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December


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Dec 06, 2013 DIA 154/156 Put 0.20 0.00 11.1% expired for profit
Dec 06, 2013 IWM 107/109 Put 0.20 0.00 11.1% expired for profit
Dec 06, 2013 RUT 1080/1090 Put 0.90 0.00 9.9% expired for profit
Dec 06, 2013 SPY 173/175 Put 0.18 0.00 9.9% expired for profit
The DIA position averaged 11.1%
The IWM position averaged 11.1%
The RUT position averaged 9.9%
The SPY position averaged 9.9%

Average return for all positions: 10.5%

SPECIAL NOTE ON THIS MONTH'S TRADE: December brought on the heated debate on whether or not the Federal Reserve will begin tapering on their $85 Billion per month bond buying program. They decided that the US economy is stronger than most people suspect and felt it to be the right time to scale back on their latest Quantitative Easing effort. The markets didn't like the news at first, but quickly turned around, sending the Dow and S&P500 to record highs. Sentiment is still positive after the announcement and the Santa Claus rally will more than likely occur, pushing the major indices to even more record highs.

November


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Nov 06, 2013 IWM 105/107 Put 0.13 0.00 7.0% expired for profit
Nov 05, 2013 RUT 1060/1070 Put 0.75 0.00 8.1% expired for profit
The IWM position averaged 7.0%
The RUT position averaged 8.1%

Average return for all positions: 7.5%

SPECIAL NOTE ON THIS MONTH'S TRADE: QE and the flow of cheap money have been driving the major indices higher with the S&P finishing up about 1.5% just this week. Economic data have been mixed, but not bad enough to keep the bulls in check and investors have been satisfied to ride the wave for as long as it lasts. Our IWM and RUT positions expired worthless for a gain of 7.0% and 8.1%, respectively, for an average gain of 7.5% for this month. We will be monitoring the news and developments as we look ahead to our next trades. More updates and alerts will follow so please be on the lookout. Until then, have a great weekend!

October


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Oct 09, 2013 DIA 141/143 Put 0.19 0.00 10.5% expired for profit
Oct 10, 2013 IWM 100/102 Put 0.19 0.00 10.5% expired for profit
Oct 10, 2013 RUT 1010/1020 Put 0.72 0.00 7.8% expired for profit
Oct 10, 2013 SPY 162/164 Put 0.20 0.00 11.1% expired for profit
The DIA position averaged 10.5%
The IWM position averaged 10.5%
The RUT position averaged 7.8%
The SPY position averaged 11.1%

Average return for all positions: 10.0%

SPECIAL NOTE ON THIS MONTH'S TRADE: This cycle was full of political and economic turmoil as the US government shut down for over 2 weeks and the US debt ceiling was increased in the final hours preventing a catastrophic US default. The VIX shot up over 21 as we neared the default deadline only to collapse below 13 after a deal was struck. Although a deal was struck, it only kicked the can down the road a little ways as it imposed another deadline in the months to come. What we experienced this cycle may very well repeat itself again.

September


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Aug 28, 2013 DIA 139/141 Put 0.16 0.00 8.7% expired for profit
Aug 28, 2013 IWM 93/95 Put 0.17 0.00 (10.4%) expired for profit
Sep 13, 2013 108/110 Call 0.05 0.41 closed 108/110 for 0.36 net debit.
Aug 28, 2013 RUT 935/945 Put 0.70 0.00 (12.4%) expired for profit
Sep 12, 2013 1085/1095 Call 0.35 2.20 closed 1085/1095 for 1.85 net debit.
Aug 29, 2013 SPY 154/156 Put 0.17 0.00 9.3% expired for profit
The DIA position averaged 8.7%
The IWM position averaged (10.4%)
The RUT position averaged (12.4%)
The SPY position averaged 9.3%

Average return for all positions: (1.2%)

SPECIAL NOTE ON THIS MONTH'S TRADE: September is historically the worst performing month of the year but that was not the case in 2013. The Fed's "easy money" program continues, Larry Summers pulled himself from the running for new Fed Chief, and the Syria crisis took a back seat. All bullish signs that pushed the markets to log new record highs.

August


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Jul 24, 2013 DIA 159/161 Call 0.14 0.00 (11.3%) expired for profit
Aug 08, 2013 149/151 Put 0.07 0.42 closed 149/151 for 0.38 net debit.
Jul 25, 2013 IWM 108/110 Call 0.13 0.00 10.7% expired for profit
Aug 08, 2013 99/101 Put 0.07 0.00 expired for profit
Jul 26, 2013 RUT 1095/1100 Call 0.22 0.00 10.3% expired for profit
Aug 09, 2013 1015/1020 Put 0.27 0.00 expired for profit
Jul 25, 2013 SPY 174/176 Call 0.10 0.00 9.5% expired for profit
Aug 09, 2013 163/165 Put 0.08 0.00 expired for profit
The DIA position averaged (11.3%)
The IWM position averaged 10.7%
The RUT position averaged 10.3%
The SPY position averaged 9.5%

Average return for all positions: 4.8%

SPECIAL NOTE ON THIS MONTH'S TRADE: The markets seemed to have topped out this cycle with a shift to the downside towards the end. The bears pressured the markets lower and eventually took control as we neared expiration. The move forced our traders to close down one of the positions for a minor loss but were able to pull out a positive return for the month. Analysts anticipate the Fed to begin tapering its stimulus program next month. We will see if they actually do and how it will affect Wall Street.

July


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Jun 26, 2013 DIA 139/141 Put 0.17 0.00 9.3% expired for profit
Jun 26, 2013 IWM 88/90 Put 0.19 0.00 10.5% expired for profit
Jun 26, 2013 SPY 149/151 Put 0.15 0.00 8.1% expired for profit
The DIA position averaged 9.3%
The IWM position averaged 10.5%
The SPY position averaged 8.1%

Average return for all positions: 9.3%

SPECIAL NOTE ON THIS MONTH'S TRADE: The markets recovered from the recent selloff and reached new record levels during this options cycle. The Fed continues its bond buying program and promise to keep liquidity in the markets until the economy improves. The markets will probably continue this upward bias until the Fed announces that it will taper its easing program and increase interest rates.

June


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Jun 07, 2013 DIA 145/147 Put 0.17 0.40 (12.6%) closed 145/147 for 0.23 net debit.
Jun 07, 2013 IWM 92/94 Put 0.19 0.00 10.5% expired for profit
Jun 07, 2013 RUT 930/940 Put 0.85 0.00 9.3% expired for profit
Jun 07, 2013 SPY 156/158 Put 0.18 0.45 (14.8%) closed 156/158 for 0.27 net debit.
The DIA position averaged (12.6%)
The IWM position averaged 10.5%
The RUT position averaged 9.3%
The SPY position averaged (14.8%)

Average return for all positions: (1.9%)

SPECIAL NOTE ON THIS MONTH'S TRADE: The highly anticipated selloff finally arrived during this cycle. The Dow fell from a record high, intraday level of 15,542 to as low as 14,688, a drop of over 850 points or 5.49%. About 600 of those points came from a 2-day selloff on June 19 & 20. The VIX (volatility index) spiked to over 21, a level unseen since December 2012, reflecting fear from traders. As the June options cycle ends, the future of the markets is up in the air. The Fed has been propping up the markets for years and the stimulus will eventually come to an end. Investors fear that the economy will not be able to stand on its own without the government's help.

May


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Apr 24, 2013 DIA 151/153 Call 0.08 0.50 (21.9%) closed 151/153 for 0.42 net debit.
May 10, 2013 IWM 99/101 Call 0.08 0.12 (2.1%) closed 99/101 for 0.04 net debit.
Apr 26, 2013 IWM 97/99 Call 0.10 0.50 (21.1%) closed 97/99 for 0.40 net debit.
Apr 26, 2013 RUT 980/990 Call 0.45 2.50 (21.5%) closed 980/990 for 2.05 net debit.
May 10, 2013 RUT 995/1005 Call 0.45 0.00 4.7% expired for profit
Apr 25, 2013 SPY 164/166 Call 0.08 0.50 (21.9%) closed 164/166 for 0.42 net debit.
May 10, 2013 SPY 166/168 Call 0.06 0.80 (38.1%) closed 166/168 for 0.74 net debit.
The DIA position averaged (21.9%)
The IWM position averaged (11.6%)
The RUT position averaged (8.4%)
The SPY position averaged (30.0%)

Average return for all positions: (18.0%)

SPECIAL NOTE ON THIS MONTH'S TRADE: The major averages continued to move higher, adding to record levels with no relief in sight. As long as the Fed continues to print money like there's no tomorrow, Wall Street will continue to buy stocks since companies are able to borrow cash at 0.25% interest and charge consumers many times more than that. Businesses are making more on the bottom line, but it's not through job growth or increased sales, it's due to the trimming of fat by laying off workers, cutting benefits, reducing hours, etc. As the unemployed lose hope and drop out of the work force, they are not counted in the total pool, thus reducing the unemployment rate. 70 out of 1000 is 7%, but 69 out of 1000 is now 6.9%. As the dropouts increase, the labor participation rate continues to decrease to its lowest levels in decades! This path is unsustainable and the Fed's "free money" program will only last for so long.

April


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Mar 27, 2013 DIA 149/151 Call 0.07 0.35 (9.8%) closed 149/151 for 0.28 net debit.
Apr 10, 2013 142/144 Put 0.09 0.00 expired for profit
Mar 28, 2013 IWM 98/100 Call 0.07 0.00 9.8% expired for profit
Apr 08, 2013 86/88 Put 0.12 0.00 expired for profit
Mar 28, 2013 RUT 985/995 Call 0.50 0.00 10.0% expired for profit
Apr 08, 2013 870/880 Put 0.45 0.00 expired for profit
Mar 28, 2013 SPY 161/163 Call 0.09 0.00 4.7% expired for profit
The DIA position averaged (9.8%)
The IWM position averaged 9.8%
The RUT position averaged 10.0%
The SPY position averaged 4.7%

Average return for all positions: 3.7%

SPECIAL NOTE ON THIS MONTH'S TRADE: The April cycle continued the uptrend setting new closing highs for the Dow and S&P500. As we neared tax day, the markets began to plateau and we started selling off. Wall Street has been waiting for a major selloff or correction for months now and the recent pullback could quell that anticipation. The old adage "sell in May and go away" could prove true next cycle but only time will tell.

March


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Feb 22, 2013 DIA 143/145 Call 0.12 0.55 (22.9%) closed 143/145 for 0.43 net debit.
Mar 06, 2013 DIA 145/147 Call 0.08 0.29 (10.9%) closed 145/147 for 0.21 net debit.
Feb 21, 2013 IWM 94/96 Call 0.12 0.39 (9.6%) closed 94/96 for 0.27 net debit.
Mar 08, 2013 89/91 Put 0.09 0.00 expired for profit
Feb 21, 2013 RUT 950/960 Call 0.50 1.20 (7.4%) closed 950/960 for 0.70 net debit.
Feb 21, 2013 SPY 156/158 Call 0.09 0.40 (12.0%) closed 156/158 for 0.31 net debit.
Mar 08, 2013 149/151 Put 0.08 0.00 expired for profit
The DIA position averaged (16.9%)
The IWM position averaged (9.6%)
The RUT position averaged (7.4%)
The SPY position averaged (12.0%)

Average return for all positions: (11.5%)

SPECIAL NOTE ON THIS MONTH'S TRADE: The budget cut deadline (March 1) came and went and there was no action from the government. Cuts were allowed to happen and threaten the possibility of lost government jobs and other programs. The reason for the non-action? Possibly because there is a bit of lag between the deadline and the actual effective date of these cuts. March 28 is when the actual cuts will begin to occur if no deal is made. The government will more than likely wait until we near this date before any serious negotiations take place. During this cycle, the markets continued higher to reach all-time highs for the Dow Jones Industrial Average. As a pullback becomes more anticipated than ever, the market just won't sell off. This may change if the March 28 deadline comes with no deal, but cutbacks would actually be better for the country.

February


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Jan 28, 2013 DIA 142/144 Call 0.08 0.00 9.9% expired for profit
Feb 07, 2013 134/136 Put 0.11 0.00 expired for profit
Jan 28, 2013 IWM 93/95 Call 0.11 0.00 10.6% expired for profit
Feb 07, 2013 85/87 Put 0.09 0.00 expired for profit
Jan 29, 2013 RUT 940/950 Call 0.50 0.00 9.5% expired for profit
Feb 07, 2013 860/870 Put 0.40 0.00 expired for profit
Jan 30, 2013 SPY 154/156 Call 0.12 0.00 11.2% expired for profit
Feb 07, 2013 145/147 Put 0.09 0.00 expired for profit
The DIA position averaged 9.9%
The IWM position averaged 10.6%
The RUT position averaged 9.5%
The SPY position averaged 11.2%

Average return for all positions: 10.3%

SPECIAL NOTE ON THIS MONTH'S TRADE: The markets added to January's gains pushing the Dow and S&P500 to multi-year highs, while the Russell2000 reached record levels. Sequestration has been pushed back to the end of February so we may begin to see some cracks in the markets. Government will more than likely wait until the 11th hour before any resolution on spending cuts are made. As usual, we will take everything into consideration before opening any position to make sure we have the odds in our favor.

January


Open Date Underlying Strikes Type Credit Debit Result Trade Notes
Jan 02, 2013 DIA 127/129 Put 0.16 0.00 10.9% expired for profit
Jan 07, 2013 137/139 Call 0.04 0.00 expired for profit
Jan 07, 2013 RUT 900/910 Call 0.55 0.00 8.7% expired for profit
Jan 11, 2013 840/850 Put 0.27 0.00 expired for profit
Jan 03, 2013 SPY 139/141 Put 0.10 0.00 10.5% expired for profit
Jan 07, 2013 149/151 Call 0.10 0.00 expired for profit
The DIA position averaged 10.9%
The RUT position averaged 8.7%
The SPY position averaged 10.5%

Average return for all positions: 10.0%

SPECIAL NOTE ON THIS MONTH'S TRADE: During this cycle, the "fiscal cliff" issue was partially resolved as tax increases were passed and spending cuts talks were pushed back to February. The Dow and S&P500 have been trading at multi-year highs not seen since 2007, before the credit crisis. All 3 of our trades were profitable and we elected to pass on the IWM position. The pricing was not favorable and our trade team does not force trades. Instead of opening a position with a good chance of losing capital, our team passed on the IWM and focused on the other opportunities for the cycle.