OptionPundit

Tag: OPNewsletter

  • OPNewsletter- Mar’09 +8.8%, Apr +2.4% (Open)

    March’09 portfolios were closed +8.8% (excluding commissions) and +5.6% (including commissions). I used up about +46.7% of the assumed 10K capital for OPNewsletter. This result doesn’t include excellent results from bonus trade alerts.

    market-movement-mar09-opn-portfolio When compared with broader markets, this was probably one of the best months for OPNewsletter. Look at the major market movements since we opened the Mar (Mid Feb’09) portfolio. RUT traveled almost -20% south; and DOW, S&P500 and Nasdaq ranging from -14% to -16%. All this was followed by sharp snap back rallies. Isn’t this amazing, almost 20% back and forth move in one month. I have not researched to find if this is one of its kinds or has happened before. But whatever be case, this is not income trader’s best friend. This was surely not an easy period. In fact one of the toughest and most volatile periods, at least of my lifetime (leaving aside Oct 1987 crash). Hence preserving capital and delivering just positive results itself is good enough. One of the strategy I used was to focus only what was opened and keep cash free to make adjustments as needed. This served nicely without really triggering panic due to shortage of capital. For Option Trading Strategies, We used multiple strategies i.e. Calendars, Credit Spreads, Digonal Spreads and so on. I however, decided not to open an Iron Condor this month anticipating extreme movements which also served nicely (There is not a single losing Iron Condor since re-opening of OPNewsletter).

    For OPNewsletter, The best performing portfolio was USO which delivered +22.8% and it was also rolled over to Apr. I expect this portfolio to deliver +50% by July. The worst portfolio was ABT which was almost break-even (+0.89%). MCD delivered +5.5%. A tough month though, it required greek’s analysis, technical analysis, gut feel and past experiences with similar situation (VISA, May 2008) helped sail through this month.

    Some of the excellent intraday trades, results not included in OPN tracking, were +42% on SRS, +58% on VIX, CF arbitrage of $6, DECK for +220%, AZO (+27%, +39%, +73%), SKF +20% to +50%, FDS lost to break-even, NKE earnings +22%, DELL earnings amongst others. As mentioned, These results are not part of OPN tracking.

    We are nicely positioned for Apr’09 portfolios as well and so far invested only +19.7% of assumed 10K capital. I shall be opening a few more portfolios next week, if you would like to join, pls sign-up for the OPN waitlist.

    Those who could trade intra-day, markets offered wonderful trading opportunities, specially on the Expiration day. A smiling butterfly was shared with all the free members as well, that resulted into >+100% gains. Hope folks who followed invescafe/speculative trade alerts (some of those listed above), probably had some good opportunities that I played for intraday trades.

    (You may want to sign-up for the Basic Membership (Free until Dec 2009) that I use to share free trade alerts for registered members).

    I have been experimenting with several underlying/strategy combos over past 3-4 months, with real money. I think I am ready for opening new Portfolios/newsletter(s) to take advantage from current environment. I shall share more on this later.

    One final message, markets are not out of woods yet, pls don’t let complacency set-in, these are extraordinary time and it requires one to be taking extraordinary steps.

    Trade Carefully, Trade Profitably, OP

  • Outperformance Continues at OPNewsletter

    When compared with broader markets, Feb was an excellent month for OPNewsletter coupled with a few good learnings (kinda reinforcement, been there done that, but forget that). Overall, OPNewsletter for Feb closed up +5.6% x-commissions and +2.6% including commissions. Capital preservtion and thus allocation was higher priority vs missing an opportunity.

    These results doesn’t include the speculative directional trade which were shared here (only OPN subscribers can see this thread) and here at my profile on InvesCafe (Free) which includes likes of RIMM +40%, V +7.8%, BIDU +5.2%, BAC +10% to +40%, ESI + 33%, SRS, STT, WHR, BTU, AXP, CAT, ISRG, BLK and many more. I opened multiple positions where some won some lost (due to inability to fill on time as I was away and didn’t want to autotrade). Hardly any of those missed the expectations except the VXX which I intentionally closed.

    Above all, this doesn’t include future opportunities via capital preservation due to early warnings. Hope you have been reading OptionPundit and thus were aware of the Bear Market Signal that was reconfirmed recently. And of course, at least one assett class probably would have been shining in your diversified portfolio.

    I have already started investing for March’09 portfolios. if you would to sign-up, pls click here.

    Cheers and profitable trading, OP

  • Panic Before Everyone Else Does

    I have tried my best to warn OP readers of the upcoming storm, over and over again starting from November 2007. Fun fact, this is what I wrote then-

    But hey, if you do get a bearish market, then don’t forget to mention that you were told first hand here at OptionPundit.

    We are close to disastrous situation, Yesterday markets closed almost in the range that I highlighted in Nov 18 post. Net, here we are with a bear market signal. Very close to some extremely strong support areas 7,000-7,400 for a bull market that started from 1930s to 2007. I shall caution to stay away for a while till Mr. market make-up his mind.

    I warned in Mid Sept’08, and OPNewsletter stayed away for Oct’08 portfolios, preserved capital by allocating almost 1/3rd of capital only and been reinvesting since then. Though results are not that spectacular, but nevertheless it is an outperformance in the face of tough Market that we are facing. We have opened 2 portfolios for Mar’09 yesterday and will soon be opening more. If you are interested in joining, pls click to know more about OPNewletter.

    Hope you are on InvesCafe, this is the place I use for short updates for intraday trading opportunity. Just yesterday alone, I shared 3 intraday opportunities (VIX, HPQ and AAPL) all three registering good gains. It’s a great tool and I have been using it for while. Check this out for how many profitable alerts I shared over past few days. I shall encourage you to sign-up and start using it, it’s wonderful tool. All my InvesCafe updated are posted to Twitter automatically as well.

    Today is US Equity option expiration day, and also CPI data will be released at 8:30 US EST. Expect the volatility exacerbated by already <7,500 level. Stock pinning, cheap options and lot more to trade, but trade carefully.

    Profitable Trading, OP

  • Outperformance : OPNewsletter Feb’09 +5.85%(Open)

    An excellent month for OPNewsletter so far. Overall, OPNewsletter is up +8.87% x-commissions and +5.85% including commissions. We didn’t have to make any major adjustments to our portfolios except one which rolled partially to next month. We closed one portfolio for +17.17% gains and except any major disastrous events on Tuesday market open, remainder portfolios stands to gain good theta decay over the long weekend. This is what OPN wants, portfolios to be as boring as possible. We didn’t get fills on two income portfolios else results would have been even stronger.

    These results doesn’t include the speculative directional trade which were shared here (only OPN subscribers can see this thread) and here at my profile on InvesCafe (Free) which includes likes of RIMM +40%, V +7.8%, BIDU +5.2%, BAC +10% to +40%, ESI + 33%, SRS, STT, WHR, BTU, AXP, CAT, ISRG, BLK and many more. I opened multiple positions where some won some lost (due to inability to fill ontime as I was away and didn’t want to autotrade). Hardly any of those missed the expectations except the VXX which I intentionally closed.

    Other highlights includes my warning on Friday when markets were going higher in anticipation of stimulus package which proved right. Not that I have crystal ball, but it’s an experience I have been observing in the events of past few years.

    Overall an excellent month except that we didn’t invest a lot of capital for income spreads (only a max of 26.5%), but as I mentioned earlier, capital preservation is higher importance than missing a potential opportunity, especially in markets like current ones. We may always make more money if we have trading capital preserved. Once trading capital is lost, we can’t benefit from any opportunity even if it is as sure as that sunrise.

    I shall be looking for March’09 portfolios. if you would to sign-up, pls click here.

    Cheers and profitable trading, OP

  • OPNewsletter (Jan’09) +8.17% x-commissions

    This was another positive month for the OPNewsletter Income portfolio. On the invested capital, OPN delivered a total +8.17% excluding brokerage commissions and +5.39% including commissions.

    As part of on-going pre-caution, OPN’s Jan portfolio consisted of 3 income portfolios and all 3 were positive. Highlight of the results was Iron Condor Income portfolio that delivered +14.2% gains and was another successive winning streak. In spite of extreme unfavorable conditions in 2008, not even a single OPN RUT Iron Condor lost money last year.

    I am about to open the Feb’09 income portfolios, should you be interested in joining, pls find what is OPNewsletter here.

    Profitable Trading, OP

  • OPNewsletter Portfolio up +37.5% in 2008

    Year 2008 was almost equally as good a year for OPNewsletter as 2007 especially when compared with any major benchmark index like S&P 500. In 11 months completion, from Feb’08 till Dec’08, OPNewsletter outperformed S&P500 by a wide app 70% margin.

    OPNewsletter Performance 2008

    During the year when the DJIA decline 33.84%, while the S&P 500 trimmed 38.49%, the NASDAQ lost 40.54% and Russell 2000 lost over 35%, OPNewsletter went up by +48.2% excluding brokerage commissions and +37.5% including retail brokerage commissions (my commissions are even lower than commissions I am assuming in the calculations). If however, I calculate the way usually option trading newsletter calculates (returns/amount invested), then OPN returns are +144% but we know, we don’t invest money that way. What really matters is the gain on overall capital.

    These results does NOT even include returns from bonus trades (earning play, momentum plays, almost risk free trades, swing trades, intra-day plays, etc.) where the success hit rate was over 80% (I didn’t spend time in counting too many bonus trades for past 11months, it is based on just the snapshot on the forum alone) and gains far outperforming losses.

    Here is a snapshot of the returns, portfolio capital invested and thus effective returns and compounding effect of OPNewsletter results.

    Except for the month of Aug’08, OPNewsletter has been positive every month. If you notice, very little capital was invested in the month of Oct’08 (expiration) and that was the month that most traders and investors alike want to forget. I warned OPNewsletter subscribers about the upcoming severity of the bears and we were on sidelines watching the show. We have been investing cautiously since then and only increased capital now for Jan’09 portfolios, that too only 30% so far. The maximum portfolio capital used was 84.3% for the May’08 expiration round.

    During this period, we opened several type of income spread including Iron Condors, Diagonal spread, Double diagonals, calendars, double calendars, credit spread, debit spreads, covered calls, Straight calls and puts and even purchased stocks where buying options was not making good sense.

    There are a lot of learnings that together with subscribers we have learned in the past year and things improves, we should be able to capitalize on those.

    Pls click here to read what do OPN subscriber think and browse OPNewsletter should you choose to join the OPN community.

    Going ahead looking for 3rd consecutive year of out-performance.

    Profitable Trading, OP