Today is Sunday, September 11th. As a retired New York City firefighter, I am always involved in some events remembering the horrible day. There are many memorials services all over the city. From small ones at individual firehouses, to larger ones at permanent memorial sights or the big service at ground zero. Sometimes I even go on the 9/11 motorcycle run which starts at Jones Beach on Long Island and ends at ground zero. Sometimes I just stay at home alone and listen to the names being read on TV and do my own thing. Some years are worse than others when it comes to how emotional you feel which may dictate what you decide to do. This year, for some reason, for me was more thought provoking and emotional than past years. I’m not sure why, maybe because today marks the 15 year anniversary. What ever it is, I’m missing many friends a little more today. Last night I stayed at my apartment in Manhattan which is located in midtown. I got up early, listened to names being read on TV and went to the firehouse close by, they had a small service outside on 40th Street. I have a few good friends at that house. Then I went to Fiore’s Pizza which is in Greenwich Village. As you know I own Fiore’s which is named after one of my closest friends and FDNY basketball team mate Mike Fiore, who made the supreme sacrifice on September 11, 2001. I like being there because firefighter friends stop by during the day to have a slice and a beer and look at pictures of Mike on the wall. One of the friends who stopped by was Pat Hannifin. Pat is the brother of Tommy Hannifin who was also on the FDNY basketball team with me. Tommy also made the supreme sacrifice on September 11, 2001. Pat and I had a few slices and went to the Greenwich Village Firehouse where Tommy was a firefighter. They had a mass close by, then a luncheon at the firehouse house on the apparatus floor for family and friends. As the afternoon grew old I was not feeling very social so I came home. I didn’t do much this year but as I explained earlier, on 9/11 you do whatever your heart tells you to do. Now I’m home, continuing to remember and getting my report done. So let’s get to it!
With the market I had another very nice week. Things aren’t looking very bright for this week but I was able to lock up some money while the market was going down. The reason is because of my “Triple Play Hedge” and other hedging I did to bring in money while the market was going down. All of this hedging was selling Calls not buying Calls or Puts. If I did buy some hedging I might have done a little better because the market took such a big drop on Friday. Because of this drop my account is down a little but I still locked in some money. Many of the Calls I sold this week were Naked Calls so as the stock went down my Calls gained in value. I do own some stock but I had a lot more contracts of Calls sold than shares of stock I own, so it worked in my favor. This week could have been very bad if I only owned stock and not had any Calls sold. Let’s take a look at the deals that came to an end this Friday. Two involved Gopro and one with U.S. Steel.
Gopro
Last Friday the 2nd I sold a 50 contract Put on GPRO. I brought in a $700 premium but it didn’t work out as well as I would have liked. I would have liked if the stock closed on Friday above my Strike Price and the Put would have expired. This is the risk you take when selling Puts. The stock might be put to you. My Strike Price was $13.50. With the “bad” down day on Friday, the stock closed at $12.85. It was down with everything else! The stock was put to me so I bought it for the $13.50 and the stock will open tomorrow somewhere in the $12.85 area, I hope! The bottom line is I keep the premium, I own the stock and I move on. I previously owned 5000 shares of GPRO covering a LEAP option. Now with these new shares I now own 10,000 shares of GPRO. This week can be interesting to see what I do to make this a big positive.
Profit +$700
On Tuesday I was not feeling good about the direction U.S. Steel (X) was moving. The concern was that I own 10,000 shares. I’m not overly concerned because these shares are covering a 100 contract LEAP expiring in January but you still don’t want to own stock going down, especially when it’s 10,000 shares. So on Tuesday I sold a 100 contract to have some hedging (insurance) against the stock moving down. It worked out pretty well! It was a 4 day Call and it brought in a premium of $4100. This Call had a Strike Price of $19.50 and the stock closed at $17.03, well below the Strike, so this $4100 goes into my mattress. Because these shares are covering the January Call I might be holding them until then. If you are going to be in this business you must develop a tolerance to be able to handle the ups and downs of the market.
Profit +$4100
Gopro
Also on Tuesday I did a “Triple Play Hedge” on GPRO. If you’re not familiar with my strategy please hit the link and read up. I sold three Calls on the 5000 shares I own and the first Call expired Friday. This was a 50 contract $14.50 Call with a premium of $1500. The stock closed at $12.85 so this Call expired and I keep the $1500. I still have two more Calls on GPRO which expire next Friday, and Friday the 23rd. This week I may keep the “Triple Play” the way it is with two Call remaining or I might sell another Call to give it the three Calls again. I’ll have to see how the market is going to move this week to see if I need additional hedging. Stay tuned!
Profit +$1500
I’m looking forward to this coming week to see what I can do with the positions I presently own and see what position I can add to my Active Positions.
TOTAL WEEKLY GAIN +$6300
Steve
The Options Coach