My ETF Covered Call journal

[Covered Call]

I am a Race Car Fabricator, and I live in Auckland, New Zealand.

I have a been regular visitor here at Trade2win for over two years now.

I have been trading and investing for over 6 years now (stocks and options) over that time I have developed and refined my strategies for making money.

My core strategy is covered calls, on ETF's ( I used to use stocks, but the way the market has been this year, I have gone for the safer option of ETF's).

In this journal I will document my trades, and try to answer any questions that I feel will benefit this journal.

Please if you feel the need to make stupid comments, please do it elsewhere, I have gained a lot of good advice from this forum, and would like to give something back.

At The beginning of October, I set up a $200k account and my goal is to make between 2% and 3% return per month from my account.

Okay time to get started.

 

[Covered Call]

The ETF's that I am interested in buying are the, QQQQ, XLE, SMH, DIA, and IWN.

On October 6th 2008, I purchased,

800 QQQQ @ $33.64
600 XLE @ $53.07
1000 SMH @ $21.89
300 DIA @ $97.55
600 IWN @ $57.70

for a total investment of $144,603.75

I also sold 3 contracts of .DAVJT (DIA OCT 98 Call) for $4.05
and 6 contracts of .IWNJJ (IWN OCT 62 Call) for $0.95

for a total premium income of $1755.08

 

[Covered Call]

7th October 2008

Today I sold,

8 contracts of .QQQJL (QQQQ OCT 38 Call) for $0.40
10 contracts of .SMHJP (SMH OCT 24 Call) for $0.38
6 contracts of .XBTJI (XLE OCT 61 Call) for $1.56

for a total premium income of $1591.07

 

[Covered Call]

10th October 2008

The Market was down for the 8th day in a row.

My account like most peoples had taken a bit of a battering, so I decided to make some position adjustments.

I bought another,

300 XLE @ $39.61 (a cost basis of $48.58)
200 QQQQ @ $30.02 ( a cost basis of $32.92)
200 IWN @ $47.10 (a cost basis of $55.05)
200 DIA @ $81.58 ( a cost basis of $91.16)

for a total investment of $43,682.80.

I also bought back all my option contracts as they had lost a large amount of their value.

I then sold

5 contracts of .DAVJM (DIA OCT 91 Call) for $1.42
9 contracts of .XLEJT (XLE OCT 46 Call) for $1.27
8 contracts of .ITVJA (IWN OCT 53 Call) for $0.90
10 contracts of .QAVJG (QQQQ OCT 33 Call) for $1.12
10 contracts of .SMHJJ (SMH OCT 24 Call) for $0.62

For a total net premium income of $3434.30

 

[Covered Call]

17th October 2008

October expiration day

My .XLEJT 46 calls were looking like being called out, so just before the close I bought them back for a $0.24 profit and then sold 9 contracts of .XBTKA (XLE NOV 53 Call) for $2.47

The rest of the option contracts expired worthless

My account balance (at time of writing is) $195,361.98

The nett premiums received were $5838.50 representing a return of 2.9% for the month.

 

[Covered Call]

21 October 2008

Today I sold

5 contracts of .DAVLS (DIA Nov 97 Call) for $2.34
8 contracts of .ITVEW (IWN May 2009 49 Call) for $7.50
10 contracts of .QAVFB (QQQQ Jun 2009 28 Call) for $6.40

For a total premium income of $13,510.05

 

[Kunal of HSM]

So? What happened? are you still holding onto these stocks?