|NEW POSITIONS/STO||NEW STO||ROLLOVERS||CALLS ASSIGNED/PUTS EXPIRED||CALLS EXPIRED/PUTS ASSIGNED||CLOSED|
|4/ 4||1||5||9 / 0||1 / 0||2|
Weekly Up to Date Performance
For the first full week of 2014, new purchases trailed the time adjusted S&P 500 by 0.3% and also trailed the unadjusted index by 0.2%.
The market showed an adjusted gain for the week of 0.7% and unadjusted gain of 0.6% for the week, while new positions advanced only 0.4%.
For the 12 positions positions closed in 2014, performance exceeded that of the S&P 500 by 1.1%. They were up 2.9% out-performing the market by 62.8% for the data-challenged year to date. I don’t expect that kind of out=-performance to continue, however, with the current low volatility.
I’m not really certain how I felt about this week.
While I suppose that the bottom line should be the bottom line and that was improved, it still felt very empty.
Prior to today’s assignments, I was at my lowest cash level for a while, yet don’t feel as if I have quite that much to show for it. Beside that, there were only four new position purchases for the week and they really didn’t fare too well, even with lots of cushion built into their strike prices.
On the other hand, there were all of those assignments and the ability to replenish cash reserves, as well as the ability to rollover all but one non-assigned position and to be more time diversified when it was all said and done.
But then there was that lost dividend in Verizon that spiked up for no reason at all on the day before ex-dividend.
Of course, the ambivalence is further reflected in the happiness that I wasn’t holding Verizon after it plunged the next day, also for no reason at all.
So, after all of that, there’s this emptiness that even with a week that had an FOMC release and an Employment Situation Report, not much happened.
Ordinarily, those are the best of all weeks and that might explain the emptiness.
On weeks that the market doesn’t do much other than tread water there’s every reason to expect out-performance. Not only out-performance, but also beating the 1% threshold for new purchases.
This week, as has occurred before, you do get to see how when only opening a small number of new positions it’s very easy to greatly out-perform or under-perform,on the basis of a single stand out.
Following this lackluster week, both in the markets and in personal performance, we’re faced with a monthly expiration, with positioned being well positioned for both assignments and rollovers, although anything goes.
Based on the market’s performance through the first week of yearly trading the idea that “anything goes” is well founded. There basically is very low predictive capability when the first week of an otherwise predicitive month is lower.
However, the market really wasn’t lower. It just felt that way and no one has done any statistical analysis based on the way things feel.
With cash coming and enough positions expiring next week, once again the focus will be on expanded options or February monthly options.
As earnings get underway in earnest next week the market tone may be set by the financials. such as JP Morgan, Citibank, Morgan Stanley and others that all report next week.
If the past two quarters are any guide, the financials will do well, but that won’t necessarily set the stage for the others in the S&P 500. As we’ve seen, retail has been incredibly weak of late and even Macys. which is widely regarded as the best performing right now, has announced large layoffs.
Still, with challenges and risk come opportunity.
I anticipate being a little more active next week, if only to be able to camouflage any under-performers for the week and will be mindful of when companies report earnings. Knowing those dates allows the option of either avoiding, embracing or dancing around those companies.
(Note: Duplicate mention of positions reflects different priced lots):
New Positions Opened: CHK, DRI, EBAY, WLT
Puts Closed in order to take profits: none
Calls Rolled over, taking profits, into the next weekly cycle: none
Calls Rolled over, taking profits, into extended weekly cycle: CSCO, LULU, MRO, MSFT, WLT,
Calls Rolled over, taking profits, into the monthly cycle: none
Calls Rolled Over, taking profits, into a future monthly cycle: none
Calls Rolled Up, taking net profits into same cycle: none
New STO: ANF
Put contracts sold and still open: **
Put contracts expired: none
Put contract rolled over: none
Long term call contracts sold: none
Calls Assigned: ANF, BMY, EMC, HFC, JPM, NLY, SBUX, WAG
Calls Expired: CLF
Puts Assigned: none
Stock positions Closed to take profits: CCL, M
Stock positions Closed to take losses: none
Calls Closed to Take Profits: none
Ex-dividend Positions: EMC (1/6 $0.10), GPS (1/6 $0.20), DRI (1/8 $0.55)
** Some people had early assignment of ANF puts on November 8, 2013. Subsequently OTP Trading Alerts were sent to sell new calls on ANF, as well as to roll over puts. The strike prices on the two trades differ, but the premium differentials have this far been virtually identical through a third round of rollovers, with strike prices adjusted on calls and puts to $36 and $35, respectively, from the original $35.50 put sale.
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