The rallies in the stock market and precious metals are strong. I have an up week, though I wish for more. Haha. Happy V-day to all. Here's a recap of my trading week:
Fri sell IWM strangles @113.9, sell Mar 100 puts and sell Mar 120 calls. A short strangle is a bet on a trading range.
Sell GILD Mar 70 puts @81.0. I initiate a small long position in Gilead Sciences mostly based on the chart, and seeing GILD on the losers list.
Thu sell AMGN Feb 110 puts rebalance @123.7. I rebalance my Amgen position back to net long by selling puts. As for the overall stock market, the rally is a wonder to behold.
Wed sell VRX Mar 100 puts @140.6. I add to longs on Valeant Pharma. The reason for 40 points out of the money is that option has 90% probability for profit, on this volatile stock. Earnings are coming up, and in hindsight, the premium expands further, so waiting a couple of days to sell these would have been better.
Sell KORS Mar 82.5 puts @96.0. I add to my long complicated long position in Michael Kors. Again, I choose the 90% probability option to sell. The ThinkorSwim platform has this information. For those on platforms without this information, the delta gives a decent approximation for probability. For example, a delta of .10 means about a 10% chance for that option to expire in the money.
Tue cover short BRKB Mar 115 calls rebalance @113.7. This is another painful covering of short calls at a big loss, during this rip-the-face off the bears stock market rally.
Sell SPY Mar 168 puts @182.3. I close out a leg of my March put backratio. I am taking on more risk and using up more margin, but the odds are about 11% of a decline below 168 before March expiration.
Mon cover short BRKB Feb 115 calls rebalance @112.6. Berkshire Hathaway continues to bounce. I cover short calls to rebalance my complicated position back to near neutral.
Cover short KORS Feb 110 calls rebalance @95.6. Michael Kors is running higher, I cover some short calls to rebalance back to a long position. Should have never sold these calls (shakes head). A few minutes later and it looks like a head fake on both these as KORS fades below 95, and BRKB back to negative.
Sell HON Mar 82.5 puts @92.6. Honeywell came up during my weekend chart review of the stocks in the SP100. I open a small position with a worm trade (low risk, tiny premium collected).
Sell DIS Mar 70 puts @77.0. I double up on my long position in Disney as it moves to new highs.
net short AMBA BA BRKB TLT XRT XOP
net long ASH GLD GS IWM KORS OXY SPY
net neutral AMGN
long DAL DIS GILD HON LGF MRK PG TM WFC