This options cycle was a bit heavier for me as I had a larger number of positions with options involved – when compared to recent months – coming into the final week of expiration. I managed to come into Friday with 9 option trades left (or pieces) that I wanted to expire, allowing me to keep the premium collected when sold – or to get good value out of owned Puts.
I was fortunate that all the trade exits went according to plan on Friday.
There were a few key differences in my trade exits this cycle, something that I have not seen before:
- A large number of the collared positions were converted to Bear R/R trades allowing me to profit from the further decline in price. I do this frequently, but the percentage of trades in this scenario increased dramatically.
- No trades were capped (covered call that was ITM) which had been a pattern lately.
- The percentage of pre-earnings to post-earnings trades with options continued to be in a similar ratio.
- The Fab 5 basket of stocks had a rough week, and would have been much worse had it not been for the option protection. I have not had a week prior to now where every position was effected so this is an unusual situation.
- I did a “lotto” trade in $DIS which, true to form, was indeed a notto lotto trade. Defined risk at $.03 but still shows what the typical result is.
- the $MNST straddle trade turned out very well leaving me with a long January 2013 45 straddle at a net cost of $1.40 — expect this trade to do well. I don’t do a lot of these trades but look to expand their use over time (sell one straddle to buy another, out-month).