Expiration - Weekly Review
February 17th, 2008. Posted by AppleOption
Once a month, every third Saturday, the market has another options cycle come to a close. Yesterday was option expiration day. While Friday was the last day that options could be traded.
We saw the typical struggle between the bulls and the bears. There is no denying the market continues to have substantial concern of possible recession. The subprime and extended financial meltdown have been with us for over a year now. We have reached the point were the banking system is on the verge of collapse, however the Fed has been aggressively dropping interest rates as a last ditch effort to save the market. Historically, this action has led to the next bull market. Meanwhile, the retail sales report last week showed us that the consumer is not dead yet. Though with the economic stimulus package (tax rebates), the last time Bush gave away money (election rebates) we saw the worst decline in retail spending (NY Times Article). Thus, we are in a key decision moment… Are we near the bottom, or is it still a long ways down?
Does it matter? Our Portfolios continue to show great resilience in the current market.
The Index Condor Portfolio is up 15.12% year-to-date, despite the fall in January.
The AppleOption Long-Term Portfolio (LTP) has taken a hit in the short term, but has a focus on 2010. Between now and then the economic picture will likely improve as will the value of Apple. Thankfully, the recent decline has been extremely generous, and AppleOption has taken full advantage of these “cheap” prices.
The AppleOption Short-Term Portfolio (STP) realized a 12.4% gain with the last option expiration cycle and have trades working their way to a targeted 25.9% return next month.
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