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August 14th, 2008 at 7:57 am
Allan – how are you doing your performance calculation? I opened my SPY on 7/8, all legs at 125 strike, and according to my calculation I have a 23% gain. I rolled the jul shorts to aug on 7/18. If I look at it purely from a cash flow perspective in computing the basis, I’m at 2,491 per contract. If I compute the gain adding closed leg gain/loss plus current gain/loss based on market prices, I have a $589 gain per contract. That’s a bit higher than 6.7%. Of course my basis counts the entire short sale proceeds, but the intention is to harvest "most" of that so I don’t think that’s too wild an assumption. My first shorts were harvested at 77% and 88% gains on the short call and put side respectively.