ETF Covered Calls

What a bloody week. I hope you blokes out there didn’t lose your shirt with the market drop this week. I was fortunate to have been called on all my ETF holdings and was sitting in cash. What’s up next week? The Fed meets August 7th so I might not get back into the game until AFTER the FED meeting but there are plenty of opportunities out there in this market.

This 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.

It’s options expiry Friday! Let’s take a quick review. I bought 800 USO at $52 and sold ATM calls for July at $1.70 so I pocketed a cool $1360 in profit (3.2% profit) in less than 33 days. I’ve now been forced to sell my shares at $52 even though USO is trading at $57. Was it a bad move? Not really since USO may drop like a rock next week along with the Dow. I reached my 3% goal for the month and am perfectly content to sit in cash now. It’ll be time to look at another 3% possible return for August (see image).

In my other account, I bought 200 shares of UNG last week and sold at-the-money calls for $0.95 to pocket $175 (2%) in one week! UNG closed at $41.10 so I should get called and sit in cash as well.

What’s up for August? UNG is hot along with FXI, GDX and IWN. With ever increasing volatility, make sure you watch your back.

This 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.

I picked up 200 shares of UNG and sold July 20th (UNGGO) at-the-money calls for $0.95 in my mini-account. With only 5 days till expiry, I picked up a 2% return! I’m not sure if I’ll get called or not but it appears UNG has stabilized from its 4% drop today and I’m hoping I got in at the bottom.

This 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.

I’m amazed.  FXI (China) is still rocketing up past the stratosphere and onto the moon.  I’ve seen this go from $50s a year ago to nearly $150 today.  It’s just too hot for my taste and my gut is telling me it’s going to explode somewhere in empty vacuum of space.  I’m worried about the other suspects too as they’ve been too good for too long: GDX, USO, OIH and XLE.  Everyone is talking about energy (co-workers, friends, family, etc) so that’s usually a signal for me to get out as fast as I can.  I’ve got one more week until my USO calls get called/expire.  Based on USO’s price of $54, I’ll likely get called and keep the $1300 I made a few weeks ago.  I’m not sure where to go from here.  These returns during this time frame are too scary.   I may buy heavily into DXD (double inverse Dow) as I expect the Dow to plunge back down after it surpasses 14,000 but that’s just my opinion.  Nothing makes sense right now.  Oil is climbing towards 80 and the Dow climbs toward 14k even as the US Dollars hits low against the Euro and other world currencies.   This is defying all logic and cash may be the best bet.   I’ll post a follow up next week.
Here’s the report and exercise some caution….

This 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.

Only two more weeks till options expiry!  As usual, I’m excited to see how the cash is going to tumble in.   Here are this week’s ETF Covered Call picks from the ETF-Cashinator.  The usual suspects are all here… Russia, China, Brazil, Energy & Gold.

This 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.