Week in Review – July 14 – 18, 2014


Option to Profit Week in Review
July 14 – 18,  2014
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Weekly Up to Date Performance

July 14 – 18, 2014

New purchases for the week beat the unadjusted S&P 500 by 0.5% and surpassed the adjusted index by 0.9%

The market was everywhere this past week, going nowhere, going lower and going higher. While doing that it did confirm its resilience, but really gave no clue of its further character.

The resilience tells me about being true to its past. I want to know about the future.

After a horrid day on Thursday, as a result of competing terrible international stories, the market made a very credible comeback, despite the fact that it is again faced with a weekend of uncertainty, when wiser men of ages past would have lightened their holdings.

New positions, again only a handful of them this week,  performed in a mediocre fashion until some recovery today. They managed to climb&nb
sp;1.1% higher while the overall market was  able to rescue itself from a weekly loss with today’s showing. The overall market ended 0.6% higher on an unadjusted basis and 0.2% higher on an adjusted basis.

Existing positions did well and outpaced the market, in part due to the ability and good luck of being able to roll so many positions over this week. They beat the market by 0.2%

With only one assignment this week performance of positions closed in 2014 didn’t change very much, but they continue to out-perform the S&P 500 performance by 1.4%. They were up 3.4% out-performing the market by  67.2%. 

Coming off of last week this one was looking as if it would be one of significant disappointment.

Last week had something for everyone and without the need to spend too much cash in getting there. The volume of rollovers and new call position trades more than made up for the lack of new positions being opened.

As they say when you bring your cash to the bank door deposit, no one really cares about the white powder on the bills.

That’s how I feel about the weekly income stream. I don’t really care how its generated, but if I could fantasize, it would be generated without the need to open new positions. I would love to just trade the same stocks over and over again and sometimes you can do just that, but it takes a market that isn’t going straight up.

This week there was very little trading to be done and very little to find positive in the way the market reacted during its trading. More than the mood was the reality that without trades there is no accumulation of income and securing of value from positions, which essentially are otherwise worthless unless sold at a profit or delivering dividends.

The expected reaction to the unexpected double helping of bad news on Thursday didn’t do anything to help put positions into good standing for rollovers or assignments. So it was really looking like a week with little to show for the passage of time, which we know as option sellers, has definite value.

But just as unexpected was the fall on Thursday, so too was the rise on Friday.

If you’re not a believer in serendipity, that’s alright, but the sequence of events worked out nicely, as long as you don’t think about the human tragedies.

After the unexpected happened on Thursday, I had very little expectation of being able to accomplish much with existing positions and was fully expecting a week with lots of expired and unassigned positions.

While I would have liked more assignments by the time the final closing bell rang on Friday, and if only I had a little faith that the rally would be sustained I would have allowed more assignments, somehow it  still all worked out.

So when it’s all said and done that leaves a fair number of positions set to expire next week and some available cash for some new purchases. There are worse problems to have, I suppose.

With the August 2014 cycle set to begin and already having so many expirations next week, there may be reason to consider expanded weekly options for any new positions, where they are available.

In an ideal world next week would be similar to the past one and this week.

It would be great to again get a nice number of rollovers, maybe even sell some new cover on uncovered positions and see some assignments, as well.

If the market stays steady or moves just mildly higher, that could be a good possibility.

If, however, it moves much lower, there may finally be a reason to consider going on a little bit of a spending spree, as its been a long time since we’ve done that sort of thing.

Still, I’d rather keep my money safe, as long as I could still find a way to generate some income to justify all of this.

Serendipity helps.





This week’s details may be seen in the Weekly Performance spreadsheet * or in the PDF file, as well as as in the summary.below

(Note: Duplicate mention of positions reflects different priced lots):

New Positions Opened:   FAST, GPS, LO

Puts Closed in order to take profits:  none

Calls Rolled over, taking profits, into the next weekly cycleHFC, LO, RIG, RIG

Calls Rolled over, taking profits, into extended weekly cycle:  BMY (8/1), C (8/1), CHK (8/1), CHK (8/8), WFM (8/8)

Calls Rolled over, taking profits, into the monthly cycle:  none

Calls Rolled Over, taking profits, into a future monthly cycle: FAST, LB

Calls Rolled Up, taking net profits into same cyclenone

New STO:  DOW (7/25), HFC (7/25), HFC (7/25)

Put contracts expired: none

Put contract rolled over: none

Long term call contracts sold:  none

Calls Assigned:  BMY

Calls Expired:   none

Puts Assigned:  none

Stock positions Closed to take profits:  none

Stock positions Closed to take losses: none

Calls Closed to Take Profits: none

Ex-dividend PositionsCHK (7/14 $0.09)

Ex-dividend Positions Next Week:  FAST (7/23 $0.25)



For the coming week the existing positions have lots that still require the sale of contracts:   AGQ, BMY, C, CLF, COH, FCX, JCP, LULU, MCP, MOS,  NEM, PBR , RIG, TGT, WFM, WLT (See “Weekly Performance” spreadsheet or PDF file)

* If you don’t have a program to read or modify spreadsheets, you can download the OpenOffice Suite at no cost.