Has investing changed forever? Have we just entered The End of The World As We Know It? I don't believe investing has changed. Another 500 point intraday drop and another 90% day in terms of adv/dcl volume is simply another day in the bottoming process. That process can take a week or two or a month or two but we will bottom and the resulting rebound will last for many months or at least that is the hope of all investors.

As long as Europe is teetering on the edge of disaster we could wake up any day to another triple digit move. Fortunately this is as damaging to them as it is to us so they will eventually put some bailout plan in place that will end the day to day uncertainty.

That eventuality did not help us today and we were stopped out of both remaining positions at the open. The two new recommendations were not triggered since the S&P was never positive.

The futures are down -9 again tonight and the night is still young. There are no recommendations for Friday. I will update again on Sunday and we will see what the new week brings.

Jim Brown



Current Portfolio


Current positions


Current Position Changes


WYNN - Wynn Resorts (Closed)

WYNN positively imploded today with nearly a -$12 decline thanks to a downgrade of Las Vegas Sands and the very ugly Philly Fed Report. The option opened at $3.15 for a 45-cent loss.


HANS - Hansen Natural (Closed)

Hansen only lost 30-cents for the day but it opened at $79.17 to trigger the stop at $79.50. The option opened at $2.35 for a 20-cent loss.


New Short Put Recommendations


None


New Covered Call Recommendations


None


New Long Term Recommendations


None


New Aggressive Recommendations


None until a positive market trend returns


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.