Options Expiration

Friday we saw the expiration of options which generally leads to stocks ending at round numbers or slightly below or above likely depending on the outstanding contracts of certain positions. This week ended up being profitable but very volatile which is not ideal. What is ideal is that I am at a new high in my account, I now have a 30% gain in under 1 month back trading. :-) The best thing about this is that again I am following rules and managing risk and still making very nice gains. I can only hope to keep up this pace, however I doubt it will always happen like this.

I sold my EWZ, DRYS and FXI calls at the open after they had gapped up. DRYS has been my best trade so far since being back. Had I held I could have made an extra 500 but I followed my plan of selling if it hit 110 and I locked in over a 100% gain. I considered buying a single 110 call to hold over the weekend into monday the case of a gap up. EXM(another dry bulk shipper) will be reporting earnings before the open monday and DRYS will likely benefit if there is a beat and EXM rallies. I will likely still buy in before earnings after the close, especially if there is a sell off on monday. I don't think the uptrend is over with these stocks and DRYS could see old highs(130) very easily on a good earnings report.

EWZ was getting close to my 100 target and I wanted to lock it in as well since I assumed we would see volatility throughout the day. This actually kept going up and I left money on the table, but overall I cannot be upset. I will wait for a pull back to re-enter. FXI was a wash as I got out with I think a 100 dollar loss but it basically required a move to near my target to break even due to time decay and volatility decay.

I am still holding V, FSLR and SIRF calls. V being the most painful and exception to my rules, which shows why there should be NO exceptions to any rules. FSLR is still only a slight gain for me, it has actually increased by about 4 dollars since I bought calls but time and more so volatility decay has kept it flat. I think it will start moving shortly though and make new highs especially as oil stays at highs. SIRF is again a slight gain, but it is not moving against me so I don't mind holding it.

Looking forward to next week, on monday I will get into new positions and re-diversify. I need to get more tech exposure, I will likely hop into AAPL as I feel it will be propelled back to old highs on news of upcoming products and rumors. I plan on holding a single DRYS contract over earnings, since it will only be risking pure profit and could offer a nice potential reward to the upside. I will need to find some good put plays because all of my old ones broke to the upside(and have continued up). This is why we follow rules, even though it sucks taking a 2% loss, it sucks taking a 10% loss(take V as an example). Cutting the losers short and letting the winners run has worked so far, no reason to change now. :-)

It took restraint to not enter into all my positions today at the close, especially on DRYS, but I figured there is no reason to automatically lose 2 days of time value in hopes of a gap up that doesnt develop. I think we may see a pull back if oil continues its march higher, which it shows no signs of stopping. Downward pressure from oil and commodities could influence next week. I agree in the long run this level of oil is sustainable but I think there is significant additional risk priced in, where supply and demand may be back at the 100 level we have much more fear of an issue happening. It's likely we don't see a major pull back until the end of May when refiners come out of maintenence and step up output.

It's been a great note to end the week on, financially and personally. Now if you'll excuse me I have to get back to studying for my final tomorrow(yes on a saturday). ;-)