Weekly Update on May’07 Income Trades – Portfolio up 10%
Published on April 27, 2007
Weekly Update on May’07 Income Trades – Portfolio up 10%
Though, I have already achieved my May’s portfolio return objectives even before May has started (my monthly target is 5%-7% returns) there is enough room in these income trades and therefore I can continue to hold. I don’t expect returns like March (> 30%) but there is enough room to make it bigger than 10%.
Here is the 2nd weekly update on my income portfolio that I shared earlier. The original post can be found here and the previous week’s update and adjustments can be found here.
Here is an update on the income trades that I had opened for May expiration cycle. The returns are as of April 27 closing day.
- Trade-1 RUT Iron Condor (750/760/860/870), Current profit = $92/$795, +11.54%
- Trade-2 Dow Double Diagonal (closed put diagonal, left with call diagonal 50/55), Current profit =$22/$485, +4.5%
- Trade-3 SPY Iron Condor (1:1 risk reward), closed with loss =$43/$108, -39.8%
- Trade-3 OIH Double Calendar (150/155), and adjustment 160, Current profit =$207/$1585, +13.0%
Overall gains/loss : $92+$22-$43+$207=$278
Total Investment/Margin = $795+$485-$108 (freed after closing SPY IC)+$1585=$2757/ Portfolio spread
ROM : $278/$2757 i.e. 10% on overall portfolio
The above results are excluding speculative intradays trades like ESRX, WFR, etc. Even though gains are substantial, I don’t include those as that is not my key strategy and involves a very small part of my overall portfolio. Majority of my money is invested in income trades and almost in the same ratio as mentioned above.
Profitable trading, OptionPundit
Couple of updates to these trades:
Trade-1 (RUT Iron condor). I closed my BPS leg of the IC by bying it back for $0.20/spread. Than reduced my overall credit on this IC from 2.05 to 1.85. Now I am left with only May 860/870 call. Rut is currently at 814.57. 93% of chances that this leg will expire worthless.
Trade-4 OIH Portfolio : This really tested the mettle yesterday. Firstly it moved to as high as $161.50 trigering my adjustment point of $161. I bot May/Jun 165 call calendar for $2.30 as I needed posisitve delta to ride on the uptrend. I also rolled-up May 150 put to June for $1.30 credit.
HOWEVER, soonafter lunch OIH started to fall, and fall rapidly. As soon as it was below $158 that triggered another adjustment, I sold May/June $165 call for $1.90/spread.
These OIH adjustments resulted in net credit = $1.30+$1.90-$2.30=$0.90/spread. So my current investment in OIH now stands at $1585-$90=$1495
Profitable trading, OptionPundit
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