May 30 2008
Closed SPY Calls
Last Friday I bought a couple of calls on the S&P 500 ETF, SPY. SPY is having a very hard time crossing its 10 and 20 day moving averages and staying above it. It made it above both lines yesterday and today, but both days fell back below it. Around my lunch break, while SPY was trading at 140.35, I sold both of my call options on SPY and paid $258.50 with commissions. That gave me a profit of $57.01 for the past week. That’s a 28% return in one week. Too bad I only went in with $200.
I’m going to continue to watch SPY and will trade it more often if possible when I see good opportunities like last Friday. For now, I think the risk to the downside is closer to even with the potential upswing for a near term option. When I see the risk/reward more lopsided again, [...]
Original post by Alex Fotopoulos