Weekly: Brexit goes boom

Stock markets tumble on Friday as the UK votes to leave the EU, the Brexit. I got caught in the bull rally trap. It was a good week to be a cautious trader. My losses for the week ended about the same as SPY -1.4% or so. The other piece of crap was Telsa bidding to take over Solar City. I will live to trade another day. I did a lot of tap dancing, but it could have been many multiples worse.

I'm sure some aggressive traders were hit hard by the big moves this week, though a few may have had a huge up week. I plan to skip a week of blogging because of travel. Hopefully it will be a quiter week. I'll have two weeks of updates on July 9th. I am looking for more downside, because many novices want to buy this decline. I sold a lot of calls thinking that any upside will be limited.

Here are the crap trades for a crap week (c = calls, p = puts, all are third week expiration unless noted, sell means sell-to-open, cover means buy-to-close, number is price per contract):

Mon Big rally on Brexit poll movements to stay. After option expiration, I have a lot of dry powder and put some to work.

Sell SPY JunW4 201 p 26

Sell SPY JulW2 195 p 44

Sell CMG Jul 305 p 50

Sell ULTA Jul 220 p 80

Sell AVGO Jul 135 p 40

Sell TSLA strangle: Jul 180 p / 265 c 82

Sell TSLA Jul 180 p 51

Sell TSLA Jul 265 c 31

Sell BRKB Aug 125 p 54

Tue Sell SPY JunW4 199 p 25

Wed Telsa down hard on news that it wants to acquire Solar City. I tap dance all day long. For the most part, the hole keeps getting bigger.

Sell TSLA Jul 240 c 61

Sell TSLA Jul 160 p 48

Sell MCD Jul 110 p 20 McDonalds lower on downgrade. I go long, but with a tiny position.

Sell TSLA JunW4 215 c 27

Sell TSLA JulW2 222.5 c 53

Cover TSLA JunW4 200 p 490 about a 500% loss

My gut tells me to stay with this one. In hindsight, I thankfully didn't listen to my gut and followed my rules as TSLA touched 189 before the week was over.

Sell TSLA JunW4 210 c 27

Sell TSLA Jul 225 c 111

Sell TSLA JunW4 207.5 c 36

Sell TSLA JunW4 185 p 36

Sell SCTY Jul 26 c 26

Sell FDX strangle 135/170 for 54: 

Sell FDX Jul 135 p 24

Sell FDX Jul 170 c 28

Sell ULTA Jul 255 c 54

Thu Sell TSLA JulW1 222.5 c 40

Sell TSLA JulW1 170 p 44

Sell TSLA JulW2 165 p 46

Sell SPY JunW4 203 p 34

Fri Brexit yes is to leave. Markets tumble. At the open, I am lucky enough to have modest losses.

Sell SPY JulW2 213.5 c 24

Sell SPY Jul 214 c 30

Sell GLD Aug 115/150 strangle 71: GLD Aug 115 p 41

Sell GLD Aug 150 c 30

Sell GLD Jul 117 p 18

Sell VGK Jul 48 c 29

Mid-day worried about a sell off into the close

Cover TSLA JunW4 185 p 04 for 90% gain

Cover SPY JunW4 203 p 27 for 12% gain

Online newbies lean towards buying this dip. I sell calls thinking any up side is limited and more downside may be coming.

Sell IWM Jul 119 c 17

Sell MCD Jul 125 c 22

Sell AVGO Jul 165 c 43

Sell GDX Aug 21/36 strangle 36: 

Sell GDX Aug 21 p 20

Sell GDX Aug 36 c 16

Sell TSLA Jul 210 c 148

Sell VRX Jul 27.5 c 17

Sell WFC Jul 50 c 13

Sell CMG Jul 465 c 52

Sell TSLA JulW1 170 p 38

We didn't get the hard sell off into the close that I feared. Market may tick up on Monday as some novice mutual fund buyers want to buy the dip. I lean towards more

Monthly: Up, Down, Sideways, 51-10 Grade C+

I count 51 winners, 10 losers for the June option cycle. I eek out a gain, but it felt like a crap month. About two weeks ago, I was feeling pretty good, then my fortunes reversed and most of the gains for the trading month slipped away. My two big winners for 2016, my so-called lucky stocks, CMG and TSLA turned against me. Despite the recent setbacks, these two still top my winning ticker symbols list for 2016. 

I managed the Monsanto takeover mess, and booked some more losses, but they were manageable. Considering I was short three legs of calls before the takeover news, the losses were as bad as imagined. Part was due to luck, but I didn't freeze on the news.

A lot of people are looking at the Brexit vote, whether the UK leaves or remains in the European Union. Longer term, it will have ripple effects. Shorter term, it is often the higher percentage play to go against the crowd. As for the bigger picture, here are some etfs I track, best to worst for calendar 2016:

YTD for 2016, dividends are not included

SLV +25.9% silver

GLD +22.2% gold

TLT +12.5% U.S. 20-year treasury

EEM +3.4% Emerging market stock

SPY +1.3% U.S. large cap stock

IWM +1.3% U.S. small cap stock

my account +2.2%

So, some good news and bad news. The bad news is that we didn't go all in on gold, silver and treasuries on Dec 31, 2015. The good news is that I am up for the year, about even with the U.S. stock indices, after factoring in a 1% SPY dividend yield. The other good news is that +2% isn't terrible for six months, and ahead of most short term CDs and savings accounts.

When people hear "options trader," many think gun slinger, YOLO (you only live once) kind of traders that take huge risks. Not very many think about cautious, near delta neutral traders like me. I don't care what others think. I hope you are the same. My rule #1 is to live to trade another day. Risk and reward are often correlated. I rarely take on a lot of risk, so my returns are going to be on the small side.

Weekly: Stop losses lead to frustration

It was a frustrating week. Several stop loss levels got triggered and I took some big losses. A mild recovery later in the week was a small consolation prize for my losing week. Two of my "lucky" stocks for 2016 went bad, as I took big losses in Chipotle and Tesla. Most galling was CMG, had I held to expiration, it would have come out fine. Instead I took big hits on two legs.

 

Stop losses are a philosophical question for traders. Either a person uses stops or doesn't. If a person uses stops, there are going to be times like this week, when the stops get run and then the stock reverses. It is mostly a matter of when not if. If a trader uses technical support levels, everyone else can see those same chart levels.

The other side is that if a person doesn't use stops a trending move can cause massive damage. The losses can go exponential for those that sell naked options on leverage. In fast markets, margin calls and forced liquidations can and do happen. This too is also a question of when not if. Yes, the odds or a huge trending move are smaller, but when it does happen, it can wipe out a leveraged account.

Here are the trades (c = calls, p = puts, all are third week expiration unless noted, sell means sell-to-open, cover means buy-to-close, number is price per contract):

Mon Cover TSLA Jun 217.5 p 365 -500%

Cover CMG Jun 397.5 p 913 -700%

Cover CMG Jun 395 p 800 -600%

A royal "flush" as I cover three legs for huge losses. The declines in Chipotle run through my stop levels. TSLA doesn't break it, but sold another leg of 217.5 puts so cover a bit early. Time to regroup, try and clear my head after these destabilizing hits. My consolation prize is at least I wasn't short LNKD calls (LinkedIn went up about 50% today and anyone short calls was obliterated).

Tue Cover TSLA JunW5 217.5 p 675 about a 400% loss

Sell CMG Jun 365 p 55 Chipotle closes higher after being down 10 points

Wed Sell IWM Jul 121 c 23

Sell SPY Jul 216 c 28

Thu Cover VRX Jun 22.5 p 56 about a 45% loss

Sell GLD strangle 115 p /145 c for 42

Sell Jul GLD 115 p 23

Sell Jul GLD 145 c 19

Sell TLT strangle 127 p /150 c for 36

Sell TLT Jul 127 p 16

Sell TLT Jul 150 c 20

Sell SPY Jul 192 p 82 add delta as market rallies

Sell IWM Jul 101 p 30

The monthly update will come tomorrow (Sat).

Weekly: CMG TSLA VRX

It was a see-saw week and I got the short end of the stick at the end. My account was down, mostly from CMG and TSLA. Just when I thought we might be settling in for calm summer trading, there is a sharp drop on Friday. We will see if there are more storms and I get stopped out on my positions, or if blue skies return and I escape. 

 

Here are the trades (c = calls, p = puts, all are third week expiration unless noted, sell means sell-to-open, cover means buy-to-close, number is price per contract):

Mon Sell to close TSLA Jun 200 p 72 for a 92% loss

I bought these puts for over $800 per contract, so getting out at $72 seems terrible. The big picture is that I used this leg to sell many layers of weeklies puts so overall I am on the sum of all TSLA positions.

Sell TSLA Jun 202.5 p 82

Sell TSLA Jun 250 c 16

A bit later, I sell a layer of strangles with a bullish skew.

Tue Sell VRX Jun 28.5 c 16 Valeant lower after earnings

Sell XLE JunW4 64 p 16 rebalance

Sell TSLA JunW4 200 p 88

Sell TSLA JunW4 260 c 36

Tesla rally rolls on, I sell another brace of strangles

Sell VRX strangles 56: Sell VRX Jul 15 p 26

Sell VRX Jul 35 c 30

Sell TSLA Jun 210 p 60 rebalance

Sell VRX Jul 15 p 15 rebalance

Sell SCTY Jun 20 p 20 rebalance

Wed Sell TSLA Jun 217.5 p 81 rebalance

Cover TSLA JunW1 200 p 02 buying power

Sell TSLA JunW4 217.5 p 140 rebalance

Thu Sell TSLA Jun 257.5 c 22

Fri Cover GLD Jun 109 p 01 95% profit

Sell TLSA JunW4 240 c 112 rebalance

Weekly: Sorry... AVGO SIG ULTA

Sorry for the late update. I had some computer trouble. Anyway, some new positions involve selling strangles on AVGO, ULTA, and selling puts on SIG.

Here are the trades (c = calls, p = puts, all are third week expiration unless noted, sell means sell-to-open, 

cover means buy-to-close, number is price per contract):

Tue Sell XLE Jul 59 p 26

Sell IWM strangles Jul 103/122 69

Sell IWM Jul 103 p 50

Sell IWM Jul 122 c 19

Wed Sell TSLA JunW2 242.5 c 28

Sell XOP strangle 44: 

Sell XOP Jul 30 p 30

Sell XOP Jul 42 c 14

Sell VRX Jun 22.5 p 41 rebalance

Sell ULTA strangle: 

Sell ULTA Jul 210 p 109

Sell ULTA Jul 260 c 46

Sell IWM Jun 107.5 p 14 rebalance

Sell CMG Jun 475 c 90 rebalance

Thu Sell CMG Jun 397.5 p 111 rebalance

Sell AAPL Jun 102 c 19 rebalance

Sell SIG Jun 75 p 35 new long position

Sell MON Jul 90 p 60

Fri Buy SPY Sep vert put spread 186

Buy SPY Sep 200 p 428.5

Sell SPY Sep 190 p 244.5

Sell IWM Jul 107 p 62

Sell WFC Jul 45 p 20

Sell AVGO strangle: 

Sell AVGO 150 p 45

Sell AVGO 175 c 27

Sell XLE Jul 72 c 16

Sell GDX Jul 20 p 17

Weekly: AAPL CMG COST CRM VRX

First, happy Memorial Day to all, and thank you for those that have served or are serving in the armed forces. Overall, a profitable week. I almost always want bigger profits when the market goes up so much. I took a loss as AAPL rallied. I sold new strangles on CMG and VRX. Sold puts on COST, CRM.

 

Here are the trades (c = calls, p = puts, all are third week expiration unless noted, sell means sell-to-open, cover means buy-to-close, number is price per contract):

Mon Buy shares MON 107.775 Bayer makes a $62 billion cash bid for Monsanto. MON gaps higher. I am again short three layers of calls, own one layer of stock, now two after this move.

Sell AAPL Jun 89.5 p 34 rebalance Apple moving higher on news.

Sell SCTY Jun 16 p 25 hedge. SolarCity has drifted steadily higher since I sold the Jun 25 calls. I am hedging turning it into a sold strangle.

Sell TSLA JunW1 195 p 65 rebalance

Sell TLSA JunW1 202.5 p 125

Sell TSLA MayW4 202.5 p 41

Sell CMG strangle @460: 192 gross

Sell CMG Jun 395 p 116

Sell CMG Jun 525 c 77

Sell COST MayW4 132 p 28

Sell TSLA MayW4 235 c 33

Sell CRM Jun 75 p 38 new long

Tue Sell MON Jun 92.5 p 25

Sell MON Jun 100 p 100 Monsanto says $122 per share offer from Bayer is insufficient

Wed Sell MON Jun 105 p 130

Sell AAPL Jun 92 p 23

Thu Sell COST Jun 140 p 31 earnings

Sell TLSA JunW2 200 p 83

Sell AAPL Jun 94 p 40

Cover AAPL Jun 100 c 225 for a 600% loss

Fri Sell TSLA JunW1 245 c 31

Sell VRX strangle: 60 gross

Sell VRX Jun 20 p 32

Sell VRX Jun 40 c 29

Monthly 85-12 Treading water, grade C

I count 85 winners, 12 losers for the May option cycle. Sounds good at first, but some of the those losers were over 1000% (basis premium collected). Self-grade is C. So far in 2016, that's four not so good months, and only one good month. Overall, I am up a bit for the year, and the slimmest of gains for the month.

Monsanto was this May's main culprit. MON gapped higher on takeover news and I was short three legs of calls. I also had losers in ATVI JNJ MCD.

Tracking a few etfs from best to worst:

SLV +19.0% silver

GLD +18.0% gold

TLT +7.9% 20-year US treasuries

SPY +0.8% S&P 500 U.S. large cap

EEM +0.1% Emerging market equity

IWM -1.6% Russell 2000 U.S. small cap

My trading account is +1.4% for 2016, which isn't half bad, but not exactly good either. It is beating the U.S. stock indexes, which is mostly what I have been trading. Treading water is a good description. A lot of effort, a lot of activity, not much progress. The biggest losers for 2016 by ticker: BA UA MON. 

The biggest winners for 2016 by ticker: CMG TSLA SPY MCD. Sometimes a stock gets on the avoid list, if I continue to struggle with it. Sometimes I might take more chances if it is on the winner list.

The last few weeks have felt stressful, so it may be good for me, to take it easy for a little bit. With Memorial Day marking the beginning of vacation season for many of the big market fish, we will see if we settle into quiet summer trading, or not.

Weekly: TGIF

Another stressful week with little to show for it. I am glad it is expiration Friday. I was about break even for the week. I took two losses in MCD, and continued to tap dance with my MON, TSLA positions. I was near the red line on buying power.

Here are the trades (c = calls, p = puts, all are third week expiration unless noted, sell means sell-to-open, cover means buy-to-close, number is price per contract):

Mon Sell ATVI Jun 35 p 27 rebalance

Sell TSLA MayW5 190 p 110 rebalance

Sell AAPL Jun 85 p 40 rebalance, news is that Warren Buffet bought $1 billion worth of Apple.

Cover ATVI May 39 c 75 530% loss

Cover XLE May 60 p 01 93% gain buying power

Tue Roll MON calls 90 cent credit

Cover MON May 97.5 c 360 -950% loss ouch

Sell MON Jun 100 c 450

Liquidity is not good on Monsanto options. I roll one short leg of calls to June. It is still FUBAR overall. I rue the day I ever got into Monsanto.

Wed Roll TSLA 25 cent credit

Cover TSLA May 182.5 p 04

Sell TSLA May 197.5 p 29

Thu Cover MCD May 125 p 72 about a 350% loss

McDonalds moves through the strike price, and I take the loss.

More damage control on Monsanto

Sell MON Jun 92.5 p 85

Roll MON calls 68 debit:

Cover MON May 96 c 630 about a 3300% loss!

Sell MON Jun 100 c 562

Sell MON Jun 115 c 89

Fri Roll TSLA 49 credit

Cover TSLA May 197.5 p 04 85% profit

Sell TSLA MayW5 197.5 p 53

Sell MCD Jun 130 c 31 rebalance

Cover MCD May 124 p 84 for a 200% loss

Sell MON Jun 87.5 p 41 rebalance

Weekly: MON Nightmare scenario

SPY was down about 1% for the week, I was down about the same. Thursday was a nightmare morning. . I came into the day short three tranches of calls on Monsanto. MON gapped higher on take over rumors. I did trading triage, closing one leg for a huge loss, and bought some stock to cover one of the other legs. It may have been my worst day of 2016. 

The rest of the week had some of the normal ebb and flow. I sold strangles before Disney earnings and those are in the green so far. I closed out some SPY puts at what turns out to be a poor time.

Here are the trades (c = calls, p = puts, all are third week expiration unless noted, sell means sell-to-open, cover means buy-to-close, number is price per contract)

Mon Sell GDX May 26.5 c 19

Sell GLD May 126 c 20

Cover CMG May 335 p 05 90% profit

Sell CMG May 407.5 p 70 roll

Sell MCD Jun 120 p 40 rebalance

Sell MCD May 125 p 18

Cover IWM May 90 p 01 97% profit

Tue Cover JNJ May 115 c 81 450% loss

Cover MON May 89 p 151 300% loss

Sell SCTY Jun 25 c 21 earnings

Sell strangle: DIS May 97.5 p 15

Sell DIS May 114 c 13, ahead of earnings

Sell-to-close SPY Jul 200 p 285 1% profit :)

Cover May SPY 190 p 04 95% profit

Cover FB May 90 p 01 95% profit

Sell FB May 113 p 20

Sell TLT Jun 140 c 18

Wed Sell TSLA May 190 p 78 rebalance 

As Tesla catches a bid

Thu Cover SPY May 199 p 15 66% gain

Cover SPY May 185 p 02 96% gain

Buy shares MON market 100.4

It is a nightmare scenario, Monsanto gaps higher on takeover rumors and I am short three tranches of calls. I do triage. I free up some buying power first, then place a market order to buy some MON shares. The May options are $3 wide this morning, so there is no exit by covering those right now, not without taking another huge hit. Ouch.

Cover MON Jun 100 c 450 about a 1200% loss

After the first half hour of trading, the options markets become more normal and I exit one leg. I am close to a manageable position now on MON, but have paid a heavy price to get there.

Sell AAPL Jun 100 c 34 rebalance Apple at a 52-week low

Fri Cover CMG May 407.5 p 23 for 70% profit, need buying power

Sell NVDA Jun 35 p 22 earnings

Weekly: Tesla mess-la

Another Fine Mess is a Laurel and Hardy movie from 1930. That's kind of the way the week felt, even though I end the week with a modest gain. A lot of my attention was on Telsa's earnings report. I was speculatively long, then reversed to short, then hedged the shorts. Tesla became a mess-la. I was down a bit on TSLA for the week. I also took a loss on Under Armor UA as it moved lower.

Also this week, sold puts in BDX, sold strangles on ATVI, sold more puts on GDX. Here are the trades (c = calls, p = puts, all are third week expiration unless noted, sell means sell-to-open, cover means buy-to-close, number is price per contract)

Mon Sell TSLA MayW1 195 p 46

Sell TSLA MayW1 290 c 20 earnings Wed after close

Tue Sell SPY 218 c 18 rebalance

Wed Sell UA May 45 c 15 rebalance as Under Armor moves lower on news

Sell SPY May 212 c 24 rebalance

Sell MCD May 124 p 30 rebalance

Cover UA May 40 p 125 for a 900% loss

Thu Sell TSLA May 255 c 91 Telsa fizzles after earnings, up a bit after hours, now drifting lower. My speculative call ratio is a loser.

 

Cover TSLA MayW1 195 p 20 about a 50% profit. I don't like the tape action.

As the day goes on I reverse to speculative short, a rare case of me buying premium: Buy TSLA June put spread 537 gross debit:
Buy TSLA Jun 200 p 803

Sell TSLA Jun 175 p 266

Sell BDX Jun 150 p 55 Becton Dickenson higher on earnings

Sell MON May 96 c 20 rebalance

Sell MON Jun 100 c 38 rebalance

Fri Sell TSLA MayW2 185 p 46 rebalance

Sell ATVI May 34.5 p 15 earnings

Sell ATVI May 39 c 14 Activision flopping so I hedge

Tesla finding support, so I hedge my short position by selling more puts

Sell TSLA May 182.5 p 79

Sell GDX May 22 p 15 add to longs

Weekly: Bonds, gold, pizza, and Mercury

Mercury went retrograde on Thursday, and the stock market turns. Gold and bonds have been the big winning asset classes during calendar 2016. I initiate some small long positions in gold, gold miners and bonds (selling puts GLD, GDX, TLT). Pizza was the big sour note of the week. Dominos Pizza DPZ earnings disappointed and I took a big loss.

Chipotle CMG continued to be a lucky stock for me, as do Tesla TSLA and Valeant VRX. Here are the trades (c = calls, p = puts, all are third week expiration unless noted, sell means sell-to-open, cover means buy-to-close)

Mon Sell CMG AprW5 380 p 195 Chipotle has drifted lower into earnings. Sentiment on the Yahoo boards is also mostly negative. Even with a negative report, I am at the 8% probability line.

Sell VRX strangles: AprW5 for 44 gross Valeant slightly higher with news of a new CEO

Sell VRX AprW5 24.5 p 28

Sell VRX AprW5 50 c 16

Sell MCD May 120 p 29 rebalance

Tue Sell CMG May 335 p 50 Add to longs ahead of earnings news.

Wed Sell CMG Apr 475 c 60

Cover CMG AprW5 380 p 11 90% profit, taking my money and running

Cover ISRG May 550 p 55 35% profit, don't like tape action

Sell PNRA May 200 p 65 earnings

TSLA ratio spread 203 gross / bullish earnings play

Buy TSLA May 275 c 522

Sell 2x TSLA May 300 c 160x2

Sell TLT Jun 120 p 29

Sell GLD Jun 109 p 23

Sell TSLA AprW5 262.5 c 28

Buy SPY put vertical 140 gross

Buy SPY Jul 200 p 281

Sell SPY Jul 190 p 141

Sell PNRA May 230 c 25 rebalance

Thu Sell FB May 107 p 26 rebalance

Sell DPZ May 130 c 65 rebalance, earnings poor

Sell CMG May 370 p 94 rebalance

Sell GDX Jun 19 p 20

Sell MON May 89 p 44 rebalance

Sell JNJ May 116 c 16

Sell XLE Jun 76 c 16

Cover DPZ May 120 p 295 about a 550% loss

Fri Market sell off continues as Mercury has gone retrograde. I sell some more calls to rebalance my positions.

Sell YUM May 86 c 28 rebalance

Sell JNJ May 115 c 20

Sell SPY May 213 c 25

Sell XOP Jun 43 c 20

Sell UA May 48 c 15

Sell UNH May 138 c 24

Sell SPY June put backratio 18 gross:

Buy SPY Jun 190 p 130

Sell 2x SPY Jun 183 p 74 per

Sell CTXS May 87.5 c 20 rebalance

Sell UNP May 94 c 21

Cover TSLA AprW5 237.5 p 05 85% profit

This last one was a nail-biter as the low for the day was 238 or so. I closed it for a nickel rather than risk a last minute move.

 

Weekly: small fish and oil

The news from last weekend was that oil producing countries could not agree on any production cuts. On Monday, the initial reaction was a sharp down gap in oil and oil stocks. Then buyers came in large. To me, the up day on bad news may mean the bottom is in for oil and oil stocks. I took some small long positions in XLE and XOP and then added to them. 

 

It was a busy week for earnings news. I mostly went after a lot of small fish. I sold many low premium out of the money puts on stocks with positive earnings news. Elsewhere, TSLA continued to make me money as it continued in its tight range and six layers of sold options came in safe. Mostly small fish, but enough sardines can make a nice mea1.

Here are the trades (c = calls, p = puts, weeklies denoted by W suffix, W1 is week1, sell means sell-to-open, cover means buy-to-close, number is price per contract).

Mon Sell BRKB Jun 130 p 55

Sell XLE Jun 55 p 33 news

Sell HAS May 77.5 p 15 earnings

Sell TSLA strangle 108 gross:

Sell TSLA AprW5 222.5 p 59

Sell TSLA AprW5 285 c 49

Tue Sell UNH May 120 p 42 earnings

Sell MON May 82.5 p 45 rebalance

Sell XOP Jun 27 p 22

Sell TSLA AprW5 272.5 c 60 rebalance

Sell TSLA AprW4 260 c 38

Wed Sell UNH May 125 p 51 add

Sell ISRG May 550 p 90 earnings

Sell SPY May 199 p 49 rebalance

Sell TSLA AprW4 240 p 46 rebalance

Sell JNJ May 108 p 23 add

Sell XLE May 60 p 18 add

Sell XOP May 30 p 18 add

Thu Sell YUM May 75 p 20 earnings

Sell UA May 40 p 15 earnings

Sell CTXS May 77.5 p 25 earnings

Fri Sell SKX May 27.5 p 15 earnings

Sell MCD May 132 c 29 earnings

Monthly: 52-3 grade A-, I'll take it

I count 52 winners, 3 losers for the April option cycle. After opening 2016 with month after month of mediocre trading (grades D, C-, C), I finally have a good month. The good news is that I have crossed the Mendoza line and now have a modest profit for calendar 2016. The bad news is that I am lagging behind SPY (S & P 500 etf). Still, after opening the year with an 8% drawdown, getting back to break even is a step forward.

Overall I was too cautious during a powerful stock market rally. I have also missed the boat in my trading account, on gold and bonds so far. Premiums aren't big enough to tempt me on GLD, TLT or similar instruments.

Here are a few etfs, current price and their 2016 ytd (dividends excluded):

SLV 17.2% 15.46 silver

GLD 16.2% 117.92 gold

TLT 9.4% 131.88 20-year Treasury bonds

EEM 7.4% 34.57 Emerging markets

SPY 1.9% 207.78 S&P 500

IWM -0.2% 112.45 Russell 2000

I am right near the bottom at +1.3% for 2016, behind SPY, ahead of IWM, missing the fast boats of bonds, and precious metals.

The big picture is okay. I had three bad months, now one good month, and I am back to a profit for the year, and right there with the major stock indexes. I have a lot of dry powder, as I am starting to trade better. The big losers in BA, FB, UA early in the year, are what dug me a deep hole. Lately, what some see as speculative stocks: CMG, TSLA and VRX have helped me climb out of the hole. I still see myself as a cautious trader. 

 

For the astro people reading along, Mercury goes retrograde on April 28th. We will see if it marks a reversal, an acceleration, or nothing this time around. 

 

Big earnings week coming up. The CBOE blog (link) has a list of some of the optionable stocks reporting each week. So far the more interesting candidates to me are:

Tue before open: JNJ UNH

Wed after close: SKX

Thu after close: MSFT V