Option Investor
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IT'S QUICKIE TIME - & NEW POSITION

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IT'S QUICKIE TIME

This damn market is fickle. That's why I'm real glad our CPTI bull put spread positions are safely far OTM. Many CPTIers dared to put bear call spreads on top of their bull put spreads. When the market spiked up this morning, many exited their bear call spreads (or should have). Then, to nobody's surprise, the market gave back all of the day's gains and then some.

A word to the wise to those of you in bear call spreads. You're not out of the woods yet. There's still another week and this market is resilient. Bad news gets discounted and good news turns into big gains.

New CPTI Position
Since November is right around the corner, we should probably take advantage of today's sell-off. The VIX was up 2.21 to close at 18.88. That brought a little more premium back into options. So, let's see how much we can snatch from the speculators and safely put into our pocket. This IS an official CPTI portfolio position.


CPTI November Position #2 - RUT Bull Put Spread
On 10/11, with the RUT at 834.98, let's:
Sell 20 November RUT 750 puts - RUTWJ
Buy 20 November RUT 740 puts - RUTWH
Credit of about $.80 ($1,600)
 

That's a cushion of about 85 points. Maintenance is $20,000. I know there are many of you who will (wisely so) want to go out further and be even safer. If you opt for the 740/730, you might get about $.50 - which is perfectly acceptable. These prices are based on Thursday's close. You know that the prices will change at tomorrow's open. Anything can happen - and probably will. Don't get greedy. Always err on the side of safety. If the market opens down a chunk, look closely at the 740/730. If it opens up, the 750/740 might be the way to go, but you may have to accept a lesser premium. In other words, we won't know what position we zero in on until we see the lay of the land in the morning. Basically, you have to think for yourself. A little common sense will go a long long way.

For those of you who use my column as a tout sheet -- just for the trades and have no idea what you're doing or why you're doing it, well, good luck. I suggest you get your butt to one of my seminars before you lose it in the market.

The above new CPTI position will also be the recommendation for the Zero-Plus strategy. The only difference is that we'll be trading 30 contracts.

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Quickie Time
Here we go again, folks. Time for aggressive traders (who should know better) to take on higher risk trades to try and get a greater reward in a one week trade than we typically make in a 4-6 week trade. Translation: It's quickie time.

Remember that quickies are for experienced traders with a high risk tolerance - especially with the market trending. I don't play the quickies - and you know they are not official CPTI portfolio positions.

October Quickie #1 - RUT - 834.98
Sell 20 October RUT 800 puts - RUTVS
Buy 20 October RUT 790 puts - RUTVR
Credit of about $.75 ($1,500)

Sell 20 October RUT 870 calls - RUZJN
Buy 20 October RUT 880 calls - RUZJP
Credit of about $.50 ($1,000)

Total net credit of about $1.25 ($2,500). Maximum profit range of 800 to 870. Maintenance is $20,000.

October Quickie #2 - SPX - 1554.41
Sell 20 October SPX 1515 puts - SXMVC
Buy 20 October SPX 1505 puts - SXMVA
Credit of about $.80 ($1,600)

Sell 20 October SPX 1595 calls - SXMJS
Buy 20 October SPX 1605 calls - SPBJA
Credit of about $.90 ($1,800)

Total net credit of about $1.70 ($3,400). Maximum profit range of 1515 to 1595. Maintenance is $20,000.

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CPTI Seminar - Next Stop L.A.
Per a number of requests, from new Couch Potato subscribers and former seminar attendees, I'll be presenting my two-day advanced seminar on the weekend of December 8th & 9th.

The popularity of option trading continues to increase. The landscape is constantly changing. There are a number of other trading vehicles being offered. Plus, some brokers are progressing with what is being offered - in the form of personal assistance, strategy education and creative maintenance options. We delve into all of the above - in depth - at the seminar.

Plus, we discuss, for hours, trade selection, entry points, exist strategies and alternatives, premium negotiation, taxes, and much more - all subjects necessary to help maximize your trading business. As you know by now, the seminars typically sell out. As in trading, opportunities aren't there for long. Reserve your spot as soon as possible.

Give yourself the gift of knowledge. It lasts a lifetime - often even longer.

Early Bird Special - SAVE $100
If you complete your registration for the upcoming Los Angeles seminar prior to November 9th, you will save $100. If you've been paying attention to my column, by now you know that every $100 you save is $150 you don't have to make. Plus, for most, it's all deductible for you.

There are now only two retake spots available for the Los Angeles seminar. These spots go quickly, so, if you're interested, I suggest you contact me as soon as possible.

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Siamese Condor Update
For those of you who acted on my post on Tuesday, you pocketed a nice $1,380. If you didn't, and you're still holding onto the position, you were dangerously close to being stopped out today when the OEX hit a 52-week high of 734.51. Our exit parameter is about 736. Based on today's closing prices, you could unwind our hypothetical Siamese Condor for about the same $17.70 - yielding the same profit of about $1,380. For more details on the position, read my 9/24 column.

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CURRENT OCTOBER CPTI PORTFOLIO POSITIONS
CPTI October Position #1 - RUT - Bull Put Spread - 834.98

On 9/7, with the RUT at 775.53, we sold 20 October RUT 630 puts and bought 20 October RUT 620 puts for a credit of $.70 ($1,400). Total net credit and profit potential (so far) of about $.70 ($1,400). Our maintenance is $20,000. We'll look for opportunities to complete our Iron Condor if/when the market pops up.

CPTI October Position #2 - SPX - Bull Put Spread - 1554.41
On 9/20, with the SPX at 1518, we sold 20 October SPX 1395 puts and bought 20 RUT 1385 puts for a credit of $.60 ($1,200). Total net credit and profit potential (so far) of about $1,200. Our maintenance is $20,000. We'll look for opportunities to complete our Iron Condor if/when the market pops up.

CPTI October Position #3 - MID - Bull Put Spread - 910.77
On 9/24, with the MID at 881, we sold 20 October MID 810 puts and bought 20 MID 800 puts for a credit of $.60 ($1,200). Total net credit and profit potential (so far) of about $1,200. Our maintenance is $20,000. We'll look for opportunities to complete our Iron Condor if/when the market pops up.


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CPTI November Position #1 - SPX - Bull Put Spread - 1554.41
On 10/9, with the SPX at 1553.50, we sold 20 November SPX 1425 puts and bought 20 November SPX 1415 puts for a credit of $.50 ($1,000). Maintenance is $20,000. We may put on a bear call spread in the future - IF it makes sense.

CPTI November Position #2 - RUT (see description above)

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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. With the July profits, our new cash total is $55,060 ($52,210 + $2,850).

ZERO PLUS POSITION -

See new CPTI SPX position as described above - trading 30 contracts.

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CPTI SEMINAR SCHEDULE!

LOS ANGELES, CA - DECEMBER 8 & 9


Take your trading from a "hobby" to a 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 to 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. Contact me and I'll personally call you with all the details.

If you're a SERIOUS options trader, 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. Send me your phone number. I will personally call you with all the pertinent information. The price is a bargain - ONLY $995.00 -- less than the profit from one Iron Condor trade. Take advantage of the "early bird special" and save $100. You'll have a two-day experience that you'll remember, and profit from, for a lifetime. I limit my CPTI seminars to ONLY 25 ATTENDEES. And, as a bonus, if you attend one of my CPTI seminars, you are entitled to RETAKE the seminar a SECOND TIME at NO CHARGE!

53 OUT OF 58 PROFITABLE MONTHS!!
WANT TO ACHIEVE SUCCESS WITHOUT STRESS?
OF COURSE YOU DO!!
USE OUR CPTI WEALTH-BUILDING TECHNIQUES!

You should definitely attend one of my seminars. 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 Trader 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.



Orders to purchase or sell securities through your account with OptionsHouse, Inc., an independent registered broker-dealer ("OptionsHouse"), shall be accepted and executed solely by OptionsHouse, subject to the terms and conditions of your individual account agreement with OptionsHouse. OptionsHouse makes no investment recommendations and does not provide financial, tax or legal advice. All inquiries regarding your OptionsHouse account, including any disputes or trading errors, should be directed to OptionsHouse. Option Investor, Inc is not a registered broker-dealer and is not in the business of transacting trades. Furthermore, Option Investor, Inc is not a registered investment adviser, does not provide financial, tax or legal advice, and is not recommending that you buy or sell any particular security. OptionsHouse has made its services available to you via Option Investor, Inc as a courtesy. OptionsHouse and Option Investor, Inc are separate and unrelated entities. OptionsHouse is not affiliated with and does not endorse or warrant the products or services of Option Investor, Inc.

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