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IT'S OFFICIAL! BIGGEST PROFITS OF THE YEAR!

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IT'S OFFICIAL! BIGGEST PROFITS OF THE YEAR!

As we suspected, our large ranges were enough to withstand the tumbling market. All of our three remaining open positions expired worthless. Our profit for the April cycle was $7,270 -- our biggest monthly profit of the year.

We deserve to take a little time to celebrate. Maybe we'll get an extra item on today's pizza -- pepperoni AND sausage. When some people celebrate, they'll go out for a $100 dinner or buy a new sport coat. Me? I'm easy to please. If I get extravagant, maybe I'll even add mushrooms as item number three.

We can't celebrate for too long, because we're faced with a severe down-trending market and looks like it will be taking no prisoners. Our May positions are already at risk. The SPX Iron Condor still has a 42-point cushion, but the CME's cushion is only 16 points and the MID Iron Condor is only 7 points away from our short strike.

The VIX (volatility index) has spiked up to 17.74 -- the highest it has been in a long time. That's good and bad. The good part is that we now have some additional premium in the option prices. The bad is that we may soon be forced to pay those higher prices to close a few of our positions.

The situation is that the market is at a point where we are due for a relief bounce. There have to be some bargain hunters out there. Maybe there are still a few short sellers left who will be covering their short positions. For whatever reasons, within the next day or two we should have some relief. The relief will likely only be temporary, though. If the market is going to establish a bottom, it will go back down and test the point from where the relief bounce began. So we're due for some up and down trading. We don't have a lot of room on the downside, but support levels exist. The question is whether or not they will hold. A few good earnings announcements might help. We'll have to keep a close eye on the situation and be prepared to act if the situation calls for it.

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A BAD DAY (WEEK) AT BLACK ROCK FOR QUICKIE TRADERS
It's interesting how people only pay attention to the portions of my column that they want to hear. This month was a good case in point. I try to warn about how dangerous the Quickie positions can be. I even say that I don't personally play the Quickies. Well, there are many readers who ignored my warnings and got whacked pretty good this month.

All three quickie positions were losers this month. We can try and put it into perspective by saying we've been quite successful in the past with our posted quickies. But that doesn't make these plays any less dangerous.

I hope those who played the Quickies this month controlled their losses and didn't get hurt too badly. I'll continue to post the Quickies, but I'll also continue to warn about the dangers.

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CHICAGO IS MY KIND OF TOWN
Today is the second day of the CPTI Chicago seminar. I've had an incredible turnout -- a full house, and then some. We're going over the strategies, discussing the best entry points and exit points for positions. We're talking about how to establish ranges for our Iron Condors. We're also talking about how to become premium detectives and how to identify, and capture, premium that may not be visible to the naked eye.

Last night we all (20+ people) went together and descended on a poor unsuspecting restaurant near the hotel. Lots of fun, good conversation and laughter. But that's what usually happens when you get a bunch of great people together. It's like this at every seminar. I feel very fortunate to know these people and have them in our CPTI family.

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TRACK ING OF OUR PROFITS
Below is a summary of the April CPTI positions. Through six months in tracking year number three, we're now $20,010 to the positive. We're going to continue to be conservative and to trade smart. The profits will follow.

April Trade Summary
MSH - Iron Condor - Profit: $1,80O
OSX - Calendar Spread - Profit: $1,500
CME - Iron Condor - Profit: $1,200
SPX - Sure Thing Credit Spread - Profit: $1,270
SPX - Iron Condor - Profit: $1,500
TOTAL APRIL RESULTS: Profit: $7,270

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REVIEW OF CPTI APRIL POSITIONS
April CPTI Position #1 -- MSH Iron Condor
With MSH trading at about 471, we sold 15 MSH 510 April calls and bought 15 MSH 520 April calls for a credit of $.75. Then we sold 15 MSH 420 April puts and bought 15 MSH 410 April puts for a credit of $.45. Our total net credit is $1.20 with a potential profit of $1,800. Profit of $1,800.

April CPTI Position #2 - OSX Calendar Spread -- Closed for $1,500 Profit.
We bought 10 OSX September $150 calls @ $8.30 and sold 10 OSX April $150 calls @ $2.35. Our out of pocket cost is about $5.95 ($5,950).

Our price target for the next six weeks is about $150. If we're right, we should make a nice chunk of change. Even if OSX goes nowhere, we will not have risked a great deal. The $2.25 we took in from the short April call will erode away and will help to offset any premium erosion from our long Sept. $150 calls. On Tuesday we closed out this position for a profit of $1,500.

April CPTI Position #3 - CME Iron Condor
It's the Chicago Mercantile Exchange-you know, the exchange where people trade futures on grains, gasoline and pork bellies.

We sold 10 CME April 230 calls and bought 10 CME April 240 calls for a credit of about $.60 ($600). Then we sold 10 CME April 165 puts and bought 10 CME April 155 puts for a credit of about $.60 ($600). Our total net credit and profit potential is about $1.20 ($1,200). Our maximum profit range is 165 to 230. Profit of $1,2000.

April CPTI Position #4 - SPX "Sure Thing" Credit Spread - Closed for $1,270 Profit
We sold 2 SPX April 1215 Calls and bought 2 SPX April 1240 Calls for a credit of about $7.00 ($1,400). This strategy is only for traders who have a very large account and have excess maintenance dollars handy. Our initial maintenance is only $5,000 (25 points x 2 contracts). On Wednesday we closed our position for a profit of $1,270.

April CPTI Position #5 - SPX Iron Condor
We sold 15 SPX April 1125 puts and bought 15 SPX April 1115 puts for a credit of about $.50 ($750). Then we sold 15 SPX April 1250 calls and bought 15 SPX April 1260 calls for a credit of about $.50 ($750). Our total net credit is $1.00 ($1,500). Max profit range: 1125 to 1250. Profit of $1,500.

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MAY CPTI NEW POSITIONS
May CPTI Position #1 - SPX Iron Condor - 1142.61
We sold 15 SPX May 1100 puts and bought 15 SPX May 1090 puts for a credit of $.60. Then we sold 15 SPX May 1235 calls and bought 15 SPX May 1245 calls for a credit of $.75. Our total net credit is $1.35 ($2,025). We have a maximum profit range of 1100 to 1235. The bigger the better!! Maintenance is $15,000.

May CPTI Position #2 - CME Iron Condor - 171.05
We sold 15 CME May 155 puts and bought 15 CME May 145 puts for a credit of $.65. Then we sold 15 CME May 230 calls and bought 15 CME May 240 calls for a credit of $.40. Our total net credit and profit potential is $1.05 ($1,575). Our maximum profit range is 155 to 230. The maintenance is $15,000.

May CPTI Position #3 - MID Iron Condor - 627.38
We haven't used MID in the past, so it should be interesting. Due to the fact that it consists of midcap stocks, it should offer us another degree of diversification.
We sold 12 May MID 620 puts and bought 12 May MID 610 puts for a credit of $.65 ($780). Then we sold 12 May MID 700 calls and bought 12 May MID 710 calls for a credit of about $.45 ($540). Our total net credit and profit potential of $1.10 ($1,320). Maximum profit range of 620 to 700. Maintenance is $12,000.

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ONGOING STRATEGIES
ZERO-PLUS Strategy - March Iron Condor Position - SOX - 395.71
Profit: $1,800.
In my Feb. 8, 2004 column, I outlined a strategy based on an initial investment of $100,000. $74,000 was spent on zero coupon bonds maturing in about seven years at a value of $100,000. The principal $100,000 investment is guaranteed. We're trading the remaining $26,000 to generate a "risk free" return on the original investment.

This year, we're going to use the entire $26,000 of extra cash as maintenance for some Iron Condors. That should enable us to generate substantially more profit on this "no risk" strategy.

March Zero Plus Position: March SPX Iron Condor - Expired worthless-Profit: $1,800. New Cash Position: $26,000 + $1,800 = $27,800.

New April Zero Plus Position: We sold 20 of the SOX April 450 calls and bought 20 of the SOX April 460 calls for a credit of $.55 ($1,100). Then we sold 20 SOX April 380 puts and bought 20 of the SOX April 370 puts for $.30 ($600). Our total net credit was $.85 ($1,700). It's a nice wide range with support on the bottom and resistance on the top.

New Zero Plus Position will be posted soon.

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QQQ ITM Strangle - $34.74
We own 10 January 2007 $42 puts and 10 January 2007 $32 calls at a total cost of $14,600. Only $4,600 is at risk as the other $10,000 of intrinsic value will always be there. We then sold the March $36 puts and $38 calls, taking in a total of $1.10 ($1,100). If all goes well, the QQQQs will close somewhere between $36 and $38. We will then sell the April near term options, etc. etc. The objective is to sell premium every month for the next 22 months. When all is said and done, we should be able to show a very nice profit.

We rolled out our short April options to the May $36 puts and $37 calls and took in another $950. Add that to our previous cash total of $2,100 and we now have generated a total of $3,050.

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NEW SUMMER SEMINAR DATE: JULY 16 & 17 -- PHILADELPHIA, PA

WE'VE HAD 27 OUT OF 28 PROFITABLE MONTHS -- WITH NO END IN SIGHT.

COME LEARN HOW TO ACHIEVE SUCCESS WITHOUT STRESS WITH CPTI WEALTH-BUILDING TECHNIQUES.

The CHICAGO Mike Parnos CPTI seminar is sold out. However, there are still spots left for the May IRVINE, CA seminar, and now, of course for the new PHILADELPHIA, PA seminar. They probably won't last long, so be proactive! That means GOYA. Contact me at mparnos@optioninvestor.com and I'll reserve a spot for you. He who hesitates may be SOL.

The dates and locations are:
April 16/17 - Chicago, IL - SOLD OUT!!!
May 14/15 - Irvine, CA
July 16/17 - Philadelphia, PA

Send me an email at mparnos@optioninvestor.com and I'll forward you all the details. Don't be left out! The spots are filling up fast. It'll be a weekend you'll never forget! SERIOUS OPTION TRADERS ONLY! Directional trader converts welcome!

The Irvine seminar is less than a month away. If you signed up, I'll see you there. If you didn't sign up, you probably should.

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HAPPY TRADING!
Remember the CPTI credo: May our remote batteries and self-discipline last forever, but mierde happens. Be prepared! In trading, as in life, it's not the cards we're dealt. It's how we play them.

Mike Parnos, Your Options Therapist and CPTI Master Strategist

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Couch Potato Trading Institute Disclaimer
All results reported in this section are hypothetical. While the numbers represented here may have been achieved or beaten by our readers, we make no representation that any individual investor achieved these exact results. The tracking for the plays listed in this section uses closing prices for the day the newsletter is published and it is not meant to imply that any reader actually received those prices or participated in these recommendations (even though many do). The portfolio represented here is hypothetical and for investment education purposes only. It is only an illustration of what type of gains a knowledgeable trader might receive utilizing these strategies. If you don't get close to these results, guess what? It isn't the fault of the strategies.

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