Comment by phil

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phil
December 3rd, 2013 at 4:57 pm

My note to Webinar people:

We had another great Webinar session and I really do love answering questions so please, take advantage of  the chance to participate when we're live on-line. 

Today's Webinar can be replayed here at any time and our model portfolios will be available on-line when you sign in at http://darwininvestingnetwork.com.  

We cashed last week's 10 TZA Dec $18 calls at $1.52 for a lovely 44.8% profit in 7 days ($470) and we added the following new positions:

Short-Term Portfolio:  

• 20 TZA Jan $19/23 bull call spreads at $1.86, selling 20 TZA Jan $17 puts for $1.50 for net .36 on the $4 spreads —  This is an aggressive hedge that pays off if the Russell drops about 5% below 1,120 to 1,064 but won't pay in full unless it's that low at Jan expiration (17th).  Still, it provides $8,000 of potential downside protection for a cash outlay of just $720/  Should TZA fall below $17 into April (down 12%) then we may be assigned ownership of the ETF, putting us short the Russell 4% over 1,120 (1,164).  
• 5 SCO Jan 32/35 bull call spreas for $1.25, selling April $30 puts for $1.50 for a net 0.25 credit — Here we are playing oil to stay below $100 over the long-term but, in the shorter-term, we are hoping OPEC fails to reach a production cutback agreement at tomorrow's meeting.  This net $125 trade can return up to $1,500 if we hit our target!  On the Downside, we could end up owning SCO (a 2x ultra-short ETF on oil) at net $28.75, very near their 5-year low.  

Long-Term Portfolio:

• 10 NLY Jan 2015 $10 puts sold for $1.85. — Very simply, we are hoping to get a net $8.15 entry on 1,000 shares of NLY.  We do believe it will go lower at some point but, if it does not, at least we collect $1,850 as a consolation prize!  

Keep an eye out for Alerts and read our Macro Market Overview for other trade ideas during the week. Monday's trade idea to play the FAZ April $24/30 bull call spread for $1.20 and sell the April $20 puts for $1.05 for a net 0.15 entry finished today (Tuesday) at net .50, which is up a quick 233% on cash!  

Our other trade ideas on Monday were to short AMZN at $400 and they finished the day at $385 for a $15 gain (3.75%) in a day and our long trade idea on FXI is still playable if you like China.  

This morning our trade idea was to be bullish in TSLA with the 2015 $80/145 bull call spread at $30.30 but the jump in TSLA put the spread at $33.80 at the open.  Still, it finished the day at $35.80 for a very nice 6% gain on the day – not a bad start!  

We don't track every trade but we do have plenty of great trade ideas all week and we have in-depth discussion of our strategies during the Weekly Webinars, which are always available for review at your leisure.  Also, you may want to follow me on Twitter, as we sometimes have important market action and trade ideas there as well.   

Should we have any adjstments to our Portfolios, you can expect an Email like this one but, hopefully, we'll make plenty of money by just leaving them alone because we are – BEING THE HOUSE, Not the Gambler!