Trade closed: May 2009

I closed out the May 155 calls today for .03 - I planned on closing them at .05 but waited another day to see if I could get a lower price. With the release of the stress test at 5pm, I didn't want to take the chance that the markets takes off tomorrow. For a cost of $30, I don't mind taking that risk off the table. I plan on placing a June put trade soon - hopefully in the next day or two some downside momentum comes back into the market and increases premiums. I am feeling better that the March lows wont be re-tested so I may put on a 100 - 104 strike trade. I'm also thinking that in order to save on commissions, I may sell the NDX (MNX's big brother - the MNX is 1/10th of the NDX). Selling 1 NDX put costs me 1.25. So if I wanted to sell 15 MNX contracts I would pay $18.75, but if I sold 1 NDX and 5 MNX options, I would pay $1.25 plus $6.25 or a total of $7.50, saving $11.25 in the process.

Index level: 138.98
Buy to close: 10 May 09 155 Call
Cost to close: .03
Initial Margin req.: $3,410.00
Commission: $0.00
Net debit: $30.00
Profit: $147.50
Days open: 22
Simple return: 4.33%
Yield: 71.84%
% to ITM: 11.53%