1. Keep my Original Position
2. Keep my premium on my CC
3. Get put to 200 more shares at a pretty good price
4. Keep my premium on my CC

IF the Stock Closes ABOVE 40.00 today - I'm all in cash

1. I get called away on my Original Position
2. Keep my premium on my CC
3. Do NOT get put on my CSP
4. Keep my premium on my CSP

Then I got coffee, breakfast, little exercise, a shower, sat down to watch the Market and said, "WTF MATE?" The 200+ drop had commenced and all boats go aground when the tide goes out. I started watching RMD edge down, up, down, really down and then slowly up.

I wrote out my journal. As I was writing out the above, I came to the awareness that: 1) RMD was going to post earnings on the 25th and could have a good day (earnings have been good to the market except for Friday), 2) that my "all stock or all cash" scenario was green felt logic. I decided to unwind this pickle.

I waited until the last hour of the Market - I don't know why, guess it was just hoping that the dice would turn and show me the right way. RMD was showing a LOT of resistance to going below 40.00 but also a lot of resistance to going higher than... oh, 40.15. So, I bought back my CC.

10/19/12 BTC 4x 10/20/12 40.00 CC @ 0.40 APR (uhm, spreadsheet and I really were not on speaking terms), net -184

This way I effectively cut one leg off my Green Felt Spread - I could only have 200 shares put to me if the price closed below 40.00 in 30 minutes.

Tick

Tock

Market gets slammed down 2% and RMD closes at.... 40.11/share... or as we say here... A Natural Eleven.

I made 389-184+351 = $556 in 19 days. APR... wow, don't really know if I care... I'm just happy that my dice game didn't leave me with a lousy t-shirt, a bus ticket and a long ride home.

I have to be more disciplined if I'm going to play in this arena and pay attention to the safety rules of the game. It was entertaining, educational and by lady luck, profitable. But luck favors the prepared - those with knowledge and respect to use it wisely... and sometimes me.

Rules:

1. Don't loose money.
2. Don't trade above your intellect or education, preferably below both.
3. Don't trade across Event Horizons - same effect as singularities (no one really knows what happens)
4. Do keep good notes so you can review.
5. Do keep learning.
6. add to this list.

Hope everyone has a great weekend - pet the kids, play catch with the wife, go out to dinner with dog.. er... tip your waitress.

Malcolm

----- Original Message -----

From: Malcolm Myles

To: COOL_Club@bivio.com

Sent: Saturday, October 20, 2012 6:16 PM

Subject: [cool_club] October Expiration Experience

Hi All,

I had an interesting day this last Friday which I'd like to share for your entertainment - I will not call it an investing experience because it was, as we say here in Reno, a pass at the green felt... I rolled the dice.

I have 400 shares of RESMED, Inc (RMD) a medical manufacture of CPAP (Continuous Positive Airway Pressure) machines - you know, the ones every overweight, type II diabetic in the US is getting so they don't wake up with headaches and panic their spouses when they stop breathing at night?  Well, I think these devices are going to be more common than corkscrews in the Baby Boomer households - my Dad has two and a travel version.

So I looked into writing a CC on the position to earn more income.  Risk was minimal, IMO, as the stock had an earnings date AFTER the expiration date and the stock had traded trending up or sideways for two months.  I know enough about technicals to understand that I don't know enough about technicals.

I was very worried about writing a call when I check the availability - there were only two calls OOTM... a 40 and 45 and VERY thin volume.  The premiums didn't amount to much so I watched.  I debated on writing a position with a good till cancel limit, and finally decided to set a price and go on vacation.  The CC was written while I was sucking up Vitamin D on dead, ground up coral.  I didn't catch it until a couple days later.

    9/18/12 STO 4x 10/20/12 40.00 CC @ 1.00   APR 28%, net $389

Okay, so good so far, but then I went to look at why it had filled - the price was moving up again!  The price stumbled up over 40 and staggered around there like it was setting a new support limit or something.  But I had time, however, to watch this thing and decide what to do.

Friday, the 19th, Option Expiration Day... My Pass at the Green Felt.

I decided that I really didn't want to loose my position.  I got up and started breaking rules, put on my green visor and started rolling the dice.

In the first hour of the Market Open, I wrote a CSP. (Never trade in the sunrise or sunset of the Market, the light is bad and provided more heat than illumination.)

    10/19/12 STO 2x 10/20/12 40.00 CSP @ 1.80   APR (Spreadsheet said go away junior, I'm busy), net $351.05

Here was my caffeine deprived logic:

    IF the Stock Closes BELOW 40.00 today - I'm all in stock

1. Keep my Original Position
2. Keep my premium on my CC
3. Get put to 200 more shares at a pretty good price
4. Keep my premium on my CC

    IF the Stock Closes ABOVE 40.00 today - I'm all in cash

1. I get called away on my Original Position
2. Keep my premium on my CC
3. Do NOT get put on my CSP
4. Keep my premium on my CSP

Then I got coffee, breakfast, little exercise, a shower, sat down to watch the Market and said, "WTF MATE?"  The 200+ drop had commenced and all boats go aground when the tide goes out.  I started watching RMD edge down, up, down, really down and then slowly up. 

I wrote out my journal. As I was writing out the above, I came to the awareness that: 1) RMD was going to post earnings on the 25th and could have a good day (earnings have been good to the market except for Friday), 2) that my "all stock or all cash" scenario was green felt logic.  I decided to unwind this pickle.

I waited until the last hour of the Market - I don't know why, guess it was just hoping that the dice would turn and show me the right way.  RMD was showing a LOT of resistance to going below 40.00 but also a lot of resistance to going higher than... oh, 40.15.  So,  I bought back my CC.

    10/19/12 BTC 4x 10/20/12 40.00 CC @ 0.40   APR (uhm, spreadsheet and I really were not on speaking terms), net -184

This way I effectively cut one leg off my Green Felt Spread - I could only have 200 shares put to me if the price closed below 40.00 in 30 minutes.

Tick

Tock

Market gets slammed down 2% and RMD closes at.... 40.11/share... or as we say here... A Natural Eleven.

I made 389-184+351 = $556 in 19 days.  APR... wow, don't really know if I care... I'm just happy that my dice game didn't leave me with a lousy t-shirt, a bus ticket and a long ride home.

I have to be more disciplined if I'm going to play in this arena and pay attention to the safety rules of the game.  It was entertaining, educational and by lady luck, profitable.  But luck favors the prepared - those with knowledge and respect to use it wisely... and sometimes me.

Rules:

1. Don't loose money.
2. Don't trade above your intellect or education, preferably below both.
3. Don't trade across Event Horizons - same effect as singularities (no one really knows what happens)
4. Do keep good notes so you can review.
5. Do keep learning.
6. add to this list.

Hope everyone has a great weekend - pet the kids, play catch with the wife, go out to dinner with dog.. er... tip your waitress.

Malcolm

----- Original Message -----

From: Art Christensen

To: cool_club@bivio.com

Sent: Saturday, October 20, 2012 7:59 PM

Subject: Re: [cool_club] October Expiration Experience

HI Malcolm

For the dimmer bulbs on the street among us do you know of a list of Stock Options acronyms, like CSP for example? I know the other acronyms in this post but this one left me cold and searching for it on the web gave all kindfs of other crap but couldn't spot this one.

Just learning.

Thanks

Art

----- Original Message -----

From: Malcolm Myles

To: COOL_Club@bivio.com

Sent: Saturday, October 20, 2012 6:16 PM

Subject: [cool_club] October Expiration Experience

Hi All,

I had an interesting day this last Friday which I'd like to share for your entertainment - I will not call it an investing experience because it was, as we say here in Reno, a pass at the green felt... I rolled the dice.

I have 400 shares of RESMED, Inc (RMD) a medical manufacture of CPAP (Continuous Positive Airway Pressure) machines - you know, the ones every overweight, type II diabetic in the US is getting so they don't wake up with headaches and panic their spouses when they stop breathing at night?  Well, I think these devices are going to be more common than corkscrews in the Baby Boomer households - my Dad has two and a travel version.

So I looked into writing a CC on the position to earn more income.  Risk was minimal, IMO, as the stock had an earnings date AFTER the expiration date and the stock had traded trending up or sideways for two months.  I know enough about technicals to understand that I don't know enough about technicals.

I was very worried about writing a call when I check the availability - there were only two calls OOTM... a 40 and 45 and VERY thin volume.  The premiums didn't amount to much so I watched.  I debated on writing a position with a good till cancel limit, and finally decided to set a price and go on vacation.  The CC was written while I was sucking up Vitamin D on dead, ground up coral.  I didn't catch it until a couple days later.

    9/18/12 STO 4x 10/20/12 40.00 CC @ 1.00   APR 28%, net $389

Okay, so good so far, but then I went to look at why it had filled - the price was moving up again!  The price stumbled up over 40 and staggered around there like it was setting a new support limit or something.  But I had time, however, to watch this thing and decide what to do.

Friday, the 19th, Option Expiration Day... My Pass at the Green Felt.

I decided that I really didn't want to loose my position.  I got up and started breaking rules, put on my green visor and started rolling the dice.

In the first hour of the Market Open, I wrote a CSP. (Never trade in the sunrise or sunset of the Market, the light is bad and provided more heat than illumination.)

    10/19/12 STO 2x 10/20/12 40.00 CSP @ 1.80   APR (Spreadsheet said go away junior, I'm busy), net $351.05

Here was my caffeine deprived logic:

    IF the Stock Closes BELOW 40.00 today - I'm all in stock

1. Keep my Original Position
2. Keep my premium on my CC
3. Get put to 200 more shares at a pretty good price
4. Keep my premium on my CC

    IF the Stock Closes ABOVE 40.00 today - I'm all in cash

1. I get called away on my Original Position
2. Keep my premium on my CC
3. Do NOT get put on my CSP
4. Keep my premium on my CSP

Then I got coffee, breakfast, little exercise, a shower, sat down to watch the Market and said, "WTF MATE?"  The 200+ drop had commenced and all boats go aground when the tide goes out.  I started watching RMD edge down, up, down, really down and then slowly up. 

I wrote out my journal. As I was writing out the above, I came to the awareness that: 1) RMD was going to post earnings on the 25th and could have a good day (earnings have been good to the market except for Friday), 2) that my "all stock or all cash" scenario was green felt logic.  I decided to unwind this pickle.

I waited until the last hour of the Market - I don't know why, guess it was just hoping that the dice would turn and show me the right way.  RMD was showing a LOT of resistance to going below 40.00 but also a lot of resistance to going higher than... oh, 40.15.  So,  I bought back my CC.

    10/19/12 BTC 4x 10/20/12 40.00 CC @ 0.40   APR (uhm, spreadsheet and I really were not on speaking terms), net -184

This way I effectively cut one leg off my Green Felt Spread - I could only have 200 shares put to me if the price closed below 40.00 in 30 minutes.

Tick

Tock

Market gets slammed down 2% and RMD closes at.... 40.11/share... or as we say here... A Natural Eleven.

I made 389-184+351 = $556 in 19 days.  APR... wow, don't really know if I care... I'm just happy that my dice game didn't leave me with a lousy t-shirt, a bus ticket and a long ride home.

I have to be more disciplined if I'm going to play in this arena and pay attention to the safety rules of the game.  It was entertaining, educational and by lady luck, profitable.  But luck favors the prepared - those with knowledge and respect to use it wisely... and sometimes me.

Rules:

1. Don't loose money.
2. Don't trade above your intellect or education, preferably below both.
3. Don't trade across Event Horizons - same effect as singularities (no one really knows what happens)
4. Do keep good notes so you can review.
5. Do keep learning.
6. add to this list.

Hope everyone has a great weekend - pet the kids, play catch with the wife, go out to dinner with dog.. er... tip your waitress.

Malcolm

----- Original Message -----

From: Art Christensen

To: cool_club@bivio.com

Sent: Saturday, October 20, 2012 9:59 PM

Subject: [Norton AntiSpam]Re: [cool_club] October Expiration Experience

HI Malcolm

For the dimmer bulbs on the street among us do you know of a list of Stock Options acronyms, like CSP for example? I know the other acronyms in this post but this one left me cold and searching for it on the web gave all kindfs of other crap but couldn't spot this one.

Just learning.

Thanks

Art

----- Original Message -----

From: Malcolm Myles

To: COOL_Club@bivio.com

Sent: Saturday, October 20, 2012 6:16 PM

Subject: [cool_club] October Expiration Experience

Hi All,

I had an interesting day this last Friday which I'd like to share for your entertainment - I will not call it an investing experience because it was, as we say here in Reno, a pass at the green felt... I rolled the dice.

I have 400 shares of RESMED, Inc (RMD) a medical manufacture of CPAP (Continuous Positive Airway Pressure) machines - you know, the ones every overweight, type II diabetic in the US is getting so they don't wake up with headaches and panic their spouses when they stop breathing at night?  Well, I think these devices are going to be more common than corkscrews in the Baby Boomer households - my Dad has two and a travel version.

So I looked into writing a CC on the position to earn more income.  Risk was minimal, IMO, as the stock had an earnings date AFTER the expiration date and the stock had traded trending up or sideways for two months.  I know enough about technicals to understand that I don't know enough about technicals.

I was very worried about writing a call when I check the availability - there were only two calls OOTM... a 40 and 45 and VERY thin volume.  The premiums didn't amount to much so I watched.  I debated on writing a position with a good till cancel limit, and finally decided to set a price and go on vacation.  The CC was written while I was sucking up Vitamin D on dead, ground up coral.  I didn't catch it until a couple days later.

    9/18/12 STO 4x 10/20/12 40.00 CC @ 1.00   APR 28%, net $389

Okay, so good so far, but then I went to look at why it had filled - the price was moving up again!  The price stumbled up over 40 and staggered around there like it was setting a new support limit or something.  But I had time, however, to watch this thing and decide what to do.

Friday, the 19th, Option Expiration Day... My Pass at the Green Felt.

I decided that I really didn't want to loose my position.  I got up and started breaking rules, put on my green visor and started rolling the dice.

In the first hour of the Market Open, I wrote a CSP. (Never trade in the sunrise or sunset of the Market, the light is bad and provided more heat than illumination.)

    10/19/12 STO 2x 10/20/12 40.00 CSP @ 1.80   APR (Spreadsheet said go away junior, I'm busy), net $351.05

Here was my caffeine deprived logic:

    IF the Stock Closes BELOW 40.00 today - I'm all in stock

1. Keep my Original Position
2. Keep my premium on my CC
3. Get put to 200 more shares at a pretty good price
4. Keep my premium on my CC

    IF the Stock Closes ABOVE 40.00 today - I'm all in cash

1. I get called away on my Original Position
2. Keep my premium on my CC
3. Do NOT get put on my CSP
4. Keep my premium on my CSP

Then I got coffee, breakfast, little exercise, a shower, sat down to watch the Market and said, "WTF MATE?"  The 200+ drop had commenced and all boats go aground when the tide goes out.  I started watching RMD edge down, up, down, really down and then slowly up. 

I wrote out my journal. As I was writing out the above, I came to the awareness that: 1) RMD was going to post earnings on the 25th and could have a good day (earnings have been good to the market except for Friday), 2) that my "all stock or all cash" scenario was green felt logic.  I decided to unwind this pickle.

I waited until the last hour of the Market - I don't know why, guess it was just hoping that the dice would turn and show me the right way.  RMD was showing a LOT of resistance to going below 40.00 but also a lot of resistance to going higher than... oh, 40.15.  So,  I bought back my CC.

    10/19/12 BTC 4x 10/20/12 40.00 CC @ 0.40   APR (uhm, spreadsheet and I really were not on speaking terms), net -184

This way I effectively cut one leg off my Green Felt Spread - I could only have 200 shares put to me if the price closed below 40.00 in 30 minutes.

Tick

Tock

Market gets slammed down 2% and RMD closes at.... 40.11/share... or as we say here... A Natural Eleven.

I made 389-184+351 = $556 in 19 days.  APR... wow, don't really know if I care... I'm just happy that my dice game didn't leave me with a lousy t-shirt, a bus ticket and a long ride home.

I have to be more disciplined if I'm going to play in this arena and pay attention to the safety rules of the game.  It was entertaining, educational and by lady luck, profitable.  But luck favors the prepared - those with knowledge and respect to use it wisely... and sometimes me.

Rules:

1. Don't loose money.
2. Don't trade above your intellect or education, preferably below both.
3. Don't trade across Event Horizons - same effect as singularities (no one really knows what happens)
4. Do keep good notes so you can review.
5. Do keep learning.
6. add to this list.

Hope everyone has a great weekend - pet the kids, play catch with the wife, go out to dinner with dog.. er... tip your waitress.

Malcolm

CSP - Cash Secured Put! That drifted into my mind about 5 this morning when I was about half awake.

Art

 

----- Original Message -----

From: Art Christensen

To: cool_club@bivio.com

Sent: Saturday, October 20, 2012 9:59 PM

Subject: [Norton AntiSpam]Re: [cool_club] October Expiration Experience

HI Malcolm

For the dimmer bulbs on the street among us do you know of a list of Stock Options acronyms, like CSP for example? I know the other acronyms in this post but this one left me cold and searching for it on the web gave all kindfs of other crap but couldn't spot this one.

Just learning.

Thanks

Art

----- Original Message -----

From: Malcolm Myles

To: COOL_Club@bivio.com

Sent: Saturday, October 20, 2012 6:16 PM

Subject: [cool_club] October Expiration Experience

Hi All,

I had an interesting day this last Friday which I'd like to share for your entertainment - I will not call it an investing experience because it was, as we say here in Reno, a pass at the green felt... I rolled the dice.

I have 400 shares of RESMED, Inc (RMD) a medical manufacture of CPAP (Continuous Positive Airway Pressure) machines - you know, the ones every overweight, type II diabetic in the US is getting so they don't wake up with headaches and panic their spouses when they stop breathing at night?  Well, I think these devices are going to be more common than corkscrews in the Baby Boomer households - my Dad has two and a travel version.

So I looked into writing a CC on the position to earn more income.  Risk was minimal, IMO, as the stock had an earnings date AFTER the expiration date and the stock had traded trending up or sideways for two months.  I know enough about technicals to understand that I don't know enough about technicals.

I was very worried about writing a call when I check the availability - there were only two calls OOTM... a 40 and 45 and VERY thin volume.  The premiums didn't amount to much so I watched.  I debated on writing a position with a good till cancel limit, and finally decided to set a price and go on vacation.  The CC was written while I was sucking up Vitamin D on dead, ground up coral.  I didn't catch it until a couple days later.

    9/18/12 STO 4x 10/20/12 40.00 CC @ 1.00   APR 28%, net $389

Okay, so good so far, but then I went to look at why it had filled - the price was moving up again!  The price stumbled up over 40 and staggered around there like it was setting a new support limit or something.  But I had time, however, to watch this thing and decide what to do.

Friday, the 19th, Option Expiration Day... My Pass at the Green Felt.

I decided that I really didn't want to loose my position.  I got up and started breaking rules, put on my green visor and started rolling the dice.

In the first hour of the Market Open, I wrote a CSP. (Never trade in the sunrise or sunset of the Market, the light is bad and provided more heat than illumination.)

    10/19/12 STO 2x 10/20/12 40.00 CSP @ 1.80   APR (Spreadsheet said go away junior, I'm busy), net $351.05

Here was my caffeine deprived logic:

    IF the Stock Closes BELOW 40.00 today - I'm all in stock

1. Keep my Original Position
2. Keep my premium on my CC
3. Get put to 200 more shares at a pretty good price
4. Keep my premium on my CC

    IF the Stock Closes ABOVE 40.00 today - I'm all in cash

1. I get called away on my Original Position
2. Keep my premium on my CC
3. Do NOT get put on my CSP
4. Keep my premium on my CSP

Then I got coffee, breakfast, little exercise, a shower, sat down to watch the Market and said, "WTF MATE?"  The 200+ drop had commenced and all boats go aground when the tide goes out.  I started watching RMD edge down, up, down, really down and then slowly up. 

I wrote out my journal. As I was writing out the above, I came to the awareness that: 1) RMD was going to post earnings on the 25th and could have a good day (earnings have been good to the market except for Friday), 2) that my "all stock or all cash" scenario was green felt logic.  I decided to unwind this pickle.

I waited until the last hour of the Market - I don't know why, guess it was just hoping that the dice would turn and show me the right way.  RMD was showing a LOT of resistance to going below 40.00 but also a lot of resistance to going higher than... oh, 40.15.  So,  I bought back my CC.

    10/19/12 BTC 4x 10/20/12 40.00 CC @ 0.40   APR (uhm, spreadsheet and I really were not on speaking terms), net -184

This way I effectively cut one leg off my Green Felt Spread - I could only have 200 shares put to me if the price closed below 40.00 in 30 minutes.

Tick

Tock

Market gets slammed down 2% and RMD closes at.... 40.11/share... or as we say here... A Natural Eleven.

I made 389-184+351 = $556 in 19 days.  APR... wow, don't really know if I care... I'm just happy that my dice game didn't leave me with a lousy t-shirt, a bus ticket and a long ride home.

I have to be more disciplined if I'm going to play in this arena and pay attention to the safety rules of the game.  It was entertaining, educational and by lady luck, profitable.  But luck favors the prepared - those with knowledge and respect to use it wisely... and sometimes me.

Rules:

1. Don't loose money.
2. Don't trade above your intellect or education, preferably below both.
3. Don't trade across Event Horizons - same effect as singularities (no one really knows what happens)
4. Do keep good notes so you can review.
5. Do keep learning.
6. add to this list.

Hope everyone has a great weekend - pet the kids, play catch with the wife, go out to dinner with dog.. er... tip your waitress.

Malcolm

----- Original Message -----

From: charles brunell

To: cool_club@bivio.com

Sent: Sunday, October 21, 2012 6:16 AM

Subject: Re: [cool_club] October Expiration Experience

Art, I think it means cash secured put.

 

CHUCK B

From: Art Christensen <artchris@somtel.net>
To: cool_club@bivio.com
Sent: Saturday, October 20, 2012 10:59 PM
Subject: Re: [cool_club] October Expiration Experience



HI Malcolm

For the dimmer bulbs on the street among us do you know of a list of Stock Options acronyms, like CSP for example? I know the other acronyms in this post but this one left me cold and searching for it on the web gave all kindfs of other crap but couldn't spot this one.

Just learning.

Thanks

Art

----- Original Message -----

From: Malcolm Myles

To: COOL_Club@bivio.com

Sent: Saturday, October 20, 2012 6:16 PM

Subject: [cool_club] October Expiration Experience

Hi All,

I had an interesting day this last Friday which I'd like to share for your entertainment - I will not call it an investing experience because it was, as we say here in Reno, a pass at the green felt... I rolled the dice.

I have 400 shares of RESMED, Inc (RMD) a medical manufacture of CPAP (Continuous Positive Airway Pressure) machines - you know, the ones every overweight, type II diabetic in the US is getting so they don't wake up with headaches and panic their spouses when they stop breathing at night?  Well, I think these devices are going to be more common than corkscrews in the Baby Boomer households - my Dad has two and a travel version.

So I looked into writing a CC on the position to earn more income.  Risk was minimal, IMO, as the stock had an earnings date AFTER the expiration date and the stock had traded trending up or sideways for two months.  I know enough about technicals to understand that I don't know enough about technicals.

I was very worried about writing a call when I check the availability - there were only two calls OOTM... a 40 and 45 and VERY thin volume.  The premiums didn't amount to much so I watched.  I debated on writing a position with a good till cancel limit, and finally decided to set a price and go on vacation.  The CC was written while I was sucking up Vitamin D on dead, ground up coral.  I didn't catch it until a couple days later.

    9/18/12 STO 4x 10/20/12 40.00 CC @ 1.00   APR 28%, net $389

Okay, so good so far, but then I went to look at why it had filled - the price was moving up again!  The price stumbled up over 40 and staggered around there like it was setting a new support limit or something.  But I had time, however, to watch this thing and decide what to do.

Friday, the 19th, Option Expiration Day... My Pass at the Green Felt.

I decided that I really didn't want to loose my position.  I got up and started breaking rules, put on my green visor and started rolling the dice.

In the first hour of the Market Open, I wrote a CSP. (Never trade in the sunrise or sunset of the Market, the light is bad and provided more heat than illumination.)

    10/19/12 STO 2x 10/20/12 40.00 CSP @ 1.80   APR (Spreadsheet said go away junior, I'm busy), net $351.05

Here was my caffeine deprived logic:

    IF the Stock Closes BELOW 40.00 today - I'm all in stock

1. Keep my Original Position
2. Keep my premium on my CC
3. Get put to 200 more shares at a pretty good price
4. Keep my premium on my CC

    IF the Stock Closes ABOVE 40.00 today - I'm all in cash

1. I get called away on my Original Position
2. Keep my premium on my CC
3. Do NOT get put on my CSP
4. Keep my premium on my CSP

Then I got coffee, breakfast, little exercise, a shower, sat down to watch the Market and said, "WTF MATE?"  The 200+ drop had commenced and all boats go aground when the tide goes out.  I started watching RMD edge down, up, down, really down and then slowly up. 

I wrote out my journal. As I was writing out the above, I came to the awareness that: 1) RMD was going to post earnings on the 25th and could have a good day (earnings have been good to the market except for Friday), 2) that my "all stock or all cash" scenario was green felt logic.  I decided to unwind this pickle.

I waited until the last hour of the Market - I don't know why, guess it was just hoping that the dice would turn and show me the right way.  RMD was showing a LOT of resistance to going below 40.00 but also a lot of resistance to going higher than... oh, 40.15.  So,  I bought back my CC.

    10/19/12 BTC 4x 10/20/12 40.00 CC @ 0.40   APR (uhm, spreadsheet and I really were not on speaking terms), net -184

This way I effectively cut one leg off my Green Felt Spread - I could only have 200 shares put to me if the price closed below 40.00 in 30 minutes.

Tick

Tock

Market gets slammed down 2% and RMD closes at.... 40.11/share... or as we say here... A Natural Eleven.

I made 389-184+351 = $556 in 19 days.  APR... wow, don't really know if I care... I'm just happy that my dice game didn't leave me with a lousy t-shirt, a bus ticket and a long ride home.

I have to be more disciplined if I'm going to play in this arena and pay attention to the safety rules of the game.  It was entertaining, educational and by lady luck, profitable.  But luck favors the prepared - those with knowledge and respect to use it wisely... and sometimes me.

Rules:

1. Don't loose money.
2. Don't trade above your intellect or education, preferably below both.
3. Don't trade across Event Horizons - same effect as singularities (no one really knows what happens)
4. Do keep good notes so you can review.
5. Do keep learning.
6. add to this list.

Hope everyone has a great weekend - pet the kids, play catch with the wife, go out to dinner with dog.. er... tip your waitress.

Malcolm

In the first hour of the Market Open, I wrote a CSP. (Never trade in the sunrise or sunset of the Market, the light is bad and provided more heat than illumination.)

10/19/12 STO 2x 10/20/12 40.00 CSP @ 1.80 APR (Spreadsheet said go away junior, I'm busy), net $351.05

ResMed (RMD) shed 3% in above-average volume, falling below its 50-day moving average. The maker of medical equipment for sleep disorders has been testing its 50-day line for the first time since a breakout in August. It's No. 5 in the latest IBD 50 lineup.