So here we are at the end of the month and forced to deal with our losing positions as we prepare to shut down our virtual portfolio as we reset with a clean $10,000 on Monday.
BUD is a very dead looking play and there’s not much to do but hold it and pray for a miracle. The time for micacles is past for DELL and those calls expire worthless today. Our NDAQ play is right on track and the caller will either expire worthless or we will buy him out and we will transfer the naked $42.50 puts to the STP but, as a $10KP player, we cannot tolerate a loss here so we need to set a stop at $2.10 and look to take at least 1/2 off the table should we get lucky enough to get to $3.
SNDK was a spread and took a big hit yesterday so we’re going to try to be brave while we wait for the Mar $27.50s to get back to at least $1.50, where we will sell 8 of 12 contracts to cover. Should the position turn down on us, we only need to sell 8 March $25s to pay for a roll to the April $25s on our longer legs so that’s our backup plan.
AMGN was kind enough to wipe out our caller and he will either expire worthless or be taken out today so we can afford to wait and see next week before deciding what to do next. We can get $3.10 for the March $45s and just 5 of those would pay for our roll down to the April $45s so there’s no reason for us to worry on this already beaten-down position.
ERTS looks just fine and we’ll take advantage of the very nice premium being offered on the Mar $50s to roll our 5 Feb $45 callers up to 10 Mar $50 callers for a net cost of .30 for each of the 5 (.40 is the most you should pay). We will roll our 5 June $45 calls at $6.60 to 10 June $50 calls at $3.90, which will cost us $1.20 per original contract. The net effect of this is that we are spending $800 for the roll rather than paying our caller the $1,210 we owe him but we are spending the bulk of that money on increasing the value of our own, longer position (our 10 new calls will be worth $3,900 vs. the $3,250 value of our current $45s). We also increase the amount of premium dollars collected per month from our original $600 in February to $1,600 in March. While we didn’t "win" on this position this month, we have certainly set ourselves up for a potentially much greater win at the next expiration.
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Notes Stop Limits |
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BUDCK | Mar 55 CALL [BUD @ $47.84 $-0.17] | 5 | 11/30/2007 | (36) | $760.00 | $1.50 | $-1.45 | $0.05 | – | $-735.00 | -96.7% | $25.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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DLQBF | Feb 30 CALL [DELL @ $19.81 $-0.50] | 10 | 11/29/2007 | (1) | $1,210.00 | $1.20 | $-1.20 | $0.00 | – | $-1,210.00 | -100.0% | $0.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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NQDCV | Mar 42.5 CALL [NDAQ @ $42.24 $0.03] | 7 | 2/6/2008 | (36) | $1,463.00 | $2.09 | $0.31 | $2.40 | $0.00 | $217.00 | 14.8% | $1,680.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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SWQDE | Apr 25 CALL [SNDK @ $26.06 $-1.05] | 12 | 1/25/2008 | (64) | $3,982.00 | $3.31 | $-0.31 | $3.00 | $-0.80 | $-382.00 | -9.6% | $3,600.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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AMQDW | Apr 47.5 CALL [AMGN @ $46.77 $-0.29] | 10 | 12/17/2007 | (64) | $4,230.00 | $4.22 | $-2.02 | $2.20 | $-0.06 | $-2,030.00 | -48.0% | $2,200.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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AMQBW | Feb 47.5 CALL [AMGN @ $46.77 $-0.29] | -10 | 2/6/2008 | (1) | $-740.00 | $0.75 | $-0.69 | $0.06 | $-0.14 | $680.00 | 91.9% | $-60.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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EZQFI | Jun 45 CALL [ERTS @ $48.43 $-0.44] | 5 | 2/7/2008 | (127) | $2,010.00 | $4.00 | $2.50 | $6.50 | $-0.30 | $1,240.00 | 61.7% | $3,250.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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EZQBI | Feb 45 CALL [ERTS @ $48.43 $-0.44] | -5 | 2/7/2008 | (1) | $-590.00 | $1.20 | $2.40 | $3.60 | $-0.20 | $-1,210.00 | -205.1% | $-1,800.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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NQDCV | Mar 42.5 CALL [NDAQ @ $42.24 $0.03] | 3 | 2/6/2008 | (36) | $862.00 | $2.84 | $-0.44 | $2.40 | $0.00 | $-142.00 | -16.5% | $720.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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NQDBV | Feb 42.5 CALL [NDAQ @ $42.24 $0.03] | -3 | 2/6/2008 | (1) | $-410.00 | $1.40 | $-1.00 | $0.40 | $-0.05 | $290.00 | 70.7% | $-120.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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