Sold 5 Puts to Open, Stock Symbol FLR Strike Price 30. Bringing in $125(before Commissions into my account).While Fluor is an engineering and infrastructure company, I believe that because it, with the rest of the market, has come way off of it highs can benefit from an Obama Presidency of building infrastructure to make work during what I consider the New Obama Dream Deal for Americans laborers. Plus the stock is currently trading at 42+, so either it withdraws another 12+ points in the next 12 days or I keep the money that I brought in as a premium. Either way, I'm happy. I used to own this stock and sold it into the bull market a couple of years back, it was a late player to the table of the last bull market, but since there seems to be a plan to build infrastructure to create jobs, I'm finding that this stock may benefit even during the recession, we'll have to wait an see.
Sold 5 Puts to Open, Stock Symbol "MT" Strike Price 17.5 Bringing in $125 (before Commissions into my account). While this is a steel company, I did this trade for the same reason as the above trade. This stock is currently trading at 24.50, so it has to retreat a long way in the next 12 day for me to be put and own the stock at $17.50, Which I would do, but only time will tell.
Flipped 40,000 shares of F Paid $1.94 sold within a few minutes for $1.95 bringing into my account a gross of $400.00 (less commission). This is a simple day -trade flip for an extra $400 while I'm looking for more stocks that I would like to own and to sell puts against.
Last week I sold 7 puts on CSH with the strike of 30 today I sold another 7 put options on the 25 strike at .55 bringing into my account $385 (Before Commissions), A material Item has changed since I put my original position which I believe may have a material impact on its earnings short term. As I understand it, through legislation, they lost their ability to do payday type loans in some states but they are still going to pawn, which is profitable but not as profitable as the payday loan business (as you can imagine). I still like this stock but I sold the 30 Puts and the stock is trading in the 29.40ish range where there is some technical support down to at approx 28.45, but I still want to own this stock because they are trying to buy the biggest privately owned Pawn Shop chain in Mexico. If that deal happens their earnings should rise and so should their stock accordingly. But my shorter term view has been shaken and therefore I have an order in to sell 7 of the current month 25 strike puts at .25.
"
Fort Worth, Texas (September 29, 2008) - - Cash America International, Inc. (NYSE: CSH) announced today that it has entered into a letter of intent to acquire an 80% ownership interest in a 100 store chain of pawnshops in Mexico.
My thought process is that if the stock goes all the way that low, then it is way oversold and I'd average down my buying price on the stock at 27.5, however, I'm not that convinced that this stock wont rally before expiration day back towards 32.5 -35, leaving me with just option premium in my account and no stock. Whether I get put at 30, and 25 strikes or just at 30 strike, I plan to sell cover calls at the money for the short term and then if the stock doesn't get called away to sell out of the money calls for the next couple of months or until the Mexico deal comes through. As time goes by, and if the Mexico deal gets done, then I won't even sell calls as I'll wait for the earnings to pick up and hold this stock for another year or two during the recession. But we'll have to see if I even get put the 30's or if this was the sell off and the stock heads back up from here. I believe that once the Mexico acquisition is finalized we will finally see the upswing that it's competitor "EZPW" has already seen trading at 14.5 P/E vs. CSH which is currently trading at only 9 times its P/E.
Bought Calls to Open 10 Google 320 Strike @ 12.80 and turned around and offered them out and sold them for $13.00 credit my account $200.00 No position, just a trade that was there. It seems that with all of the trading on google today that it had found a temporary trading range of 310-312, so I took advantage by buying on the bid and selling on the offer one of the highest volume current month option calls that were trading. Turning it right around and selling it for a $200 profit. I'll watch the stock some more and maybe do it again if the opportunity arises. Could have held it with the big sell of in google as it may rebound, but with the market weakness, I didn't feel comfortable holding it any longer than was absolutely necessary to turn a profit. Never let greed overcome good judgement is what I told myself at the time of the trade. I have to dedicate this trade to "Yama Sushi on the Lake" The Best Sushi Bar in Orange County California, as I like Sushi and took my wife there last night. The bill came to $192 with tip and drinks, and I had quite a few drinks. Therefore, this trade is dedicated to them, as it paid for the dinner and I was thinking while eating and drinking that I would do a trade today to pay for it.
Thank You Yama Sushi on the Lake
The reason That I'm thanking them is, if it weren't for dinner last night, I wouldn't have been looking for a quick in and out trade, but because of the quality Sushi that they have, I had to eat there an that forced me to look for the Google trade, so when I saw the stock stall at a new range between $313-$315 I had to make another flip trade and here's how it went:
Sold to open 10 Google 320 Strike calls at 13.70 on the offer and within a minute placed an order to buy it back on the bid at 13.40 putting a $300 Profit in my account. (Before Commissions) So now I didn't just pay for a The Best Japanese Food in Orange County, but I'm up $300 to boot. I wouldn't have even looked for this trade if I didn't feel that I wanted to do a quick flip to pay for dinner, but once I found the trade, I had to stay with it just a little while to see if there would be another opportunity, where the stock moved, but then stalled in another trading range and when that happened, I did it once, more. I probably will not do the trade again today unless while I'm watching it, the stock first makes a move and then stalls again. I'll let you know, but for now, anyone of you that watch my blog real time, and have a computer, the symbol for this particular option and strike is GGDKD. have fun watching and wish me luck!
Monday, November 10, 2008
Friday, November 7, 2008
Had a few Naked Option Orders in But nothing done
When the market is going up, it's hard to find the puts that are a good sale, especially current month as the premiums are starting to drop off at an accelerated pace. I say this because I know that most of you look at my options trades. Had I of gotten filled on the option put orders that I had in, I would have been happy, but like the title of this blog states - Stock and Options Trading, so if I couldn't get any option position trades off, there are no stocks that I want to own at current prices because I believe right down to my core that there will be more sell offs and cheaper prices.
So I did what anyone in my position would do, I found a way to make $600 regardless, just buy day - trading a high volume stock and limiting my risk by being in and out within a couple of minutes on each trade - My trading rules # 167 -Never hold a stock that you don't want to own. I have about 620 rules of trading that I always follow, and I never deviate from them. Some of those rules only apply to certain types of trading, for day trading I have about 18 rules to follow and I used those rules today. That's another reason I keep a diary, to add to my rules when I make an error.
Could I have made more on those trades? Well the answer, in hindsight, ended up being yes, but if it is not a stock that I want to hold medium or long term , then it's not a stock that I want to hold for more than two minutes, maybe three minutes at the most and that's what I did. I always stick to my own set of trading rules that have worked for me for years and I do not stray from those rules, as I never want to be in a position of hoping and wishing. I learned those lessons long ago.
I played it the correct way that I trade and even though I could have made more by holding the stock to the close, that would have went against my rules and in the long run it would hurt me. It's a slippery slope when you allow yourself to NOT FOLLOW your own set of trading rules! As I will never let greed overcome good judgement!
Whether you followed my trades or stayed on the sidelines, I hope you didn't take the opposite side as you will be down on the day and usually I believe that taking the opposite side of my trades is a good recipe to lose money, but you make your own judgement regarding that. Its your money you are trading with, not mine.
Below, Check out my Post on Options Trading "Tips & Tricks"
So I did what anyone in my position would do, I found a way to make $600 regardless, just buy day - trading a high volume stock and limiting my risk by being in and out within a couple of minutes on each trade - My trading rules # 167 -Never hold a stock that you don't want to own. I have about 620 rules of trading that I always follow, and I never deviate from them. Some of those rules only apply to certain types of trading, for day trading I have about 18 rules to follow and I used those rules today. That's another reason I keep a diary, to add to my rules when I make an error.
Could I have made more on those trades? Well the answer, in hindsight, ended up being yes, but if it is not a stock that I want to hold medium or long term , then it's not a stock that I want to hold for more than two minutes, maybe three minutes at the most and that's what I did. I always stick to my own set of trading rules that have worked for me for years and I do not stray from those rules, as I never want to be in a position of hoping and wishing. I learned those lessons long ago.
I played it the correct way that I trade and even though I could have made more by holding the stock to the close, that would have went against my rules and in the long run it would hurt me. It's a slippery slope when you allow yourself to NOT FOLLOW your own set of trading rules! As I will never let greed overcome good judgement!
Whether you followed my trades or stayed on the sidelines, I hope you didn't take the opposite side as you will be down on the day and usually I believe that taking the opposite side of my trades is a good recipe to lose money, but you make your own judgement regarding that. Its your money you are trading with, not mine.
Below, Check out my Post on Options Trading "Tips & Tricks"
Same Trade as Below for a Little Less
Bought 20,000 shares F at 1.98 sold two minutes later at 1.99. Crediting my account $200 (before commissions). I can not emphasize enough that I really need a discount broker for this trading. Something like 5 or 10 per trade unlimited shares. I had offered it out at $2.00, but the stock ticked down so I offered it out @1.99 and sold it.
Flipped 20,000 Share of Ford
Bought and Sold 20,000 shares of F (Ford) Paid $1.93 and Sold at $1.95 crediting my account $400.00. (before commissions.) Since it's a little slow in the put market today because it's an up market, although I have some options orders in, none have been filled yet, I decided to watch a stock with tremendous volume so that I can flip it for a profit quickly and that was Ford. While I have no opinion on Ford I am always looking to make money, so why flip Ford instead of a different stock, what makes Ford so special for a quick flip? The way that It there are only two criteria needed to make a day trade
#1 Volume - The stock must have major volume so that you can buy and sell at lightning speed without concern of not being filled. Ford, as I am writing this has had 69+ million shares traded already today.
# 2 Price -Because the price has to be such that if you buy 20,000 shares, that you have the money for it. So I pick ford and waited for the momentum and traded in and out within two-three minutes.
On these type of stocks, if I have the time I'll watch and buy on the bid if I can, in this case the upward momentum was such that I first tried buying on the bid but it was rapidly disappearing so I took the offer and then waited, 2-3 minutes and sold it on the offer.
Now I'm back on the hunt for options
#1 Volume - The stock must have major volume so that you can buy and sell at lightning speed without concern of not being filled. Ford, as I am writing this has had 69+ million shares traded already today.
# 2 Price -Because the price has to be such that if you buy 20,000 shares, that you have the money for it. So I pick ford and waited for the momentum and traded in and out within two-three minutes.
On these type of stocks, if I have the time I'll watch and buy on the bid if I can, in this case the upward momentum was such that I first tried buying on the bid but it was rapidly disappearing so I took the offer and then waited, 2-3 minutes and sold it on the offer.
Now I'm back on the hunt for options
Thursday, November 6, 2008
Sign Up Now for Free Options "Tips and Tricks"
Folks,
This Newsletter is made up of the information and chronicles how I made my millions and I'm going to send it to you free. Why? Because I've already made the money and they changed some of the rules because of me. It makes for exciting reading in an otherwise quite boring financial white paper on options trading.
Yes, it is true. The option exchanges actually went to the SEC and ask for rule changes to protect themselves from my trading strategies (at the time I was for looking for mis-priced options). They did not go after me legally, because it was perfectly legal, but they changed the rules so that that I could not use that particular strategy anymore. That hasn't stopped me because I just come up with newer strategies designed for high percentage profits and at the end of the day, they have to trade or they can't make a living and just because I know the game, they cannot disallow me from trading... "It's a thing of beauty to behold".
Once, (and this story is in the newsletter) an Irish guy from Chicago was working on the floor of the CBOE and had my order to execute against a published quote in his hand. The options specialist saw that I caught him with an option that was way undervalued and my floor broker went to buy it, but the specialist trading that option tried to back away from his quote saying that "his computer must be malfunctioning" or something (he was asleep at the wheel and maybe even had a hangover) and I caught him sleeping. When he tried to back out of the trade - this young Irishman didn't like that at all and he , after all he considered himself a tough guy that worked his way up, coming from the streets of Chicago and no-one was going to get one over on him and after-all, what the specialist was trying to do was against the rules. If you post a quote, you must stick by it (especially for a public customers order and only a 10 lot) a 10 lot is options-floorspeak meaning ten contracts. Anyway, to make a long story short it broke out into a bar room brawl, right there on the floor of the CBOE!
The next thing you know I look up at the NYSE News Ticker "Fight Breaks Out on the Floor of the CBOE" it reads! Wow that was my trade. I received a phone call from my broker explaining what had happened and I was asked whether or not I felt that the Irishman should go back in and keep fighting (as there was a break in the action to phone the client). I said "NO! stop the fighting" as we can lose this battle but we'll win the war! And so we did just that, every time I found an over or under valued option, I would slam a 10 lot down his throat for the next three to four weeks, unrelenting in the pressure since he had backed away. He must have gone to the bar everyday after work just to let off steam or to stare at the bottom of his scotch glass wishing this wasn't happening to him.
My point is that trading options is a tough business, sometime literally, but mostly its simple math. The specialists that you are trading against are ruthless and want to win, that is how they make a living and many times it is you against them - so be prepared for battle when you go in and do not let up, as options floor traders are notorious for trying to stick you with a losing trade. It's not for the faint of heart and not for those who will acquiesce to getting a worse price, you need to fight for the price that you really deserve or they may RIP YOU OFF!
I've got current stories and strategies and some from the good old days when options trading was the wild west and the guy who had a computer for a brain with only one eye and I mean that literally, had walked around the floor of the Amex trading and using locked in arbitraging strategies like debit spreads for a credit or A-symmetrical butterfly spreads, still way underused, and he would walk away with millions per year and no-one could figure out what he was doing.
I've got that kind of experience and it is my pleasure to share it with you, so please sign up today for your free newsletter and let me help you to understand the way that I think. I think like a millionaire and it made me a millionaire - Shouldn't you?
If not, don't waste your time or mine because you wont get out of the newsletter what you should, you have to want to make millions to make them - Do you really want to? It really is that simple, do you want to make millions -Yes or No? If yes, get your free newsletter today and if no, you are on the wrong site.
thx...
The Options Trader
This Newsletter is made up of the information and chronicles how I made my millions and I'm going to send it to you free. Why? Because I've already made the money and they changed some of the rules because of me. It makes for exciting reading in an otherwise quite boring financial white paper on options trading.
Yes, it is true. The option exchanges actually went to the SEC and ask for rule changes to protect themselves from my trading strategies (at the time I was for looking for mis-priced options). They did not go after me legally, because it was perfectly legal, but they changed the rules so that that I could not use that particular strategy anymore. That hasn't stopped me because I just come up with newer strategies designed for high percentage profits and at the end of the day, they have to trade or they can't make a living and just because I know the game, they cannot disallow me from trading... "It's a thing of beauty to behold".
Once, (and this story is in the newsletter) an Irish guy from Chicago was working on the floor of the CBOE and had my order to execute against a published quote in his hand. The options specialist saw that I caught him with an option that was way undervalued and my floor broker went to buy it, but the specialist trading that option tried to back away from his quote saying that "his computer must be malfunctioning" or something (he was asleep at the wheel and maybe even had a hangover) and I caught him sleeping. When he tried to back out of the trade - this young Irishman didn't like that at all and he , after all he considered himself a tough guy that worked his way up, coming from the streets of Chicago and no-one was going to get one over on him and after-all, what the specialist was trying to do was against the rules. If you post a quote, you must stick by it (especially for a public customers order and only a 10 lot) a 10 lot is options-floorspeak meaning ten contracts. Anyway, to make a long story short it broke out into a bar room brawl, right there on the floor of the CBOE!
The next thing you know I look up at the NYSE News Ticker "Fight Breaks Out on the Floor of the CBOE" it reads! Wow that was my trade. I received a phone call from my broker explaining what had happened and I was asked whether or not I felt that the Irishman should go back in and keep fighting (as there was a break in the action to phone the client). I said "NO! stop the fighting" as we can lose this battle but we'll win the war! And so we did just that, every time I found an over or under valued option, I would slam a 10 lot down his throat for the next three to four weeks, unrelenting in the pressure since he had backed away. He must have gone to the bar everyday after work just to let off steam or to stare at the bottom of his scotch glass wishing this wasn't happening to him.
My point is that trading options is a tough business, sometime literally, but mostly its simple math. The specialists that you are trading against are ruthless and want to win, that is how they make a living and many times it is you against them - so be prepared for battle when you go in and do not let up, as options floor traders are notorious for trying to stick you with a losing trade. It's not for the faint of heart and not for those who will acquiesce to getting a worse price, you need to fight for the price that you really deserve or they may RIP YOU OFF!
I've got current stories and strategies and some from the good old days when options trading was the wild west and the guy who had a computer for a brain with only one eye and I mean that literally, had walked around the floor of the Amex trading and using locked in arbitraging strategies like debit spreads for a credit or A-symmetrical butterfly spreads, still way underused, and he would walk away with millions per year and no-one could figure out what he was doing.
I've got that kind of experience and it is my pleasure to share it with you, so please sign up today for your free newsletter and let me help you to understand the way that I think. I think like a millionaire and it made me a millionaire - Shouldn't you?
If not, don't waste your time or mine because you wont get out of the newsletter what you should, you have to want to make millions to make them - Do you really want to? It really is that simple, do you want to make millions -Yes or No? If yes, get your free newsletter today and if no, you are on the wrong site.
thx...
The Options Trader
Sold Puts to Open
Sold 9 puts, AES Dec 20th 5 strike at .20 bringing into my account $180 (gross before Commission) But why sell puts on energy stocks or energy infrastructure stocks when we all know they are going down? when a stock is cheap it is cheap at that's just a fact and I believe that this stock is too low. Because that is pure short term thinking.
Now that we've seen some of the sell off and we'll probably see more, I'm looking long term. Do you think that electricity will be necessary for developing countries to keep up with their demand in the future when things pick back up? I think so and thus they will need new power plants to produce energy for their constantly growing population that wants the middle class lifestyle and I don't see why the Developing countries shouldn't have what they want, it may be a while, but they will get there, to the promised land. On sale at a never again in this century seen price is Symbol AES IMHO, but many of hedge funds still have redemption's to do and this stock may go lower.
I'm going to try and buy 900 shares of AES by selling the DEC 5 strike as the stock may get down there by then. This sell off is going to last a while and I don't want to be put too many stocks too soon, or I'll have to wait too long to recover my money, but given the 52 week high of $23+ and an all time of $68+ with an all time low of $3ish, I think that I'm getting in at the right price. This stock someday will go back up the $50-$100 and when it does I want to be in it.
Sold 3 puts, NYX Dec 20th 15 strike at .37 bringing into my account $111 (gross before Commission) I figured that the New York Stock Exchange isn't going to perish between now and Christmas and therefore a price of $15 for this stock is extremely cheap, but I don't want too many shares of it because its just too hard for me to figure out the fundamentals to the T. Think about it, where does the revenue come from. If it's from trading, well there has been a lot of that, if it's from the value of the seats, I'm sure that they are dropping, but at the end of the day, this it's basically a play on America and Europe getting together to make sure the financial systems do not collapse, if so, this will be a no brainer trade and I'll just keep the premium.
I don't necessarily want the stock on this one because I do believe that the physical markets will eventually perish, but not this year. Thus, I'm just hoping to keep the money on this play. If I get put the stock, I'll either sell covered calls against or just sell it out, but it's not a long term hold for me, more of a high premium play.
Sold 10 puts, EPIQ Nov 22nd 12.5 strike at .25 bringing into my account $250 (gross before Commission) I want to own this stock for the next 3-5 years or less because the more bankruptcies pick up, the more money this company makes. Talk about ruthless, wow! Sometimes you have to be to make a profit and this company is like sharks just swarming around this weak economy, looking to make money on those in corporations that are in trouble and its working. Still with all of the selling in the market place, I'd rather just try and buy this stock about $1.75 cheaper than its current price on a cost adjusted basis including the premium I took in. If I don't get to buy the stock this month, I'll try again next month.
Like I said, this selling is going to go on for a long time and we are just coming into the storm, not on the way out of it.
Now that we've seen some of the sell off and we'll probably see more, I'm looking long term. Do you think that electricity will be necessary for developing countries to keep up with their demand in the future when things pick back up? I think so and thus they will need new power plants to produce energy for their constantly growing population that wants the middle class lifestyle and I don't see why the Developing countries shouldn't have what they want, it may be a while, but they will get there, to the promised land. On sale at a never again in this century seen price is Symbol AES IMHO, but many of hedge funds still have redemption's to do and this stock may go lower.
I'm going to try and buy 900 shares of AES by selling the DEC 5 strike as the stock may get down there by then. This sell off is going to last a while and I don't want to be put too many stocks too soon, or I'll have to wait too long to recover my money, but given the 52 week high of $23+ and an all time of $68+ with an all time low of $3ish, I think that I'm getting in at the right price. This stock someday will go back up the $50-$100 and when it does I want to be in it.
Sold 3 puts, NYX Dec 20th 15 strike at .37 bringing into my account $111 (gross before Commission) I figured that the New York Stock Exchange isn't going to perish between now and Christmas and therefore a price of $15 for this stock is extremely cheap, but I don't want too many shares of it because its just too hard for me to figure out the fundamentals to the T. Think about it, where does the revenue come from. If it's from trading, well there has been a lot of that, if it's from the value of the seats, I'm sure that they are dropping, but at the end of the day, this it's basically a play on America and Europe getting together to make sure the financial systems do not collapse, if so, this will be a no brainer trade and I'll just keep the premium.
I don't necessarily want the stock on this one because I do believe that the physical markets will eventually perish, but not this year. Thus, I'm just hoping to keep the money on this play. If I get put the stock, I'll either sell covered calls against or just sell it out, but it's not a long term hold for me, more of a high premium play.
Sold 10 puts, EPIQ Nov 22nd 12.5 strike at .25 bringing into my account $250 (gross before Commission) I want to own this stock for the next 3-5 years or less because the more bankruptcies pick up, the more money this company makes. Talk about ruthless, wow! Sometimes you have to be to make a profit and this company is like sharks just swarming around this weak economy, looking to make money on those in corporations that are in trouble and its working. Still with all of the selling in the market place, I'd rather just try and buy this stock about $1.75 cheaper than its current price on a cost adjusted basis including the premium I took in. If I don't get to buy the stock this month, I'll try again next month.
Like I said, this selling is going to go on for a long time and we are just coming into the storm, not on the way out of it.
Wednesday, November 5, 2008
This sell off may take a while
We've had some unbelievable up days considering the financial mess that the world is in, so I'm going to let the bears win for a while maybe another day or two before putting on more trades.
I like selling puts into a declining market so that when I do get put stocks it's at a chap er price, but only after a good few days of selling. I need to let the sellers get rid of their stock, but then I'll be right back in selling puts some more and in the meantime I'll be researching good blue chips type stocks, with positive cash flow, growth and maybe a dividend here and there!
It going to be interesting to see what happens at the close, if the selling pressure continues and escalates , well then we're probably looking at another day of down . Which is ok because everytime some gets rid of or unwinds their long positions, it leaves room for more buyers at lower prices and more sellers of puts at higher premiums, like me, that makes me a happy camper.
I like selling puts into a declining market so that when I do get put stocks it's at a chap er price, but only after a good few days of selling. I need to let the sellers get rid of their stock, but then I'll be right back in selling puts some more and in the meantime I'll be researching good blue chips type stocks, with positive cash flow, growth and maybe a dividend here and there!
It going to be interesting to see what happens at the close, if the selling pressure continues and escalates , well then we're probably looking at another day of down . Which is ok because everytime some gets rid of or unwinds their long positions, it leaves room for more buyers at lower prices and more sellers of puts at higher premiums, like me, that makes me a happy camper.
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