Do you ever wish you could turn back time and get a "do over" on some of your trades? I definitely wish I could repeat last week.

The market roared out of the gate on Monday on hopes for a Greek solution and never looked back. The Dow gained +645 points and nearly every stock that traded last week ended the week higher. It would have been hard to pick a bad play. It is possible but not likely.

If I could do last week over I would have backed up the truck on Sunday night and listed 20 new plays. Unfortunately hindsight is 20:20 we don't get do overs in real life.

So what do we do for next week? I am not foolish enough to believe the markets are just going to continue higher without a bout of profit taking. Actually the first week of July is normally bullish but the last week of June almost never gains +6% so the odds are good the historical first week gains are probably going to be lackluster at best if gains at all.

I scanned a couple hundred potential plays but all the charts on the good stocks all have 6% to 10% gains so no plays there. On the stocks without decent gains do we really want to go long on a stock that did not perform last week? Always look for relative strength before initiating a play. Without relative strength it should be avoided.

I hate to be a party pooper here but I am not going to add any plays today. If we get a decent dip I will add a couple but I would rather err on the side of caution than give back our gains by rushing into long positions after a +6% market rally.

I updated the stop losses and put some exit targets on each play. We should be able to exit three of them at the open on Tuesday assuming the market does not gap down.

Jim Brown



Current Portfolio


Current positions


Current Position Changes


None


New Recommendations


None


New Long Term Recommendations


None


New Aggressive Recommendations


None until a positive market trend returns. One week does not make a trend!


Margin Requirements:

There are several different formulas for determining margin requirements for naked put writing. These are normally broker specific and some can require larger margin requirements than others.

Here is the most common margin calculation for naked puts.

100% of the option premium + ((20% of the Underlying Market Value) - (OTM Value))

For simplicity of calculation simply use 20% of the underlying stock price and you will always be safe. ($25 stock * 20% = $5 margin)


Prices Quoted in Newsletter

At Option Investor we have a long-standing policy prohibiting the editors and staff from actually trading the individual recommendations in order to conform to SEC rules concerning trades.

The prices quoted in the newsletter are the end of day prices in most cases.

When discussing fills or stops the prices quoted are the bid/ask at the time the entry trigger or exit stop is hit. This is NOT a price that someone on staff actually got using a live order.

For entry/exit points at the market open the prices quoted will be the opening print. The majority of the time the readers are able to get a better fill than the opening print because of market maker bias at the open.

For trades with an opening qualification the prices quoted will be the bid/ask at the time the qualification was met.

All of these rules normally produce worse prices than an active trader would normally get. Because they are standardized there may be some cases where a price quoted was better than an actual fill. If you received a price that was dramatically different than what was quoted please let us know.