Rhyming Markets
As I wrote on Sunday, my concern this week has been the call-side spread of my October Long Iron Condor (LIC). After today’s 1.73% lift in $SPY, I’m glad to have profitably offloaded 2/3 of this side of the position before the big run-up. So, what about the remaining 1/3?  Moving from 109.32 (today’s closing price for SPY) to 110.00 (the inner leg of my call-side spread) could easily happen tomorrow.  The break-even level for this spread–at 110.23–isn’t too much further away and remains well within one standard deviation of today’s closing price. While history h

Planning Ahead for the Week of October 12, 2009
The past five trading days were a mirror image of the week prior–instead of fearing a market pullback, we transitioned to a very bullish outlook by Friday.  In my last update, I mentioned a number of factors that could introduce renewed market confidence, and most or all of them did indeed contribute to the reversal we just witnessed. Now, instead of worrying about an impending market drop, we’re looking at upside risk as options expiry week begins. OPTIONS EXPIRY WEEK GAMEPLAN At face value, we look well positioned to ride out the end of the October Long Iron Condor (LIC) without having to close either of the call- or put-side spre

Planning Ahead for the Week of October 5, 2009
The past week brought a tide of change to the stock market.  The “window dressing” that pushed stocks higher in the twilight days of September gave way to profit-taking and anxiety about future economic conditions in October.  So, what can we expect between now and October options expiration, just twelve short days away, and what does that mean for our October Long Iron Condor (LIC)? First, the good news, which might push stocks higher: 1) Earnings.  Yes, it’s earnings season already.  Look for results from Alcoa, Mosaic, and Yum! Brands–among others–to potentially reassure investors that profitability is sti

October 2009 $SPY Long Iron Condor Update
October 2009 $SPY Long Iron Condor Today, I closed out the 95/92 put spread (net debit $0.08, 22% profit in 31 days) from my October 2009 Long Iron Condor (LIC) and re-deployed the capital into a 100/97 put spread (net credit ($0.23) for the same period.  The rationale is that, with the 1.79% gain in SPY, there was

October 2009 Long Iron Condor Update
What a week it has been!  I’m somewhat stunned that my predictions for the past week were so accurate.  (See here.)  To recap, I was expecting an opportunity to move out of the November Long Iron Condor (LIC) as the market moved temporarily lower.  My target date for a significant market reversal was Thursday, September 24, and that’s exactly when it arrived.  In the interim, I’ve re-invested the proceeds of the November LIC into additional October LIC positions, which will be det