SPY
Hi Clubbers
At the last meeting, I think it was Malcom, that asked if i would write up one of my SPY trades. So here goes. Yesterday afternoon I STO 5 puts with a 155.50 strike, .72 premium, APR 41%. At the time of the sale the SPY was trading at 155.76.
I kind of think that Malcom and I are thinking along the same lines. He's using APPL and I'm using SPY as my instrument. I'm still tinkering with my stragtegy as to how far out the money to be or when to be at the money, trying to incorporate bollingr bands. In other words I really don't know what I'm doing!
Any thoughts or comments would be appreciated.
Any thoughts or comments would be appreciated.CHUCK B
Hi Chuck,
If you are making money, then it is working for you.
The only reason I encourage selling Cash-Secured PUTs when the price has moved down to a lower Bollinger Band is because if the security is PUT to you then your downside exposure may not be quite as significant. The price has already moved from the top of the range to the bottom of the range. That does not mean it will not go down further but it may mean there is more upside potential than downside risk.
If you sell Cash-Secured PUTs above the lower range it just means your basis, if it is PUT to you, will be at a higher level. This may mean that if the security moves into a downtrend for a while, (something that often happens in the spring of the year ..."sell in May and go away"), you may have to wait longer for an uptrend that will allow you to sell Covered CALLs above your basis..
The trade off on doing SPYs rather than Apple is risk to reward. Apple is more volatile than SPY which means better premiums on options. But Apple is subject to much bigger price swings. For instance It is currently almost 40% off it's 52-week highs from last September. We normally do not see quite as big price moves on the broad market index (SPY), so the downside risk if SPY is PUT to us is not as large.
Thanks for sharing your SPY trade as hearing other's experiences helps all of us learn. That is how we can develop unique strategies that work for us as individuals. Keep us posted on how the trade works for you.
Paul Madison
On Tue, Apr 2, 2013 at 3:24 PM, charles brunell <cbrunelll@yahoo.com> wrote:
Hi ClubbersAt the last meeting, I think it was Malcom, that asked if i would write up one of my SPY trades. So here goes. Yesterday afternoon I STO 5 puts with a 155.50 strike, .72 premium, APR 41%. At the time of the sale the SPY was trading at 155.76.I kind of think that Malcom and I are thinking along the same lines. He's using APPL and I'm using SPY as my instrument. I'm still tinkering with my stragtegy as to how far out the money to be or when to be at the money, trying to incorporate bollingr bands. In other words I really don't know what I'm doing!Any thoughts or comments would be appreciated.
CHUCK B
Paul Madison
If you guys recall on Monday I STO 5 puts with a 155.50 strike, .72 premium. Today the SPY closed at 155.19. So it will be put to me this weekend, and I will be looking to sell some calls next week.
CHUCK B
From: Paul Madison <TheCOOLClubDude@gmail.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Wednesday, April 3, 2013 12:35 PM
Subject: Re: [cool_club] SPY
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Wednesday, April 3, 2013 12:35 PM
Subject: Re: [cool_club] SPY
Hi Chuck,
If you are making money, then it is working for you.
The only reason I encourage selling Cash-Secured PUTs when the price has moved down to a lower Bollinger Band is because if the security is PUT to you then your downside exposure may not be quite as significant. The price has already moved from the top of the range to the bottom of the range. That does not mean it will not go down further but it may mean there is more upside potential than downside risk.
If you sell Cash-Secured PUTs above the lower range it just means your basis, if it is PUT to you, will be at a higher level. This may mean that if the security moves into a downtrend for a while, (something that often happens in the spring of the year ..."sell in May and go away"), you may have to wait longer for an uptrend that will allow you to sell Covered CALLs above your basis..
The trade off on doing SPYs rather than Apple is risk to reward. Apple is more volatile than SPY which means better premiums on options. But Apple is subject to much bigger price swings. For instance It is currently almost 40% off it's 52-week highs from last September. We normally do not see quite as big price moves on the broad market index (SPY), so the downside risk if SPY is PUT to us is not as large.
Thanks for sharing your SPY trade as hearing other's experiences helps all of us learn. That is how we can develop unique strategies that work for us as individuals. Keep us posted on how the trade works for you.
Paul Madison
On Tue, Apr 2, 2013 at 3:24 PM, charles brunell <cbrunelll@yahoo.com> wrote:
Hi ClubbersAt the last meeting, I think it was Malcom, that asked if i would write up one of my SPY trades. So here goes. Yesterday afternoon I STO 5 puts with a 155.50 strike, .72 premium, APR 41%. At the time of the sale the SPY was trading at 155.76.I kind of think that Malcom and I are thinking along the same lines. He's using APPL and I'm using SPY as my instrument. I'm still tinkering with my stragtegy as to how far out the money to be or when to be at the money, trying to incorporate bollingr bands. In other words I really don't know what I'm doing!Any thoughts or comments would be appreciated.
CHUCK B
Paul Madison
Oooh, missed it by thaaaaaat much!
"Keep the line moving", Bruce Bochey, SF Giants Manager.
Malcolm
"Keep the line moving", Bruce Bochey, SF Giants Manager.
Malcolm
On 4/5/2013 1:50 PM, charles brunell
wrote:
If you guys recall on Monday I STO 5 puts with a 155.50 strike, .72 premium. Today the SPY closed at 155.19. So it will be put to me this weekend, and I will be looking to sell some calls next week.CHUCK B
From: Paul Madison <TheCOOLClubDude@gmail.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Wednesday, April 3, 2013 12:35 PM
Subject: Re: [cool_club] SPY
Hi Chuck,
If you are making money, then it is working for you.
The only reason I encourage selling Cash-Secured PUTs when the price has moved down to a lower Bollinger Band is because if the security is PUT to you then your downside exposure may not be quite as significant. The price has already moved from the top of the range to the bottom of the range. That does not mean it will not go down further but it may mean there is more upside potential than downside risk.
If you sell Cash-Secured PUTs above the lower range it just means your basis, if it is PUT to you, will be at a higher level. This may mean that if the security moves into a downtrend for a while, (something that often happens in the spring of the year ..."sell in May and go away"), you may have to wait longer for an uptrend that will allow you to sell Covered CALLs above your basis..
The trade off on doing SPYs rather than Apple is risk to reward. Apple is more volatile than SPY which means better premiums on options. But Apple is subject to much bigger price swings. For instance It is currently almost 40% off it's 52-week highs from last September. We normally do not see quite as big price moves on the broad market index (SPY), so the downside risk if SPY is PUT to us is not as large.
Thanks for sharing your SPY trade as hearing other's experiences helps all of us learn. That is how we can develop unique strategies that work for us as individuals. Keep us posted on how the trade works for you.
Paul Madison
On Tue, Apr 2, 2013 at 3:24 PM, charles brunell <cbrunelll@yahoo.com> wrote:
Hi ClubbersAt the last meeting, I think it was Malcom, that asked if i would write up one of my SPY trades. So here goes. Yesterday afternoon I STO 5 puts with a 155.50 strike, .72 premium, APR 41%. At the time of the sale the SPY was trading at 155.76.I kind of think that Malcom and I are thinking along the same lines. He's using APPL and I'm using SPY as my instrument. I'm still tinkering with my stragtegy as to how far out the money to be or when to be at the money, trying to incorporate bollingr bands. In other words I really don't know what I'm doing!Any thoughts or comments would be appreciated.
CHUCK B
--
Paul Madison
Paul
I'm looking at the charts for the SPY this morning,before the markets open, and the bollinger bands for the daily and weekly are opposite of each other. The daily is touching the bottom band and the weekly is near the top. How so you interpret that? I'm thinking when you are selling weekly options that you pay more attention the daily chart.
CHUCK B
From: charles brunell <cbrunelll@yahoo.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Friday, April 5, 2013 4:50 PM
Subject: Re: [cool_club] SPY
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Friday, April 5, 2013 4:50 PM
Subject: Re: [cool_club] SPY
If you guys recall on Monday I STO 5 puts with a
155.50 strike, .72 premium. Today the SPY closed at 155.19. So it will be put to me this weekend, and I will be looking to sell some calls next week.
CHUCK B
From: Paul Madison <TheCOOLClubDude@gmail.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Wednesday, April 3, 2013 12:35 PM
Subject: Re: [cool_club] SPY
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Wednesday, April 3, 2013 12:35 PM
Subject: Re: [cool_club] SPY
Hi Chuck,
If you are making money, then it is working for you.
The only reason I encourage selling Cash-Secured PUTs when the price has moved down to a lower Bollinger Band is because if the security is PUT to you then your downside exposure may not be quite as significant. The price has already moved from the top of the range to the bottom of the range. That does not mean it will not go down further but it may mean there is more upside potential than downside risk.
If you sell Cash-Secured PUTs above the lower range it just means your basis, if it is PUT to you, will be at a higher level. This may mean that if the security moves into a downtrend for a while, (something that often happens in the spring of the year ..."sell in May and go away"), you may have to wait longer for an uptrend that will allow you to sell Covered CALLs above your basis..
The trade off on doing SPYs rather than Apple is risk to reward. Apple is more volatile than SPY which means better premiums on options. But Apple is subject to much bigger price swings. For instance It is currently almost 40% off it's 52-week highs from last September. We normally do not see quite as big price moves on the broad market index (SPY), so the downside risk if SPY is PUT to us is not as large.
Thanks for sharing your SPY trade as hearing other's experiences helps all of us learn. That is how we can develop unique strategies that work for us as individuals. Keep us posted on how the trade works for you.
Paul Madison
On Tue, Apr 2, 2013 at 3:24 PM, charles brunell <cbrunelll@yahoo.com> wrote:
Hi ClubbersAt the last meeting, I think it was Malcom, that asked if i would write up one of my SPY trades. So here goes. Yesterday afternoon I STO 5 puts with a 155.50 strike, .72 premium, APR 41%. At the time of the sale the SPY was trading at 155.76.I kind of think that Malcom and I are thinking along the same lines. He's using APPL and I'm using SPY as my instrument. I'm still tinkering with my stragtegy as to how far out the money to be or when to be at the money, trying to incorporate bollingr bands. In other words I really don't know what I'm doing!Any thoughts or comments would be appreciated.
CHUCK B
Paul Madison
Hi Chuck,
Yes, in general I would say daily bands are more important when doing weekly options. However the daily band has been narrowing for a couple of weeks meaning the trading range has been very tight and not very volatile. This pattern is often interpreted as a sign that we are about to see a "breakout" in one direction or the other.
If that breakout is down, then it is not bad to be thinking about the longer term trading range which we can see by looking at the weekly bands. I might want to see which direction we are heading before committing. If we are going down I would want to sell PUTs below the daily range and might want to see strikes closer to the weekly range. This might require a bit of patience.
Hope this helps,
Paul Madison
On Mon, Apr 8, 2013 at 7:23 AM, charles brunell <cbrunelll@yahoo.com> wrote:
PaulI'm looking at the charts for the SPY this morning,before the markets open, and the bollinger bands for the daily and weekly are opposite of each other. The daily is touching the bottom band and the weekly is near the top. How so you interpret that? I'm thinking when you are selling weekly options that you pay more attention the daily chart.CHUCK BFrom: charles brunell <cbrunelll@yahoo.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Friday, April 5, 2013 4:50 PM
Subject: Re: [cool_club] SPY
If you guys recall on Monday I STO 5 puts with a 155.50 strike, .72 premium. Today the SPY closed at 155.19. So it will be put to me this weekend, and I will be looking to sell some calls next week.CHUCK BFrom: Paul Madison <TheCOOLClubDude@gmail.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Wednesday, April 3, 2013 12:35 PM
Subject: Re: [cool_club] SPY
Hi Chuck,If you are making money, then it is working for you.The only reason I encourage selling Cash-Secured PUTs when the price has moved down to a lower Bollinger Band is because if the security is PUT to you then your downside exposure may not be quite as significant. The price has already moved from the top of the range to the bottom of the range. That does not mean it will not go down further but it may mean there is more upside potential than downside risk.If you sell Cash-Secured PUTs above the lower range it just means your basis, if it is PUT to you, will be at a higher level. This may mean that if the security moves into a downtrend for a while, (something that often happens in the spring of the year ..."sell in May and go away"), you may have to wait longer for an uptrend that will allow you to sell Covered CALLs above your basis..The trade off on doing SPYs rather than Apple is risk to reward. Apple is more volatile than SPY which means better premiums on options. But Apple is subject to much bigger price swings. For instance It is currently almost 40% off it's 52-week highs from last September. We normally do not see quite as big price moves on the broad market index (SPY), so the downside risk if SPY is PUT to us is not as large.Thanks for sharing your SPY trade as hearing other's experiences helps all of us learn. That is how we can develop unique strategies that work for us as individuals. Keep us posted on how the trade works for you.Paul MadisonOn Tue, Apr 2, 2013 at 3:24 PM, charles brunell <cbrunelll@yahoo.com> wrote:
Hi ClubbersAt the last meeting, I think it was Malcom, that asked if i would write up one of my SPY trades. So here goes. Yesterday afternoon I STO 5 puts with a 155.50 strike, .72 premium, APR 41%. At the time of the sale the SPY was trading at 155.76.I kind of think that Malcom and I are thinking along the same lines. He's using APPL and I'm using SPY as my instrument. I'm still tinkering with my stragtegy as to how far out the money to be or when to be at the money, trying to incorporate bollingr bands. In other words I really don't know what I'm doing!Any thoughts or comments would be appreciated.
CHUCK B--Paul Madison
We are coming off of two weeks of lower involvement in the Market - Spring Break vacations. Which gives the charts a narrowing and the set up for a break out when the volume returns. And this is the first week of Q1 earnings reports, so volatility will increase.
Coin flip.
Malcolm
Sent from my Communicator
Hi Chuck,Yes, in general I would say daily bands are more important when doing weekly options. However the daily band has been narrowing for a couple of weeks meaning the trading range has been very tight and not very volatile. This pattern is often interpreted as a sign that we are about to see a "breakout" in one direction or the other.
If that breakout is down, then it is not bad to be thinking about the longer term trading range which we can see by looking at the weekly bands. I might want to see which direction we are heading before committing. If we are going down I would want to sell PUTs below the daily range and might want to see strikes closer to the weekly range. This might require a bit of patience.Hope this helps,Paul MadisonOn Mon, Apr 8, 2013 at 7:23 AM, charles brunell <cbrunelll@yahoo.com> wrote:
PaulI'm looking at the charts for the SPY this morning,before the markets open, and the bollinger bands for the daily and weekly are opposite of each other. The daily is touching the bottom band and the weekly is near the top. How so you interpret that? I'm thinking when you are selling weekly options that you pay more attention the daily chart.CHUCK BFrom: charles brunell <cbrunelll@yahoo.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Friday, April 5, 2013 4:50 PM
Subject: Re: [cool_club] SPY
If you guys recall on Monday I STO 5 puts with a 155.50 strike, .72 premium. Today the SPY closed at 155.19. So it will be put to me this weekend, and I will be looking to sell some calls next week.CHUCK BFrom: Paul Madison <TheCOOLClubDude@gmail.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Wednesday, April 3, 2013 12:35 PM
Subject: Re: [cool_club] SPY
Hi Chuck,If you are making money, then it is working for you.The only reason I encourage selling Cash-Secured PUTs when the price has moved down to a lower Bollinger Band is because if the security is PUT to you then your downside exposure may not be quite as significant. The price has already moved from the top of the range to the bottom of the range. That does not mean it will not go down further but it may mean there is more upside potential than downside risk.If you sell Cash-Secured PUTs above the lower range it just means your basis, if it is PUT to you, will be at a higher level. This may mean that if the security moves into a downtrend for a while, (something that often happens in the spring of the year ..."sell in May and go away"), you may have to wait longer for an uptrend that will allow you to sell Covered CALLs above your basis..The trade off on doing SPYs rather than Apple is risk to reward. Apple is more volatile than SPY which means better premiums on options. But Apple is subject to much bigger price swings. For instance It is currently almost 40% off it's 52-week highs from last September. We normally do not see quite as big price moves on the broad market index (SPY), so the downside risk if SPY is PUT to us is not as large.Thanks for sharing your SPY trade as hearing other's experiences helps all of us learn. That is how we can develop unique strategies that work for us as individuals. Keep us posted on how the trade works for you.Paul MadisonOn Tue, Apr 2, 2013 at 3:24 PM, charles brunell <cbrunelll@yahoo.com> wrote:
Hi ClubbersAt the last meeting, I think it was Malcom, that asked if i would write up one of my SPY trades. So here goes. Yesterday afternoon I STO 5 puts with a 155.50 strike, .72 premium, APR 41%. At the time of the sale the SPY was trading at 155.76.I kind of think that Malcom and I are thinking along the same lines. He's using APPL and I'm using SPY as my instrument. I'm still tinkering with my stragtegy as to how far out the money to be or when to be at the money, trying to incorporate bollingr bands. In other words I really don't know what I'm doing!Any thoughts or comments would be appreciated.
CHUCK B--Paul Madison
--
Thanks guys for the response.
CHUCK B
From: MMC <malcolm@mmyles.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Monday, April 8, 2013 11:05 AM
Subject: Re: [cool_club] SPY
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Monday, April 8, 2013 11:05 AM
Subject: Re: [cool_club] SPY
We are coming off of two weeks of lower involvement in the Market - Spring Break vacations. Which gives the charts a narrowing and the set up for a break out when the volume returns. And this is the first week of Q1 earnings reports, so volatility will increase.
Coin flip.
Malcolm
Sent from my Communicator
Hi Chuck,Yes, in general I would say daily bands are more important when doing weekly options. However the daily band has been narrowing for a couple of weeks meaning the trading range has been very tight and not very volatile. This pattern is often interpreted as a sign that we are about to see a "breakout" in one direction or the other.
If that breakout is down, then it is not bad to be thinking about the longer term trading range which we can see by looking at the weekly bands. I might want to see which direction we are heading before committing. If we are going down I would want to sell PUTs below the daily range and might want to see strikes closer to the weekly range. This might require a bit of patience.Hope this helps,Paul MadisonOn Mon, Apr 8, 2013 at 7:23 AM, charles brunell <cbrunelll@yahoo.com> wrote:
PaulI'm looking at the charts for the SPY this morning,before the markets open, and the bollinger bands for the daily and weekly are opposite of each other. The daily is touching the bottom band and the weekly is near the top. How so you interpret that? I'm thinking when you are selling weekly options that you pay more attention the daily chart.CHUCK BFrom: charles brunell <cbrunelll@yahoo.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Friday, April 5, 2013 4:50 PM
Subject: Re: [cool_club] SPY
If you guys recall on Monday I STO 5 puts with a 155.50 strike, .72 premium. Today the SPY closed at 155.19. So it will be put to me this weekend, and I will be looking to sell some calls next week.CHUCK BFrom: Paul Madison <TheCOOLClubDude@gmail.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Wednesday, April 3, 2013 12:35 PM
Subject: Re: [cool_club] SPY
Hi Chuck,If you are making money, then it is working for you.The only reason I encourage selling Cash-Secured PUTs when the price has moved down to a lower Bollinger Band is because if the security is PUT to you then your downside exposure may not be quite as significant. The price has already moved from the top of the range to the bottom of the range. That does not mean it will not go down further but it may mean there is more upside potential than downside risk.If you sell Cash-Secured PUTs above the lower range it just means your basis, if it is PUT to you, will be at a higher level. This may mean that if the security moves into a downtrend for a while, (something that often happens in the spring of the year ..."sell in May and go away"), you may have to wait longer for an uptrend that will allow you to sell Covered CALLs above your basis..The trade off on doing SPYs rather than Apple is risk to reward. Apple is more volatile than SPY which means better premiums on options. But Apple is subject to much bigger price swings. For instance It is currently almost 40% off it's 52-week highs from last September. We normally do not see quite as big price moves on the broad market index (SPY), so the downside risk if SPY is PUT to us is not as large.Thanks for sharing your SPY trade as hearing other's experiences helps all of us learn. That is how we can develop unique strategies that work for us as individuals. Keep us posted on how the trade works for you.Paul MadisonOn Tue, Apr 2, 2013 at 3:24 PM, charles brunell <cbrunelll@yahoo.com> wrote:
Hi ClubbersAt the last meeting, I think it was Malcom, that asked if i would write up one of my SPY trades. So here goes. Yesterday afternoon I STO 5 puts with a 155.50 strike, .72 premium, APR 41%. At the time of the sale the SPY was trading at 155.76.I kind of think that Malcom and I are thinking along the same lines. He's using APPL and I'm using SPY as my instrument. I'm still tinkering with my stragtegy as to how far out the money to be or when to be at the money, trying to incorporate bollingr bands. In other words I really don't know what I'm doing!Any thoughts or comments would be appreciated.
CHUCK B--Paul Madison
--
Hi Chuck,
You might want to check the Calculation settings. It could be that they are on manual rather than automatic. If you go to the Formula Ribbon you will see an icon for Calculation Options. Click on that and chose Automatic and it should fix the problem.
When I can I will go back and make sure that the version on the website is saved with "Automatic" for Calculation Options.
Thanks,
Paul Madison
On Mon, Apr 8, 2013 at 1:16 PM, charles brunell <cbrunelll@yahoo.com> wrote:
Thanks guys for the response.CHUCK BFrom: MMC <malcolm@mmyles.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Monday, April 8, 2013 11:05 AM
Subject: Re: [cool_club] SPY
We are coming off of two weeks of lower involvement in the Market - Spring Break vacations. Which gives the charts a narrowing and the set up for a break out when the volume returns. And this is the first week of Q1 earnings reports, so volatility will increase.Coin flip.
MalcolmSent from my CommunicatorHi Chuck,Yes, in general I would say daily bands are more important when doing weekly options. However the daily band has been narrowing for a couple of weeks meaning the trading range has been very tight and not very volatile. This pattern is often interpreted as a sign that we are about to see a "breakout" in one direction or the other.
If that breakout is down, then it is not bad to be thinking about the longer term trading range which we can see by looking at the weekly bands. I might want to see which direction we are heading before committing. If we are going down I would want to sell PUTs below the daily range and might want to see strikes closer to the weekly range. This might require a bit of patience.Hope this helps,Paul MadisonOn Mon, Apr 8, 2013 at 7:23 AM, charles brunell <cbrunelll@yahoo.com> wrote:
PaulI'm looking at the charts for the SPY this morning,before the markets open, and the bollinger bands for the daily and weekly are opposite of each other. The daily is touching the bottom band and the weekly is near the top. How so you interpret that? I'm thinking when you are selling weekly options that you pay more attention the daily chart.CHUCK BFrom: charles brunell <cbrunelll@yahoo.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Friday, April 5, 2013 4:50 PM
Subject: Re: [cool_club] SPY
If you guys recall on Monday I STO 5 puts with a 155.50 strike, .72 premium. Today the SPY closed at 155.19. So it will be put to me this weekend, and I will be looking to sell some calls next week.CHUCK BFrom: Paul Madison <TheCOOLClubDude@gmail.com>
To: "cool_club@bivio.com" <cool_club@bivio.com>
Sent: Wednesday, April 3, 2013 12:35 PM
Subject: Re: [cool_club] SPY
Hi Chuck,If you are making money, then it is working for you.The only reason I encourage selling Cash-Secured PUTs when the price has moved down to a lower Bollinger Band is because if the security is PUT to you then your downside exposure may not be quite as significant. The price has already moved from the top of the range to the bottom of the range. That does not mean it will not go down further but it may mean there is more upside potential than downside risk.If you sell Cash-Secured PUTs above the lower range it just means your basis, if it is PUT to you, will be at a higher level. This may mean that if the security moves into a downtrend for a while, (something that often happens in the spring of the year ..."sell in May and go away"), you may have to wait longer for an uptrend that will allow you to sell Covered CALLs above your basis..The trade off on doing SPYs rather than Apple is risk to reward. Apple is more volatile than SPY which means better premiums on options. But Apple is subject to much bigger price swings. For instance It is currently almost 40% off it's 52-week highs from last September. We normally do not see quite as big price moves on the broad market index (SPY), so the downside risk if SPY is PUT to us is not as large.Thanks for sharing your SPY trade as hearing other's experiences helps all of us learn. That is how we can develop unique strategies that work for us as individuals. Keep us posted on how the trade works for you.Paul MadisonOn Tue, Apr 2, 2013 at 3:24 PM, charles brunell <cbrunelll@yahoo.com> wrote:
Hi ClubbersAt the last meeting, I think it was Malcom, that asked if i would write up one of my SPY trades. So here goes. Yesterday afternoon I STO 5 puts with a 155.50 strike, .72 premium, APR 41%. At the time of the sale the SPY was trading at 155.76.I kind of think that Malcom and I are thinking along the same lines. He's using APPL and I'm using SPY as my instrument. I'm still tinkering with my stragtegy as to how far out the money to be or when to be at the money, trying to incorporate bollingr bands. In other words I really don't know what I'm doing!Any thoughts or comments would be appreciated.
CHUCK B--Paul Madison
--