Weekly Performance Review (up 3.95%)
I also should be more selective about when I use spreads for especially what I plan to be short term plays. I need to study that more and find my optimum sweet spot there.
It's easy to beat myself up over the plays the went bad.... but, you win some you lose some... and the reason I try to diversify is to protect against that. Hopefully, I just pick more winners than losers and continue eeking out a profit each week.
I'm not quite to my first goal to make a withdrawal, but I'm edging closer, maybe in a week or two - I plan to make my first withdrawal either 100% or 125% of my initial capital of the year, when I do.
As for next week, it looks like I'm too late to hop on the Lions Gate Films Hunger Games train after the bump today, but if it dips, I'm in. I expect that to be a huge win for this relatively small film shop.
Will also continue watching APPL, look for a casino play in perhaps WYNN or more likely LVS. MT will be watched again I'm sure, as well as OPEN. If LULU stalls I might try a small put play - I just think they are way, way overvalued but its hard to bet against the trend there. AMZN doesn't look to bad for a small call play either, especially if they dip to mid $170s. Will do some research this weekend and try to come up with some gold somewhere...
This week's Activity:
UAL - I purchased March $21/$22 call spread for $0.60, and when the stock dipped due to rising fuel costs, I sold these the next day for $0.45 at a 25% loss. UAL had a nice run-up recently and I was afraid they continue giving that up the rest of the week and bailed ship. It ended up being a great move to get out when I did, as UAL did exactly that the rest of the week.
SDS - Not even sure what compelled me to buy this, so that's probably mistake #1 here. I bought some weekly $16 calls for 35 cents, and sold them for 29 cents, for a 17% loss.
MT - I'm still long term bullish on MT, but my MAR $21/$22 call spread didnt seem too appealing to me when they dipped Wednesday. didn't lose a whole lot more than commissions on this trade though.
CHTP - I bought in on Tuesday, when the stock "tanked" on some poor news. This is a play where the bid/ask spread just killed me when I bought my options, and not doing any due diligence at all when I bought, or when I sold, I took my lumps with a 60% loss on this silly trade of mine. Of course CHTP got some favorable news Thursday, so this would have actually turned into a double for me had I held on.... what was I thinking all around here? I have no clue...
BAC - I was expecting BAC to continue a bit of their rise, and but my $8.00 weekly calls just lost value when the stock didn't move, another 36% loss.
SHLD - I was pretty damn sure Sears would completely miss their earnings estimates, which they did. I was also pretty sure they would be spinning off or selling some of their stores, which they did. What I did not expect was the stock to rise after those things happening.... I think the writing is on the wall for Sears and they will soon be gone. I suppose their saving grace is their book value, they can still sell alot of assets to pay the bills for awhile. I lost 100% of the put $52.50/$50.00 put spread, and the $45.00 puts I bought. Ugh.
AAPL - So after all that ugliness I was down 40% on the week. What do I do, pile on more Apple of course!!! I already had a few weekly $510/$515 call spreads, and I was able to add to them at about the same price. AAPL didn't dissapoint and rose very nicely by the end of the week, returning me a profit of 70.86% on this play that brought me entirely back into the black for the week, and up a few percentage points even!
AAPL April Butterfly purchased $500 and $540 calls, while selling twice as many $520 calls. Which pretty much means I need AAPL to go sideways until then, I'm not convinced it's going to happen, but not too turned off to dump this yet.
Week Over Week Return: 3.95%
YTD Return: +292.4%
Good Luck & Happy Trading!
Edited by stangracin at 02/24/12 at 06:36 PM