April 2009 Results:

Trade Placed: May 2009

On April 15th, I sold to open 10 May 09 155 calls, 17.74% otm. At the time, I was expecting the market to take a breather and decline somewhat and with less than 30 days until expiry, I was also looking to lock in more premium before it evaporated. However, it is impossible to predict with any accuracy where this crazy market will be at any point in time, so with that in mind if the market doesn't head lower by a good amount, I will look to close the trade - I've been bitten in the past for not selling options far enough otm, so I will look to limit my risk on this trade by closing the trade for a nickel when possible.

Index level: 131.65
Sell to open: 10 May 09 155.00 Calls
Credit received: .19
Initial Margin req.: $3,410.00
Commission: $12.50
Net credit: $177.50
Days to expiry: 29
Simple return: 5.21%
Yield: 65.51%
% to ITM: 17.74%
Probability of expiring ITM: 3.45%

Please view my disclosure on the bottom of this blog.