Options trading update: New short put positions

Previously this blog has served as sort of a trading journal, which I found useful as a way to record and track my weekly option and stock trades. Each week’s post did however take a fair amount of time to put together, which eventually conflicted with other priorities.

Going forward I thought I might try to post more frequently and in a different format, and perhaps include some different content now and then related to online stock options trading. First, though, here’s a wrap-up of stocks and options trades I’ve made over the last couple of months:

  • I bailed out of losers Citigroup [[C]] and Bank of America [[BAC]] in which I had long stock positions. I should have done this a lot earlier, and in fact could have used the losses last year for tax purposes. At least I sold at higher prices than where they are now…
  • I sold put options in the following stocks that expired worthless for nice gains:
         December: Dow Chemical [[DOW]] (I dodged a bullet on that one);
          January: Enerplus Resources [[ERF]];
         February: Home Depot [[HD]], Plains All American Pipeline L.P. [[PAA]].
  • I was put the following stocks:
         February: TEPPCO Partners, L.P. [[TPP]] (see here for details) and Prologis [[PLD]].
  • I’ve initiated new longer-term (3 to 12-month) short put positions on the following stocks: AFLAC [[AFL]], AT&T [[T]], Enerplus Resources [[ERF]], Harley Davidson [[HOG]], Johnson Controls [[JCI]], BB&T Corp. [[BBT]], NYSE Euronext [[NYX]], and PPG Industries [[PPG]].
  • I rolled over my short put positions on the following stocks: British Petroleum [[BP]], Freeport-McMoRan [[FCX]] and Kinder Morgan Energy Partners L.P. [[KMP]] and lowered the strike prices at the same time (to $45, $25/$30 and $50, respectively).
  • I rolled up my short 45-strike covered call on Amgen [[AMGN]] to a July 50 strike, and then, more recently I sold the underlying shares and bought July 40-strike calls, converting the position into a bull call spread and at the same time freeing up additional cash and reducing risk in the position.
  • Dissatisfied with the turn of events in my long stock positions in Microsoft [[MSFT]], General Electric [[GE]] and Pfizer [[PFE]], but still bullish on their long-term prospects, I sold my positions and then sold at or below-the-market LEAPS puts in each such that I’ll either recover the losses through the eventual depreciation of the options, or ultimately initiate (be put) new long positions in the stocks at much more favorable levels.
  • I had covered calls in Ameren [[AEE]] and Anglo-American plc [[AAUK]] that expired worthless. I also sold some January 2010 45-strike covered calls against Philip Morris [[PM]] and June 17.5-strike covered calls against AAUK.

Many of the above trades are defensive in nature and a reaction to the current extreme market environment. I expect to continue to aggressively reposition while attempting to navigate the current market, but at the same time I’m staying open to taking advantage of the new opportunities that are presenting themselves on almost a daily basis.

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