Apple Account Update

Aug. 20, 2014 1:32 PM ETAAPL2 Comments
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I am updating what happened in my 3 accounts concerning Apple. As a refresher, account #1 is buy and hold, account #2 is writing covered calls, account #3 is buying calls or puts only.

Here is how the performed from when I started keeping track 8/11/2014.

Account #1 - Buy and hold 100 shares AAPL 1 yr

8/11/2014 $9,515.95
8/20/2014 $10,049.00

Total gain $533.05

Account #2 Covered Calls

8/11/2014 $9549.73
8/15/2014 $9643.00

Total gain $93.27

Account #3 Calls & Puts - buy an equivalent amount of calls or puts to approximate the delta of 100 shares

8/11/2014 $696.00
8/20/2014 $1420.00

Total gain $724.00

I stopped Account #2 right away, I don't ever foresee this strategy being worthwhile. And this is after I thought #2 would be the winner in dollars gained after a year in my first instablog.

Go Long Covered Calls Cash Secured Puts Delta matched Calls / Puts
Commissions 1 4 3 2
Taxes 1 4 3 2
Upside Potential 1 3 4 2
Downside Potential 4 3 3 1
Dividends 1 4 4 4
Total 8 18 17 11

Items are ranked according to 1 is best, 4 is worst
Lower Total is better

There is no reason in my mind to use covered calls for capital appreciation, which is my purpose at this time. I learned this the hard way.

My strategy going forward will consist of going long stock, going long calls or puts, or selling an item. I plan to focus primarily on calls and puts as I will match the delta of a stock only position but the
amount of capital at risk is significantly reduced (inherent leverage of options).

Analyst’s Disclosure: The author is long AAPL.

Author may buy or sell AAPL or AAPL calls or puts at any time.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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