438.48 (-4.75)

02/09/2010 – ThetaOptions Margin Portfolio – BIDU CLOSED – Profit $465

We finally were able to buy back the FEB short caller.  And just in a nick of time before earnings tonight.  There’s really no sense chances $35 on $4000 in margin.

Filled Order:

BOT +1 BIDU 100 FEB 10 550 CALL @.35 debit

Position: None

Profit Calc:

Sold 500 Call= $5 Credit

Sold 550 Call = $4 credit

Bought 500 Call = $4 debit

Bought 550 Call = 0.35 debit

Profit = 5+4-4-0.35 = $4.65 Profit

Risk/Reward:

Max margin $12,750/$465 = 3.6% return in (4) weeks, that’s pretty bad; but our original margin was $4300.

01/19/2010 – ThetaOptions Margin Portfolio – BIDU FEB Short Adjusted

Bidu had a nice little pull back this morning, as a result the (MP) has decided to buy back ONE of the FEB short callers.

Filled Order:

BOT +1 BIDU 100 FEB 10 500 CALL @4.00 debit

Position & Special Note: We now have only (1) short caller..the FEB 550.

Note: Because we sold the second short caller on 1/15, we basically manage to keep our original profit  goal of $500 but have decreased the risk by $5000. Our short position went from 500 to 550. The available margin was the key to turning this trade around; and the fact that BIDU pulled back to $430 from$465.

Essentially we manage to move up the short caller to the 550 for FREE. We couldn’t be happier; that 500 naked short caller was getting extremely dangerous. Our current cost basis is SHORT BIDU @ 555 by Feb OpEx if we get assigned…I doubt that will happen, because BIDU would need to rise 110 points or 25% in 4 weeks!

01/15/2010 – ThetaOptions Margin Portfolio – BIDU FEB Short Adjusted

The (MP) is going to sell another CALL in order to reduce our cost basis on the other short caller we sold (2) days ago.   This is quite painful to watch, hopefully BIDU meets some seriously strong resistance at 500.

Filled Order:

SOLD -1 BIDU 100 FEB 10 550 CALL @4.00 credit

Position:

Position: Margin is getting quite HIGH. Theta is $52 a day a climbing.

Margin Explained:

The (MP) used another $5000 in margin to sell the 550 Call

In addition, we placed a day order to sell the 380 PUT, because it doesn’t cost us anything extra in margin.

01/13/2010 – ThetaOptions Margin Portfolio – BIDU FEB Short Initiated

Wow, Bidu is UP over 10% this morning at $430 on news that Google may pull out of China.  It’s extremely risky to short them right now, but we’re going to initiate a small Short position on them for the month of FEB by selling a naked call on margin. This trade will consume a large amount of margin.

Filled Order:

SOLD -1 BIDU 100 FEB 10 500 CALL @5.00 credit

Position: This position carries a HIGH Theta value with a slightly bearish Delta value.

Margin Calc: The margin requirement will increase quickly if BIDU rises another 10%

Risk/Reward: $4300 margin / $500 max profit = 11% within the next 30 days

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