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FAREWELL TO PREMIUM, FOR NOW

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Sayonara, Adios, & Farewell To Premium
Remember the VIX? Well, you better take a good look at it because the damn thing is going away - and along with it, our premium. Just a week ago is was over 12.50. Now, it's disappearing before our very eyes. It hit a new 52-week low today (9.64). Can it go to zero? Probably not. But, current levels aren't conducive to healthy (and safe) trades. As premium sellers, we're in a difficult spot. Do we expose ourselves to the market for a longer time, or do we try and cheat a little with the strike prices and narrow our range?

Fortunately, we took advantage and put on a few decent January positions last week. As our December positions are about to expire worthless, we will take the money that has becomes and begin our search for new positions.

It would be nice to find another January position, but the chance of that happening is almost as good as me starring in a Jenny Craig commercial. So, as ludicrous as it sounds, I'm going to be looking at February positions. I'll understand if some students prefer not to go to February so soon. But, cheating with the strike prices is out of the question. If you have an alternative, I'm listening . . .

It's That Time Of The Month
Every month at this time, we talk about the value of having a broker who will release maintenance dollars on Friday after settlement numbers have been announced. This month is no different. Progressive brokers know what's going on and have made policy changes to allow for the release of your funds for use on Friday. Neanderthal brokers, who seem to have only recently started to walk upright, claim "policy" prevents them from releasing money.

The broker business is highly competitive. Since Wade Cook (that evil, but charming, fellow) made the world aware of options in the mid-late 1990s, the number of option traders has increased exponentially. To handle this increase in options trading, brokers who specialize in option trading have sprung up and continue to come out of the woodwork.

Option traders who managed to continued to learn and have survived Wade Cook's teachings, have become more sophisticated - and more demanding. The options market is growing daily. As the market demands, brokerage policies will eventually change. As option traders continue to become more sophisticated, they recognize the value of option brokers who have adapted to the market.

Having funds available Friday afternoon may not seem like a big deal. But we options traders are competing with the professionals. With commissions and slippage, etc., we're already entering every trade at a disadvantage. If we find a worthwhile trade on Friday afternoon, it's only makes sense that we have that money available to use if we choose. There's no reason for the brokerage firms to hold it. They are no longer at risk in any way. The flexibility offered by us having those funds available can make the difference of an extra nickel or dime in premium on our bottom line. That's not chump change.

Our strategy of Iron Condors and various credit spreads help increase our probability of success on our side. We don't need a broker with antiquated policies holding us back. It's these same Neanderthal brokerage firms that don't permit their clients to use our strategies in their IRA accounts.

Hey, it's your money. But you're supposedly here to learn. This is something that is actually under your control. Change can be difficult, but you should suck it up and do it. It's for your own good. Don't believe me? Ask your mom. She'll tell you the same thing.

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Dallas Here We Come -- with Washington Not Far Behind
Many thanks to all of you who sent me your preferences for the location of our April seminar. Washington, DC was the clear winner. So, today, I finalized the details for the Washington seminar.

There will be a change of date, though. My brain must have taken the day off when I originally picked April 7/8. It turns out that weekend is Easter weekend and I know many CPTI students have obligations to go on Easter egg hunts, devour ham, and tolerate a roomful of relatives.

So, the dates have been changed to protect the innocent and obligated. We'll be holding the seminar in Washington, DC on April 21st & 22nd. Now, all you accountants out there have no excuse not to attend.

Give Yourself An Early Xmas Present - At A Discount
For traders interested in attending both the Dallas seminar on March 10th & 11th or Washington, DC seminar, I offer you an "Early Bird Special." If you reserve your spot prior to January 15th, you will save $100. Give yourself a Christmas present. You deserve it. If you don't deserve it, give it to someone who does.

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CURRENT DECEMBER CPTI PORTFOLIO POSITIONS
CPTI December Position #1 - RUT - Iron Condor - 794.22
With the RUT at about 760, we sold 20 December RUT 680 puts and bought 20 December RUT 670 puts for a credit of about $.45 ($900). Then we sold 20 December RUT 830 calls and bought 20 December RUT 840 calls for a credit of about $.60 ($1,200). Our total net credit and profit potential is $1.05 ($2,100). Maximum profit range of 680 to 830 -- 140 points!! Maintenance is only $20,000 -- IF you have the right broker.

CPTI December Position #2 - RUT - Bull Put Spread - 794.22
We sold 20 December RUT 730 puts and bought 20 December RUT 720 puts for a credit of $.50 ($1,000). Our net credit and profit potential is $.50 ($1,000). Maintenance is $20,000. We'll look for a bear call spread, but don't hold your breath. With the market trending up, we're probably going to be satisfied with the bull put spread.

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CURRENT JANUARY CPTI PORTFOLIO POSITION
CPTI January Position #1 - RUT - Bull Put Spread - 794.22
We sold 20 January RUT 690 puts and bought 20 January RUT 680 puts for a credit of $.50 ($1,000). Our net credit and profit potential is $.50 ($1,000). Maintenance is $20,000. If the market stops trending, we'll look for a bear call spread to complete our Iron Condor.

CPTI January Position #2 - SPX - Iron Condor - 1425.49
We sold 12 January SPX 1300 puts and bought 12 January SPX 1285 puts for a credit of $.70 ($840). Our net credit is $.70 ($840). We also sold 12 SPX January 1470 calls and bought 12 SPX January 1485 calls for a credit of $.60 ($720). Total net credit and profit potential of $1.30 ($1,560). Maintenance is $18,000. Maximum profit range is 1300 to 1470.

CPTI January Position #3 - OEX - Bull Put Spread - 661.71
We sold 20 January OEX 615 puts and bought 20 January 605 puts for a credit of $.40 ($800). Maintenance is $20,000. We'll keep watch for an appropriate bear call spread to complete our potential Iron Condor.

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ONGOING STRATEGY - THE ZERO-PLUS Strategy
In the past, I outlined a strategy based on an initial investment of $100,000. At that time, $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. We are not compounding our profits by dramatically increasing the number of contracts we trade. We have now generated $51,050 ($47,250 + $3,800).

New Zero Plus Position: To Be Announced

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CPTI SPRING 2007 SEMINAR SCHEDULE!
Dallas, TX - March 10 & 11
Washington, DC - April 21 & 22

If you really want to take your trading from a "hobby" to a potentially profitable "business," you need the information you'll learn at my CPTI seminar. You'll learn more than the "how to's" of trading our strategies. You'll learn a new lifestyle - one that can last a lifetime.

DO YOU HAVE PROFIT-ABILITY?
It's always a challenge (and a pleasure) for me when I have a roomful of bright people who have a passion for, and are excited about, learning. We go over everything imaginable - from the non-directional strategies to the psychology of trading. We cover a lot more than the mechanics. Inquiring minds want to know the whens and the whys, not just the hows. That way, they're prepared for the best (and the worst) - and know the best way to handle either situation. There are still spots open for Los Angeles. Contact me and I'll personally call you with all the details.

If you're a SERIOUS options trader, and you want to learn the nuances of our advanced non-directional trading strategies and hone your trading skills, contact me ASAP at mparnos@optioninvestor.com. I'll call you with all the pertinent information. The price is a bargain - ONLY $995.00 -- less than the profit from one Iron Condor trade -- and you'll have a two-day experience that you'll remember, and profit from, for a lifetime. Our CPTI seminars are limited to ONLY 25 ATTENDEES. Remember, if you attend one of my CPTI seminars, you are entitled to RETAKE the seminar a SECOND TIME at NO CHARGE!

45 OUT OF 48 PROFITABLE MONTHS!! - Soon to be 46!!
WANT TO ACHIEVE SUCCESS WITHOUT STRESS?
OF COURSE YOU DO!!
USE OUR CPTI WEALTH-BUILDING TECHNIQUES!

You should definitely attend one of my seminars, if you can. With what you learn, you'll see a substantial increase in your trading results. Contact me at: mparnos@optioninvestor.com. If you've already signed up, I'll see you there. If you haven't signed up, what are you waiting for?

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HAPPY TRADING!
Remember the CPTI credo: Our remote batteries and self-discipline should 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 (though many often do) 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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