[Weekend Summary]
Dear Member:
This was a good week for Option Trader, Trend Trader, and $10 Trader where I was able to close profitable trades in each. The markets were cooperative and each of the major averages was up though fairly modestly. Volatilities remained low so it appears that the bulls remain in control. We are now in earnings season so we'll be seeing the release of a lot of fundamental information regarding individual stocks in the coming weeks. For now, sentiment appears to remain on the bullish side.
I enjoyed a really good return on my LEAPS position in Usec, Inc. (USU) when I was able to capture a 24% return before commission in just 3 business days.
I closed my LEAPS position in Anadarko Petroleum (APC) before April expiration for a profit. The '08 LEAPS will convert to regular options soon and time value will decay more rapidly from not until those options expire. Even though APC dropped in price from the time I made my initial entry, I was able to enjoy an overall profit because I had sold and bought back calls against my underlying LEAPS call position a couple of times during the course of the trade. This one was definitely an example of making lemonade out of lemons. The final profit was 6.6%.
All the spreads I have in place are still OK for now. McGraw-Hill (MHP) in which I was getting ready to make an adjustment bounced yesterday and again today. SPY moved up for the week and Citigroup (C) was essentially flat.
I still have my small hedge position with puts on the Q's. QQQQ was up this week, but only about 9 cents so I am sticking with the protection.
Sirius Satellite Radio (SIRI) has been a disappointment. It is doing little and I would like to see some movement to jar volatility a bit so that I could get some more premium by again selling calls against my '09 $2.50 LEAPS calls as I did with APC. There is plenty of time, however, and I have no reason to be impatient.
Have a wonderful weekend.
Bill
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