically significant bullish and bearish days since June 20th. Interesting.

I reshuffled a bit today.
FITB – I closed out this position for a full loss. It was a .05 trade gone wrong. I only lost on 1 unit. It never really moved in my direction the entire trade, so I didn’t add to the position. Thanks Jesse Livermore.
SPF – I have 2 units of this stock on, and I rolled my July 20p into a Aug 17.5p Dynamic Hedge when SPF was @ 17.59. I would love to see this rally for a little.
DTV – 1 unit Aug/Sept 25p Calendar for .17. There is a 4:1 reward to risk ratio on this. Front month Vol is about 4.5% high. The more I look at this trade, the more I like it. I especially like the support of the converging 50 and 200 MA. If the underlying drops further, and the spread tightens I will put a full allocation on this trade. It reminds me of the EK trade a while back. The change would have made on the EK trade is to also add in a long call to hedge to the upside.

CREE – Exited 1 unit of the Jan/Dec 25p for .25. This entire trade has been nice. The remainder of this trade is a risk free trade. The initial position and the 2 directional hedge have all made 125+%. It is not everyday that I find a trade like this, but when I do I will fill it to full allocation (5% of my portfolio). The key for me – I would hate to see a total loss in the position, but it wouldn’t stop me looking objectively for a new trade.
MFE – I initiated a 35p Calendar in MFE. I am still accumulating it. I only have 1 unit on at this point. I want to see what happens on monday to look at the rest of the trade. I may create a circus tent for the underlying to play in. i.e. multiple calendars to hedge price movement with the increased front month vol, or sept OTM call.
AMT – I am still bullish on this stock, but I did sell 1 unit of the Jan 45c-50c for 2.20. A modest 17% gain, but it only had a 26 delta. I am doing this to free up capital for a higher Delta, or positive theta trade. Perhaps a Bull Put spread if there is an uptick in volatility, or a Oct 40 – 50c spread (Delta=+63/spread) (when this gets above 46 it turns theta positive)
Fun and play with the TOS Monkey