October 30, 2011 Trade Update

Hi All,

I picked a great time to go away! I’m sitting here in 80 degree weather while my neighbors are shoveling a foot of snow. As I said trade updates will continue to be very slow till I return.

What a day Thursday, we had a huge up day after that insane rally we’ve been having. Needless to say, I had to take a break from my activities Thursday afternoon and make some adjustments to the positions. Below is a quick lowdown on the positions.

The Nov 55:

Since I was traveling and this was my most sensitive position, I pulled off the 690 butterfly and bought 2 – 690/710 call verticals early Thursday morning to flatten Delta since I could not watch the market most of the day. Late in the day Thursday, around 3:30, I came in and bought 2 – 700/750/800 put butterflies. Currently the position consists of (2 each) 710, 730 and 750 butterflies AND 2 – 670/690 call verticals and 2 – 690/710 call verticals. The position is down about $1300 and should be able to hold till 785 without adjustments before max loss. Even if the market does hit these numbers however, I will come in with the method 15 trade and save it as I’m sure I can outrun the market at this point. I’ll explain the process IF it comes to pass.

Below is the current position:

The November m3 trade:

I sold 1- 670 butterfly, bought 1 – 710 butterfly and sold a 640/650 call vertical late Thursday afternoon. The position is not exactly as I’d like it but will due for now.

The current position is up about $200 and is shown below:

The Dec 55 day trade:

I closed the open position and bought (2 each) 720, 740 and 760 butterflies. The position is currently down about $800 and is shown below:

And last but not least, The Dec M3:

This trade I did nothing to.

If you remember, I accidentally bought an extra butterfly on entry of this position. Well that was a bigger mistake than anticipated. I’ve been trying to dump the third butterfly at break even since I bought it but that has not happened as of yet. I’m not overly  concerned about the position as we got plenty of time and the market is way over extended, but…. I am down a few hundred dollars where I should be break even or even up some money. The position is shown below:

That is it for now, hoping the weather and the market returns to somewhat normal conditions!

John