I was out of sorts for a week and didn't have anything on in the market. I got back into it last Friday and as I hadn't done much research and had a pile of cash about, I took another flyer at Apple.
Plan: use an Apple Covered Option to generate a return on cash position with a week or longer contract.
Basis: enough for one position in a retirement account.
TA: really starting to believe that a floor of some sort is setting in around the 430 price range. Yes, it can go lower, but I just can't believe what would cause it to descend into the 300s. Didn't take any notes about charts - I was still out of sorts - just recall that it was an oversold condition.
Ran the spreadsheets, waited until the last hour and placed the trade:
1 Mar 13: STO 1x AAPL 13-03-08 420.00 P @ 3.35 (roughly 10 points below close on Friday)
APR 39%, net $326.04
Monday the market sold off and Apple touched 420. Through the week, however, it has been a pretty steady roller coaster into the 430s. I ran a couple of exit scenarios but just didn't have my stomach in the game, so I let it ride. Expiration Friday - weeklies.
Expired worthless as Apple closed at 431.46.
I considered doing a roll out for next week and could have closed out another $300-500 depending on where I set my strike price, but I think I'll wait for the minis to play some more. So I put on a couple other positions instead and say thank you to my January / February Apple gains of $2,033 in five tickets... [side note, and I'm totally aware of the non correlation, if I had taken a position in Apple, I'd be down $3000 in the same time period, just makes the gains appear that much nicer. I don't value myself based on my brother or my portfolio performance to what ifs, woulda, couldas.]
Looks like I get to buy that new iPad after all and lunch with Mickey and Donald for my birthday too.
Seriously, anyone doing any interesting trades - can't be that Apple and Coach are the only two stocks with option premiums?
ps Some may remember that my first Cool Club inspired option proceeds went to dog rescues - pay it forward. I'm very happy to report that Coco Sierra a French Bulldog that had spinal surgery was adopted by her furever home! She is walking, with a individual style, and hell on chew toys. She's got a good chance at a good rest of her life... Money well spent, IMHO...