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Fear & Greed Trader
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INDEPENDENT Financial Advisor / Professional Investor- with over 30 years of navigating the Stock market's "fear and greed" cycles that challenge the average investor. Investment strategies that combine Theory, Practice and Experience to produce Portfolios focused on achieving positive... More
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  • Call Writing Strategy Part 36 - Aug Expiration  2 comments
    Aug 18, 2014 8:26 PM | about stocks: LVS, NVDA, FCX, NUAN, EBAY

    The August Options series expired this past week and with that the (NASDAQ:NVDA) position was called away @ 19 yielding a 3% gain for that 18 day holding period. Both the (NYSE:FCX) and (NASDAQ:NUAN) options expired worthless.

    The NUAN position becomes troublesome again and its latest earnings report disappointed sending the share 10% lower on the day after that report.. So, after getting myself back to even on those shares, here we are again faced with a decision. For the moment, I will sit and hold, & wait for a rebound.

    The news is better with FCX, as it closed just below the 37 strike price and with that I was able to sell the Sept 37 strike price call today for $.52

    NVDA still looks cheap and attractive at these levels, so I decided to buy the 1500 Shares of NVDA back @ 19.22 and sell the Sept 19.50 call for $.44

    The current portfolio :

    (click to enlarge)

    To summarize; (NYSE:LVS) and (NUAN) are presently not covered and awaiting a rebound in price. (NASDAQ:EBAY), (FCX), & (NVDA) have calls written against those positions

    Current stock investment is $122,363

    Gain on the initial $100,000 investment is $30,980 since 6/5/13....for a total portfolio value of $130,980

    The same $100K invested in the S & P (spy on 6/13 - 161) would be worth (SPY @ 197 today) $122,360 ...

    Best of Luck to all !!

    Disclosure: The author is long LVS, NVDA, FCX, NUAN, EBAY.

    Additional disclosure: I am long numerous equity positions - all of which can be seen here on my SA Instablog. It is my intention to present an introduction to these securities and state my intent and position. It should be used as a 'Starting Point' to conduct your own Due Diligence before making any investment decision. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

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Comments (2)
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  • darnoc111
    , contributor
    Comments (351) | Send Message
     
    I like your idea of using options to make profits from good companies. But wouldn't it be better to go a little higher on stock price and go out 3 months or more to increase your gain or is better to just go 1 month? Also do you use charting to decide when to sell options? Thanks Darnoc.
    19 Aug, 09:33 AM Reply Like
  • Fear & Greed Trader
    , contributor
    Comments (4703) | Send Message
     
    Author’s reply » darnoc,

     

    good question, the idea, and my personal preference is to generate income and have the ability to keep the money turning over for cash flow..

     

    In my view it also doesn't lock u "all in" IF the market does start to turn dramatically .

     

    Going out a little further with higher strike prices will surely add more income , but in my view also brings in more risk..

     

    Bottom line,, if i can buy , write and then have them called , with an avg 2-3% return in a month that equates to around 30% % a year..

     

    As indicated by the $30,000 + profit since june of '13

     

    It all comes down to investor preference and comfort range.

     

    Best of luck
    19 Aug, 09:53 AM Reply Like
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