An update to my Money Flow Buy Strategy is long overdue. Following the multi-week pull back in equities that we recently experienced, my strategy of selling puts as a stock acquisition strategy is hanging in there! I let several short puts expire into April expiration, as we awaited the results of the first round of the French election. Seemed like a good opportunity to take some risk off the table and capture some gains. Although, rolling puts into what was an elevated VIX environment would have yielded slightly higher option premium. With anything.. there's a trade-off.
In addition to closing several positions, via short options expiring worthless, I was also assigned on 4 of my 12 short premium plays. Here's a break down YTD.
In addition to closing several positions, via short options expiring worthless, I was also assigned on 4 of my 12 short premium plays. Here's a break down YTD.
As you see, several positions expired worthless. Positions in FB, SWKS, MU, CELG, GLW, RCL, CB and ANTM all expired OTM. In total I collected $2,513.00 in premium in these trades, with FB leading the way.
I was assigned on TXT, FLR, GS and JPM. the rally over the first few days of this week helped a lot in those names. I'm now holding long shares, having been exercised on the short option(s) This is where you can see the benefits of selling premium on Money Flow d Buy Signals as an acquisition strategy. Example, my cost basis on JPM is 85.68 after the recent retreat in price I'm still in the black thanks to the 4.32 I collected in premium before the stock was put to me. While I'm underwater in GS, I'm less so, thanks to the 9.38 that my cost basis was reduced by selling premium prior to the stock being put to me. Matter of fact, had I purchased the stock at the close the same day I sold the premium (2/6) I would have paid 239.98, I initiated a trade the very same day, but instead sold premium and reduced my basis. i'm now long GS at 235.62. Yup, still under water, but less water. I will now sell calls against my long shares to off-set basis even further. Your'e basic covered call strategy.
If you've been watching our daily video's, you know that our market stance has turned cautiously bullish as the power bars have once again turned positive and price is above both MA's. On that, I'm looking to re-load on any Money Flow Buy that meets my rules for this strategy.
You can review my plan and follow results HERE
Happy Trading!
AA
I was assigned on TXT, FLR, GS and JPM. the rally over the first few days of this week helped a lot in those names. I'm now holding long shares, having been exercised on the short option(s) This is where you can see the benefits of selling premium on Money Flow d Buy Signals as an acquisition strategy. Example, my cost basis on JPM is 85.68 after the recent retreat in price I'm still in the black thanks to the 4.32 I collected in premium before the stock was put to me. While I'm underwater in GS, I'm less so, thanks to the 9.38 that my cost basis was reduced by selling premium prior to the stock being put to me. Matter of fact, had I purchased the stock at the close the same day I sold the premium (2/6) I would have paid 239.98, I initiated a trade the very same day, but instead sold premium and reduced my basis. i'm now long GS at 235.62. Yup, still under water, but less water. I will now sell calls against my long shares to off-set basis even further. Your'e basic covered call strategy.
If you've been watching our daily video's, you know that our market stance has turned cautiously bullish as the power bars have once again turned positive and price is above both MA's. On that, I'm looking to re-load on any Money Flow Buy that meets my rules for this strategy.
You can review my plan and follow results HERE
Happy Trading!
AA
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