Saturday, April 18, 2015

Financial Planning: Weekend Update - April 18

What a week! On Monday the market basically gave up Friday’s gains, Tuesday and Wednesday got ‘em back, Thursday was pretty much flat and then the bottom fell out on Friday. By 3:00 every single stock in my portfolio was in the red and by closing the market as a whole was down about 1.5%

The only OTM positions were F and MO - no surprise there. As a result I had the opportunity to do the major restructuring I mentioned last week. The portfolio position as a whole showed a gain of 3.4% for the 5 weeks it’s been active.

What to do now? I've got $288,350 in cash from the assigned positions plus the $7,209.50 in dividends and premium from my March activity. I've got 1000 shares of F, now worth $15, 760 and 500 shares of MO worth $25875.00 for a total of $329,95o. Add in the $7609.50 in option premium and dividends for a total of $337,594.50. That's a net gain of $11,141.50 or 3.41% for the 5 weeks I've had this position. Note that the F position still has another week until it expires so I'm just going to let it ride until then.

So... as I mentioned last week I'm re-allocating into 10 positions of roughly equal dollar value:

Ordinarily when establishing a covered call position with new underlying you want to place what's called a "buy/write" order. You won't save anything in commissions but you get the price you want on the position as a whole. And that's what I'd normally do. But since this is paper trading I'm going to use this methodology: Buy the Underlying at the open. Use the bid price as soon as each underlying rotates in.

Check back Monday evening to see where things stand!

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