ETF Covered Calls

Whatever chaos the markets were to undergo in January seems to be pushing off to February and March.  Perhaps this has to do with the large sovereign debt of Greece and other European nations coming due being rolled over into the latter part of Q1 and early part of Q2 but I’m still biased to the negative despite all the “good” economic news lately.

Here’s the link to ETF Covered Calls.

Here’s the link to ETF Naked Puts.

ETF Covered Calls website is for educational and entertainment purposes only. Any investment activity is not without risk including loss of principal. Neither this website nor its authors assume any responsibility arising from the use or misuse of any information presented in this blog. You are urged to contact a financial adviser before making any investment decisions. Past performance is no indication of future performance.

The new year is here!  This is the first run of the ETF Matrix Report for 2012 and it appears that doomsday has been postponed till February 2012 or at least that’s where the high xolatility has moved to but January is still suspect.    We’ll know in the coming weeks what’s going to happen here but traditionally the 3rd week of January the market tanks but we’ll see.  Still currently holding 300 FAZ at 39 to 40 with January calls at-the-money strikes sold.

Here’s the link to ETF Covered Calls.

Here’s the link to ETF Naked Puts.

ETF Covered Calls website is for educational and entertainment purposes only. Any investment activity is not without risk including loss of principal. Neither this website nor its authors assume any responsibility arising from the use or misuse of any information presented in this blog. You are urged to contact a financial adviser before making any investment decisions. Past performance is no indication of future performance.

Options expiry is here!  Let’s take a brief look at some trades:

FAZ    100    40    Jan 21, 2011   $ 650
FAZ    400    42    Dec 17, 2011   $ 1540 (Assigned)
XME   200    50    Dec 17, 2011   $ 476 (Expired)
XOP    200    52    Dec 17, 2011   $ 454 (Expired)

FAZ    100    39    Jan 21, 2011   $ 655
FAZ    200   42    Dec 9, 2011     $ 516 (Expired) – Rolled to January 21, 2011 for $1,000
FAZ    200   40    Dec 17, 2011   $ 543 (Assigned)

I went back and did the math and for my cash account, I earned $5,250 from Oct 27 thru Dec 17 options expiry.   In my power account, I made $2,500 so the total from both accounts was a little over $7,500.

So what does the future hold?  The ETF Matrix Report shows heavy put premiums on commodity (oil) and commodity heavy country ETFs so that’s the canary in the tar pit choking on economic fumes…

Most of my FAZ holdings have been assigned and I’m back in cash.  I still hold some FAZ for January expiry and if FAZ dips below $39 I may buy 100 share blocks and sell the January at-the-money strikes respectively.   As for XOP, the January $52 strikes are selling for $1.70 which is good for another 3% return on money while the XME $50 strikes are selling for $2.07 which is good for another 4% return on my money which is probably what I’ll trade on Monday although if they do rally on Monday I might just sell off.  I am still pessimistic on this market thru January.

Here’s the link to ETF Covered Calls.

Here’s the link to ETF Naked Puts.

ETF Covered Calls website is for educational and entertainment purposes only. Any investment activity is not without risk including loss of principal. Neither this website nor its authors assume any responsibility arising from the use or misuse of any information presented in this blog. You are urged to contact a financial adviser before making any investment decisions. Past performance is no indication of future performance.

A slightly more stable January showing up in the ETF Matrix Report yet still a great deal of xolatility in January.   There is considerable put buying on indexes, commodities and foreign country investments.   I am still in FAZ to the tune of about 900 shares and continue to sell calls as they expire.  I had the 2 contracts I sold expire worthless at the $42 strikes this past Friday for the weeklys and next week (Dec 17) is the monthly expiry.   We’ll see what happens but I’ll probably sell the January $42 strikes which are yielding $4.10.

Here’s the link to ETF Covered Calls.

Here’s the link to ETF Naked Puts.

ETF Covered Calls website is for educational and entertainment purposes only. Any investment activity is not without risk including loss of principal. Neither this website nor its authors assume any responsibility arising from the use or misuse of any information presented in this blog. You are urged to contact a financial adviser before making any investment decisions. Past performance is no indication of future performance.

Exciting! Exciting! Exciting!  I now hold 1000 shares of FAZ at various price points and a couple of other ETFs and have raked in almost $5000 so far in a few weeks!  Here’s a quick snapshot:

Ticker Shares Entry Expiry Cash Received

FAZ    100    40    Jan 21, 2011    650
FAZ    400    42    Dec 17, 2011    1540
XME   200    50    Dec 17, 2011    476
XOP    200    52    Dec 17, 2011    454

FAZ    100    39    Jan 21, 2011    655
FAZ    200   42    Dec 9, 2011      516
FAZ    200   40    Dec 17, 2011    543

I ran the ETF-Cashinator and January continues to look absolutely horrid.  A big move is coming in January and my bias is to the downside hence my positions.    The premiums for FAZ January at-the-money strikes are so juicy I can’t help myself since they yield nearly 17%!

Here’s the link to ETF Covered Calls.

Here’s the link to ETF Naked Puts.

ETF Covered Calls website is for educational and entertainment purposes only. Any investment activity is not without risk including loss of principal. Neither this website nor its authors assume any responsibility arising from the use or misuse of any information presented in this blog. You are urged to contact a financial adviser before making any investment decisions. Past performance is no indication of future performance.

January 2012 still looks to be a hot spot for the market.   High xolatility in calls and puts for January and onto February.   This past expiry I got assigned on most of my FAZ shares. I bought in at $39 and $40 and it’s now trading in the $50 range.    Will wait and see…sitting on cash.

Here’s the link to ETF Covered Calls.

Here’s the link to ETF Naked Puts.

ETF Covered Calls website is for educational and entertainment purposes only. Any investment activity is not without risk including loss of principal. Neither this website nor its authors assume any responsibility arising from the use or misuse of any information presented in this blog. You are urged to contact a financial adviser before making any investment decisions. Past performance is no indication of future performance.

With the increased volatility in the markets, it is starting to impact the ETF Covered Calls options deep into next year.   The previous xolatility I had seen extended to January 2012 but it’s now spilling into March 2012.  I’m not sure what it means other than continued volatility through March at a minimum.   The good news is I got called on 500 shares of FAZ and raked in a cool $3000 with some positions open through January 2012.

Here’s the link to ETF Covered Calls.

Here’s the link to ETF Naked Puts.

ETF Covered Calls website is for educational and entertainment purposes only. Any investment activity is not without risk including loss of principal. Neither this website nor its authors assume any responsibility arising from the use or misuse of any information presented in this blog. You are urged to contact a financial adviser before making any investment decisions. Past performance is no indication of future performance.

November expiry is only a few days away, I am in with about 600 shares of FAZ at various expirations (November, December, and January).   I’ll likely be assigned this Friday with some of my positions which is great.  So far, I’ve captured about $3,000 in premiums and will be happy to move back to cash after assignment.   I ran the ETF-Cashinator report and there is still a bit of anxiety (large calls & puts volumes and premiums) for January 2012.   I’m sticking with the thesis that the market will get rattled in January.   All it seems to take these days if for a foreign central bank to experience problems that send the markets tumbling….only time will tell.

Here’s the link to ETF Covered Calls.

Here’s the link to ETF Naked Puts.

ETF Covered Calls website is for educational and entertainment purposes only. Any investment activity is not without risk including loss of principal. Neither this website nor its authors assume any responsibility arising from the use or misuse of any information presented in this blog. You are urged to contact a financial adviser before making any investment decisions. Past performance is no indication of future performance.

All signs continue to point to a January meltdown (or possible rally) although I think a meltdown more likely given the crisis in Greece, the spreading yields on Italy, Ireland, Portugal against German bunds as an indicator we’re on the edge of the cliff about to fall off.   To put my money in my mouth, I’ve been buying 100 share blocks of FAZ and selling calls for November, December, and January.   I’m raking in the cash and hope to get called out if the market stalls out and dives.    The xolatility is pretty high for January so we’ll see if my thesis holds in a couple of months!

Here’s the link to ETF Covered Calls.

Here’s the link to ETF Naked Puts.

Here’s the link to ETF Covered Calls (Leveraged Edition).

Update:  I’ve added the leverage edition to this report because there is so much xolatility that it’s a must see!

ETF Covered Calls website is for educational and entertainment purposes only. Any investment activity is not without risk including loss of principal. Neither this website nor its authors assume any responsibility arising from the use or misuse of any information presented in this blog. You are urged to contact a financial adviser before making any investment decisions. Past performance is no indication of future performance.