Saturday, December 12, 2015

Financial Planning Wekend Update: December 12, 2015

Monday December 7, 2015

Nothing happened in the account last week, hence the two week gap.

I opened a new position in Altria (MO) with the following Buy/Write:

Commission and fees came to $13.61 so I have a cost basis of $57.7226. There are only two weeks left in the calls and I expect to be able to write at least twice a month against this underlying. At this point I have approximately half of my retirement funds in this IRA and the rest will stay in my 401(k) until retirement.

The market gave up a good chunk of Friday's gains so volatility is jacking up option premiums. It's looking like I will have to roll out my MRK position on Thursday but that should be the only other activity this week.

Tuesday December 8, 2015

The S&P closed down another 10 points. Maybe I won't have to roll MRK.

Wednesday December 9, 2015

Altria (MO)  declared the expected $0.565 dividend payable January 11 to shareholders of record December 24. My current position expires on the 18th so I'll be writing new calls on the 18th if I have to roll out or the 21st if they expire so I probably won't have to worry about early assignment due to the dividend as there will be plenty of time left in the contract.

Thursday December 10, 2015

I rolled out my MRK position to the February $52.50 for a net credit of $764.16. The full story of this roll out was posted as Avoiding Early Exercise of Covered Calls over at Seeking Alpha.

Friday December 11, 2015

That wraps up a nasty week in the markets with a nearly 2% drop in the S&P 500. Most of my positions expire next week and the best that can be said at least they're out of the money. As of today they look like this:

Only HCP is in the money but with the Fed Reality Day set for Wednesday I will not be at all surprised to see it drift under my strike.

Next week should be interesting and I hope not too painful. Friday is a "triple witching" expiration so there could be some additional volatility at roll out time.

1 comment:

Henry Hansen said...

Picking the right companies to back is a skill. Market prices can be volatile, but, picking stocks on the up, setting stop losses or trailing losses is key to growing your retirement fund. Don't be disheartened, everyone has weeks were we can do nothing right in the market, it's a race not a sprint.

Henry Hansen @ Ethica Private Wealth Specialists

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