Friday, April 20, 2018

Monthly: 115 – 10 Grade B, chasing the AMZN butterfly

I count 115 winners 10 losers for the April option cycle. Self grade is B. I am up about 2% for the month. I took on more risk to get that gain, and took some big losses.

My Amazon adventure started innocently, a low risk butterfly out to June. AMZN moved up the next day, and the next. I sold some puts to get back the cost of the butterfly. A few Trump tweets later, I was down like 500% on those legs. I spent the rest of the month rebalancing, doing a few day trades. It all worked out, though I took on a lot of tail risk. AMZN is an expensive underlying. So selling multiple layers of options naked means a large tail risk, if there is a market melt down or melt up. It worked out for me this time. I also profited on FB and in a small way on NFLX.

Some etfs that I track, year to date, best to worst:

GLD +2.4%
IWM +2.1%

SLV +0.9%
EEM +0.3%

SPY +0.2%
TLT -6.6%

My account is up 2.6%, so things are looking up. Hard to say which way the market wants to go. Just when I think the bull is back, the bears come back in. If I knew, I wouldn’t have to hedge, I could trade directionally.

Weekly: up then down

I am up for the week. The declines on Thursday and Friday, made it feel like a sour week. I takes some more losses. I profit in a small way from NFLX earnings.

Here are the trades (p=puts, c=calls, number near end is price per contract, sell means sell-to-open, cover means buy-to-close):

Mon Rally back on track after Syria attacks. It gets a little too hot and I close two legs for losses. Despite the losses, I am up a decent amount for the day. Astrology fans, Mercury is back to direct (was retrograde). For believers, the retrograde period brings higher chances of miscommunication, mechanical and electrical problems.

Cover COST Apr 195 c 188 for loss
Cover ULTA Apr 230 c 265 for loss


Sell IWM May 144 p 56

Sell JPM May 95 p 20
Sell QQQ Jun 140 p 86


Sell SPY MayW1 253 p 57
Sell AAPL May 155 p 68


Sell COST May 175 p 57
Sell SPY MayW2 252 p 70


Sell COST May 210 c 30
Sell ULTA May 255 c 80


Sell NFLX strangle: Sell NFLX Apr 250 p 45
Sell NFLX Apr 370 c 48

Tue Rally continues. I am up 0.63% today. Nice gain for one day, but lags SPY which is up +1.07%, and QQQ +2.16%. I do tend to lag during trending up moves.
Sell SPY MayW1 256 p
Sell QQQ MayW2 152 p 52


Sell SPY May 252 p 74
Sell UNH May 210 p 43 earnings


Sell SPY Apr 263 p 16
Sell ULTA May 205 p 75


I take some risk off by closing some sold calls for a profit.
Cover SPY May 280 c 70 for tiny profit
Cover NFLX Apr 370 c 17 for profit


Cover AMZN May 1700 c 570 for profit
Cover QQQ Apr 169 c 18 for profit


Wed A quiet day. I roll some positions, close some others.
All these are closed for profit:
Cover SPY Apr 252 p 04


Cover QQQ May 145 p 30
Cover AAPL May 150 p 29


Cover AMZN Apr 1600 c 66
Cover IWM May 141 p 23


Sell SPY May 254 p 74
Sell QQQ May 152 p 61


Sell AAPL AprW4 170 p 29
Sell IWM May 148 p 47

Thu Amazon up after publishing Prime subscriber numbers. Apple down on news.

Sell AAPL AprW4 182.5 c 16
Sell AMZN May 1250 p 335


Cover QQQ May 150 p 59 for profit
Cover SPY May 247 p 64 for profit


Fri Apple continues to decline. I close one leg for a big loss.
Cover AAPL AprW4 170 p 262 for loss
Cover SPY MayW1 253 p 51 for profit


Cover SPY May 250 p 84 for profit
Sell AAPL May 185 c 68

Saturday, April 14, 2018

Weekly: very very good to me

I enjoy a very good week, up around 5% in round numbers. I am now up about 1% for the year. That may sound like crap, but after being down over 10% a couple of times, getting back to break even is something to be thankful for. The major indexes are up this week with QQQ leading the way with a 2.8% gain.

My winners for 2018 include AMZN NFLX NVDA AAPL.
Losers include SPY BRKB UNH MMM.
Again, I am mostly selling strangles.

Here are the trades (p=puts, c=calls, number near end is price per contract, sell means sell-to-open, cover means buy-to-close):

Mon Markets rally then fades. A 400 point Dow gain shrinks to about 40 by the close. I sold some puts near the highs :( Almost all these are red by the close.

Sell MU Apr 43 p 23
Sell SPY AprW2 252 p 38

Sell AMZN Apr 1250 p 240
Sell QQQ AprW4 145 p 49

Sell SPY AprW4 245 p 57
Sell AAPL May 150 p 94

Tue Those 400 Dow points lost late Monday, are made back, as China’s leader drops hints about a possible trade deal (vs. tariffs and a possible trade war) and Mark Zuckerburg Facebook CEO, testifies for Congress. I rebalance by selling more layers of puts.

Sell SPY May 240 p 105
Sell BA Apr 307.5 p 112

Sell FB Apr 145 p 39
Sell TSLA Apr 245 p 63

Sell ULTA May 190 p 90
Sell QQQ Apr 151 p 45

Sell MU May 40 p 40
Sell SPY MayW1 247.5 p 97

Sell FB Apr 150 p 49
Sell WYNN May 150 p 101

Wed Sell FB AprW4 148 p 90

Thu Sell IWM MayW1 145 42
Sell QQQ MayW2 147 p 66
Sell QQQ MayW1 147 p 53

Sell SPY May 247 p 112
Sell SPY MayW2 245 p 80

Sell BA Jun 280 p 279
Sell MU Apr 47 p 15

Fri Stock market rallies in the morning then fades into the red. I add some delta in the morning, and these new positions are in the red by the close.

Sell SPY AprW4 254 p 53
Sell QQQ AprW4 153 p 44

Saturday, April 07, 2018

Weekly: A wild tariff ride

It is a wild ride, fueled by tariff news and interpretations. The major indices close down for the week:

DIA -0.7%, SPY -1.4%, QQQ -2.1%

My account is up a tiny amount +0.1%. It is a great week for hindsight traders, braggarts and liars. If a genie gave an options trader this weeks tick chart ahead of time, he/she could have made huge money. Unfortunately my life doesn’t currently include a magic genie. I muddled through. 

Mon Another down day
I lose about 4.5% today. I close out several legs for a loss as my mental stop levels are breached.

These are the four legs covered today for losses in the 350% to 600% range
Cover IBB Apr 103 p 285 for loss
Cover SPY Apr 257 p 526 for loss
Cover QQQ AprW1 155 p 311 for loss
Cover QQQ Apr 155 p 463 for loss

Sell AMZN Apr 1600 c 380
Sell QQQ Apr 169 c 34

Sell SPY Apr 273 c 40
Sell AMZN May 1800 c 295

Sell TSLA Apr 150 p 90
Sell QQQ May 172 c 57

Sell SPY May 277 c 67
Sell CMG Apr 360 c 52

Sell AAPL May 190 c
Sell AMZN Apr 1550 c 505

Tue On Monday, SPY touched the 200 day moving average. We bounce today. I mangle some Amazon trades. The results are okay, but could have been so much better. After all the dust, I about break even on Amazon trades for 2018. Considering how volatile the stock has been, and how badly I have traded it, it feels like a minor miracle. By the close, my account is up 3.8% for the day (after -4.5% on Monday).

Sell AMZN Apr 1575 c 370
Sell AMZN May 1700 c 685

Sell AMZN May 1000 p 490

Cover AMZN Apr 1600 c 325 for gain
Cover AMZN Apr 1575 c 305 for day trade gain

Wed Another crazy day, as the market gaps down at the open then rallies most of the day. Will we get a follow through up day? Or more crazy making?

Sell AMZN Apr 1600 c 120
Sell BA Apr 350 c 99

Sell BA May 250 p 113
Sell AMZN Apr 1000 p 60

Sell AAPL May 145 p 83
Sell SPY May 235 p 100

Sell QQQ May 135 p 54
Sell TSLA Apr 200 p 60

Cover AMZN Apr 1550 c 405 for gain
Cover AMZN May 1750 c 380 for gain

Thu Rally has legs. Third up day in a row for the first time in a month. I adjust several positions, selling new layers of puts, covering some calls, all for profit.

Sell SPY May 242 p 140
Sell QQQ May 142 p 101

Sell BA May 285 p 278
Sell BRKB May 180 p 115

Sell AMZN Apr 1200 p 199

Cover AAPL Apr 182.5 c 54 for profit
Cover BA Apr 360 c 99 for profit
Cover SPY May 285 c 39 for profit

Fri Another hard down day. The open is modestly lower then the selling picks up steam. The market does come off the worst levels. I cover two legs for a profit, to reduce long delta, reduce risk.

Cover QQQ Apr 143 p 43 for profit
Cover SPY Apr 245 p 103 for profit near worst levels of the day :(

Friday, March 30, 2018

Weekly: The rabbit hole called AMZN

I feel like Alice in Wonderland as I venture down the rabbit hole of Amazon. I came into the week with a butterfly, a near delta neutral position with limited risk. On Monday, I sold some AMZN puts naked. I spent the rest of the week doing damage control, suffering terrible draw downs. The selling of puts, even though high probability, weren’t a wise move. Not with the markets so crazy.

By the end of the week, I am up 3%, I’d say it was mostly luck. I closed some legs on various stocks, for losers as the market gyrated up, down and all around.

Here are the trades (p=puts, c=calls, number near end is price per contract, sell means sell-to-open, cover means buy-to-close):

Mon Markets rally as trade tensions ease. I scramble to stay long.
Sell BRKB May 175 p 129
Sell TSLA Apr 350 c 125

Sell INTC Apr 46 p 24
Sell AMZN Apr 1200 p 270


Sell CAT Apr 120 p 32
Sell BRKB Apr 180 p 62


Sell AAPL Apr 150 p 38
Sell SPY May 230 p 107


Sell QQQ May 140 p 85
Sell IWM May 130 p 54


Sell AMZN May 1250 p 1160

Tue A demoralizing day for me. The Monday rally turned out to be a massive head fake, especially for some tech stocks. I lose virtually all of Monday’s gains. The big losers include: Tesla, Amazon, Nvidia, QQQ. I add delta on Apple, Boeing, cover some calls on Berkshire, then the market turns sour.

Cover BRKB Apr 200 c for gain, but it was part of a complex position
Sell AAPL Apr 160 p 88


Sell BA May 270 p 235
Sell AMZN Apr 1750 c 190


Sell AMZN Apr 1700 c 380
Sell NVDA Apr 260 c 108

Sell NFLX AprW1 340 c 51
Sell QQQ May 175 c 54


Sell INTC Apr 57 c 16
Sell IWM May 164 c 40

Sell BA Apr 360 c 120
Cover TLSA MarW5 285 p 1069 for loss


Wed Down the rabbit hole I go. Declines in AMZN, NFLX and others leads to another bad day. I finish down 1.9%. Yikes.

Sell AMZN Apr 1600 c
Sell AMZN May 1750 c 1085


Cover QQQ Apr 158 p 481 for loss

Thu A relief rally before the market holiday on Good Friday. I am up 4.7% for the day. I end the week up about 3% for the week. Still down about 4% for 2018.

Sell AMZN Apr 1600 c 765
Sell COST May 170 p 114


Sell FB Apr 135 p 49
Sell NVDA Apr 180 p 37


Cover AMZN Apr 1600 c 550 for profit
Cover AMZN Apr 1600 c 690 for profit



Friday, March 23, 2018

Weekly: FFFF Facebook, Fed, fade and F

Down 7% for me this week. Whack, whack, whack. Hermosa Beach, CA residents may remember a bar that went by the acronym FFFF (Fat Face Fenners Falloon). This stock market week started with Facebook, then the Fed, then the huge fade on Thursday and Friday. Use your imagination for additional F’s.

Gamma did me in, as delta expanded on the sharp decline. Friday’s decline caught me by surprise. I thought we might get a balancing day, but down we went. After poking my head above break even for the year, down 7% for a week is horrible. I didn’t do anything incredibly stupid. However, being long and wrong, with volatility expanding, and it ended up as a very bad week.

Astrology fans can take note that Mercury went retrograde on 3/22/18 Thursday, and goes back to direct on 4/15/18.

Here are the trades (p=puts, c=calls, number near end is price per contract, sell means sell-to-open, cover means buy-to-close):

Mon Facebook gaps lower on news
Sell QQQ May 184 c 33
Sell QQQ Apr 180 c 18

Sell SPY May 290 c 39
Sell FB Apr 195 c 40

Sell TSLA MarW5 350 c 60
Sell IWM May 168 c 34

Sell BRKB Apr 220 c 36

Wed
FedEx up after earnings
Sell FDX Apr 230 p 89
Sell FDX Apr 280 c 40

Sell FB Apr 125 p 19
Sell FB Apr 195 c 20

Sell ULTA Apr 190 p 65
Sell CMG Apr 290 p 70

Sell SPG May 130 p 62

AMZN butterfly June 1450/1400/1350 puts for debit
Buy AMZN Jun 1350 p 2309
Sell 2x AMZN Jun 1400 p 3218 each
Buy AMZN Jun 1450 p 4430

Thu Crunch. Market gap down, then close near their lows. SPY down about 2.5% for the day. Gamma bites me and I am down 4.2% for the day. Yikes. Nothing got stopped out, but a whole lot of pain. The new positions from Wed, especially FDX are deep in the red. I sell some calls but the small premiums are almost nothing compared to the decline.

Sell SPY Apr 281 c 37
Sell QQQ Apr 176 c 23

Sell FDX Apr 265 c 69
Sell BRKB Apr 215 c 57

Sell FB Apr 190 c 42
Sell AAPL Apr 185 c 43

Sell QQQ May 180 c 42
Sell BA May 385 c 193

Sell BA Apr 365 c 105
Sell SPY May 285 c 49

Sell CAT Apr 165 c 52

Fri
Market opens flat then tumbles into the close. Another day at the whipping post for me, down another 3%. Astrology fans might take note that Mercury went retrograde yesterday. SPY down 5% since then. My account down 7%. Mercury goes direct 4-15-2018. Not sure if I can stand another couple of weeks of this. I cover three legs for losses, sticking to my stop loss levels. These are ball buster losses 600% to 1000%. Especially FDX which I just sold to open two days ago.

Sell ULTA Apr 230 c 62
Sell IWM Apr 161 c 32

Sell BRKB May 210 c 191
Sell BRKB shares for 193.64 per for gain

Sell AAPL 182.5 c 57
Sell SPY Apr 275 c 52

Sell QQQ Apr 172 c 37
Sell BRKB Apr 175 p 100

SPY backratio for small credit: Buy SPY Jun 250 p 644
Sell 2x SPY Jun 235 p 361 each
Sell SPY Jun 282 c 85

Sell CAT Apr 110 p 24
Sell COST Apr 195 c 51

Sell FB Apr 185 c 43

Saturday, March 17, 2018

Monthly: back to black, 63 – 8 grade C+

I count 63 winners, 8 losers for the March option cycle. I am back to positive for the year. So happy St. Patrick’s Day to celebrate my poke into green territory for 2018. SPY is up more than I am, but gains are better than losses.

One slight adjustment I decided upon was to go further out in time for rebalancing adjustments. This helps during see-saw markets. Shorter term adjustments can be better during trending markets, because I would make more of them. Grade is C+, because I have a lot of room for improvement.

Here are a few etfs I track (best to worst):
EEM +4.4% Emerging markets equity
IWM +3.5% US small cap Russell 2000


SPY +3.1% US large cap SP500
GLD +0.8% gold


SLV -3.8% silver
TLT -5.6% US 20 year Treasury bonds

My trading account up a few dollars, 0.0% percent when using the formula. So I am lagging buy and hold for 2018, but it is a lot better than behind the 8-ball and being down 5% or 10% for the year. The year is full of woulda coulda shoulda moments. Trading is so easy in hindsight, but few do so well in real time. Yes, there are a handful of unicorns with remarkable talent and/or luck. For average folks, average returns, average losses are what most of us experience.

One story to share is that the wild market swings of February led to insomnia. During one sleepless night, someone on the radio was extolling the benefits of meditation. Since that time, I have been meditating maybe five minutes a day. It seems to be helping. I use a fitness watch to track my sleep. Since I started meditating I’ve had more deep sleep, higher quality sleep. As always YMMV, but so far my experience with meditation has been a positive one. Like so many people, I had difficulty doing it, but like so many things in life, a little effort goes a long way.

Weekly: Whipsaw

I close out three legs during the week for a loss. In all three cases it was near the worse levels and the underlying reversed. The markets settled a bit. I made money, but obviously would have made more had I waited until end of day before honoring the stop stop levels.

The good news, is that I now ever so slightly in the green for the year. I am still lagging buy and hold of SPY, but green is a whole lot better than the draw down levels I saw earlier in the year.

Here are the trades (p=puts, c=calls, number near end is price per contract, sell means sell-to-open, cover means buy-to-close):

Mon Sell SPY AprW1 262 p 75
Sell IWM May 141 p 87
Sell QQQ Apr 158 p 71

Tue Whipsaw. Market opens higher than moves lower. I cover two call legs near the day’s highs, only to see the market reverse lower. After the bull has left the barn, I sell some calls to rebalance my deltas.

Cover QQQ Mar 175 c 129 for a 500% loss
Cover SPY Mar 280 c 140 for a 400% loss


Also near the highs I roll BRKB covered calls:
Cover BRKB Mar 200 c 1230 for profit
Sell BRKB Apr 200 c 1400


After the bull has left the barn I sell some calls. Whack-a-mole, and I am the mole today.
Sell SPY May 295 c 51


Sell QQQ May 190 c 23
Sell BA Apr 390 c 77


Sell NFLX AprW1 375 c 63
Sell VIX Apr 50 c 15

Wed It is Ground Hog day for me in Boeing. Stops are run, I cover one leg for a huge loss, stock rebounds. It reminds me of Charlie Brown, Lucy Van Pelt from the Peanuts. Lucy puts out the football for Charlie to kick and always pulls it away as he runs up.

Cover BA Mar 325 p 565 for 1000% loss
Sell BA Apr 265 p 99


Sell BA AprW1 375 c 61
Sell BA Apr 380 c 113

Fri Sell TSLA MarW5 285 p 143

Saturday, March 10, 2018

Weekly: Goldilocks plus 5

A good week for the bulls. SPY up 3.5% for the week. My account up about 4.1%. I am still down a tiny bit for the year, so I have more work to do. Overall, the week was a huge disappointment for stock market bears. The resignation of a top Trump advisor had the bears licking their chops, but the decline was shallow and short. A booming melt up rally on Friday, fried many bears. I took a loss on one leg of sold calls, and many others are deep in the red. I kept adding long delta, by selling way out of the money puts.

Here are the trades (p=puts, c=calls, number near end is price per contract, sell means sell-to-open, cover means buy-to-close):

Mon Market opens lower, then rallies.
Sell BA Apr 400 c 100
Sell NFLR Mar 260 p 59

Sell COST Mar 172.5 p 52 ahead of earnings
Sell QQQ Apr 149 p 77

Sell SPY Apr 247 p 128
Sell BA Apr 300 p 196

Sell TSLA MarW4 275 p 71
Sell SPY Mar 257 p 43

Tue Sell NFLX Mar 280 p 93
Sell COST MarW1 177.5 p 41 add

Sell NFLX AprW1 275 p 244
Sell QQQ May 145 p 103

Sell SPY May 238 p 144
Sell IWM May 135 p 90

Wed Trump economic advisor resigns. U.S. markets gap down at the open. SPY closes unchanged for the day, a huge disappointment for the bears.
Sell ADSK Mar 120 p 31 Autodesk higher on earnings.

Thu Costco slightly lower after earnings. WYNN up after an analyst meeting.

Sell COST Mar 195 c 15
Sell IBB Apr 100 p 50

Sell WMT Apr 97.5 c 27
Sell WYNN Apr 140 p 64

Sell WYNN Mar 160 p 22
Sell MCD Apr 175 c 16

Fri A jobs report, detente with North Korea, spark a massive stock market rally. I cover one sold call leg for a loss, and add long delta through out the day.

Cover QQQ Mar 172 c 145 for loss
Sell NVDA Apr 200 p 124

Sell AAPL Apr 155 p 43
Sell NFLX Mar 300 p 100

Sell BRKB Apr 195 p 101
Sell IWM Apr 145 p 62

Sell QQQ May 250 p 144
Sell IBB Apr 103 p 51

Sell BRKB Jun 185 p 143
Sell NFLX MarW4 295 p 104

Sell COST Apr 170 p 67
Sell SPY Apr 257 p 93

Sell WYNN Apr 160 p 143
Sell SPY Apr 252 p 96

Sell SPY May 250 p 144
Sell QQQ Apr 155 p 77