Tuesday, October 2, 2012

Are There "Lessons" While Trading AAPL Options?

Along the same vein as the previous, I jumped into 2 10/05/12 670 AAPL puts this morning @13.20 and got out an hour later without harm.  But what scared me was that I was looking for the right price with enough volume for a fairly narrow spread.  But I had not considered how short in time they were for.  Only 3 days.  So it was a weekly, not even a monthly.  Normally I try for one with at least a month remaining, so as to be able to recover if the underslying stock initially goes the wrong way.

The other theme I had is that usually your first "trade" after a gap is a good one.  But then the inevitable issue comes up "what next."  It's the "what next" that kills you.  Your second or third idea.

Thursday, September 27, 2012

Are There "Lessons" While Trading?

OK, I've been disciplined for months now, basically layering selections of Jim Cramer from his charitable trust account.  But there's something about September that brings me down every year.  Something to do with the beautiful weather, I'm sure.

So last week I entered an option trade with 2 October 695 calls of AAPL @ 22 and something.  When it immediately turned south I "traded around" by selling 2 October 715 calls of AAPL @ 12 and something.  But I still was facing a $2000 max loss if things went south.

So, here's the lesson:

1.  Don't jump into option trading after a long time period.  You forget how you can be ripped to shreds without knowing how to get out of it.

Sunday, August 19, 2012

Naked Ballet

From the NYT this weekend: "HOW do you react to the look of a naked body onstage? Thirty-four years ago, as part of a friend’s bachelor party, I went to a London strip club with a group of seven other men. We were all in our early 20s; most of them were distinctly upper-crust; some qualified as what the English call chinless wonders and Hooray Henrys. Unfortunately, the show underwhelmed. Some of our party, good sports, feigned enthusiasm. Not all, though. As the show reached its supposed climax in a fatuously unerotic male-female nude duet, one chap leaned across the table and said, in piercing Bertie Wooster tones: “I say, Leo! Are you getting together a party for the Caledonian Ball this year? Because, if so, I’m frightfully interested.” (The Royal Caledonian Ball is a grand event of traditional Scottish dancing.)..."

Thursday, August 9, 2012

I meant to type "predatory" no prefatory (sic.) What does HTML mean? Back shortly.

Wednesday, June 13, 2012

The Incredible Hulk

Wednesday, May 23, 2012

Cramer's Best

The very best presentation by Jim Cramer, Monday.  A tour-de-force as to why financial engineering has destroyed the retail investor.


Monday, May 14, 2012

Wednesday, May 2, 2012

Chesapeake Energy

I know...I've not said anything about the games being played at CHK.  Stay tuned.

Whitney Tilson -- Again!

CNBC is about to interview Whitney Tilson for the second day in a row.  This time he was short Green Mtn.  which is just now down 40% after hours!  What a guy.

Monday, April 30, 2012

Who Remembers the Water?

Water Lawg

by Dan Kuchera (my college and law school friend who worked as an attorney in Chicago representing water companies)

He has a blog called www.waterlawg.blogspot.com.



Posted: 30 Apr 2012 08:24 AM PDT

We are told that water is valuable: that water is essential for all life--human, animal and vegetation; that water is essential for public health; that water is essential for public safety and fire protection; that water is essential for cleanliness; and that water is essential for production of food, goods and services. But, who remembers the water that we use? Who remembers the water in our shower this morning or any of yesterdays' mornings? Who remembers the water that is flushed down our toilets? Who remembers the water that made our coffee and tea during any day? Who remembers the water we sprayed on the garden or splashed down the driveway when we washed our car? Who remembers our first glass of water or any glass of water, for that matter? Who remembers the water churning in our washing machine or in our dishwasher? Who remembers the water that cleaned our floor and then was washed down the drain? Who remembers the water that was used to make soup or to wash the vegetables that went into the soup? So, who remembers water? If water really is valuable, how come we do not remember using it, yet alone protecting it like our other valuables? Maybe we will not value water, and remember it, until it is disappears.

Why Not Much Discussion About Natural Gas?

It's boring.

Whitney Tilson -- What a Guy

Jim Cramer has always been my guy.  He still is.  Add Whitney Tilson to the same airified level.  His interview on CNBC just now was awesome, not only did he virtually double his money after going long Barns & Noble last week, he gave five or more other tips and resources.

While we're discussing Whitneys, Meredith Whitney is no slouch either.

Saturday, April 28, 2012

Friday, April 27, 2012

Exactly Who Has Captured the Savings on Low Natural Gas?

“Whatever gas has taken away, natural gas has returned to the consumer.” CNBC commentator just now.

I question this, since I believe the middlemen have captured the "return," unknown to the consumer.

Cramer is starting to slam Procter.  He did so this morning on CNBC, before he had heard the conference call, which occurred at 8:30 am.  You can be sure it will be mentioned on Mad Money tonight.  He praises Clorox and all other competitors of P&G.

...Yes he did continue to slam P&G on Mad Money, praising the competition Kimberly Clark for getting pretty much everything right that P&G was getting wrong.  Said not to buy Procter as there was more falling to come in the stock price.

Tuesday, April 24, 2012


(c) 2012 F. Bruce Abel

Yesterday this TV ad appeared on CNBC (you have to click on it after going to the site):


I TIVO'd it and watched it "numerous of times."  It didn't make sense.  But a little digging shows that it's promoted by AEP which (in cases before the PUCO) is fighting to make the marketers of electricity have to pay more of a capacity charge in the non-bypassible part of the bill, so that the marketers do not scoop up unfair profits by selling below AEP's embedded rates.

The ad shows the evil (FirstEnergy) paying $.25 (the cost of one glass of lemonade at a child's stand), but taking the whole pitcher of lemonade, and then setting up a stand across the street and selling the self-same lemonade at $.25 per glass, leaving the child with no pitcher.

I approve of this ad.

Saturday, April 21, 2012

Friday, April 20, 2012

Up North


Que Pasta?

Natural Gas Spot Price - Henry Hub, Louisiana
Cook it with natural gas!  Remember the Curtailment Cases at the FERC????  "We're running out of natural gas."

Thursday, April 12, 2012

Enuf Said Already

Sunday, April 1, 2012

Utter Chaos

Utter chaos. We are all on our own without a playbook. That’s what deregulation of electricity in Cincinnati has caused. Thousands are "bargaining away" unknowingly. Marketers get us to leave the comfort of our local utility with focus on a false bogey: average price over the past time period. Who benefits? Marketers are scooping up most if not all the benefits of the plunge in natural gas market AND since January 1, 2012, natural gas is now the driver in electricity rates! We are all being scammed in ways we do not see, both on electricity and natural gas. Aggregation cuts the problem down but at a price. Stay tuned.

Thursday, March 29, 2012

Opt Out!

To my Glendale friends: this article explains my decision to opt out of the Glendale Electric Aggregation program for electricity and to stay with Duke Energy Ohio (Core Duke). Why lock up high rates until March 2014 when much better offers will be coming along shortly?


Thursday, March 15, 2012

IGS is a Ass

Glendale Alert:  IGS is the default supplier under the Aggregation program.  I researched them two or three years ago and published my doubts, based IGS on shennanigans in Massachusetts.  Just now, in analyzing a utility bill for a friend I note IGS is charging $.85 per ccf on the latest bills, about double what "Core Duke" rate is.  Look at your own recent bill and see what IGS is charging you, and report back if the amount is high.  Pass this along to other Glendalians.  My email is babel2@fuse.net.

Tuesday, March 13, 2012

Core Duke

(I will call Duke Energy "Core Duke" in this and later messages, for reasons which will become obvious. Share this message with your friends on Facebook.)

Glendale people are getting verbal calls from Future Now about natural gas rates. All such verbal solicitations are misleading, implicitly and explicitly.

I would like to see any WRITTEN material.

Until you see something in writing don't sign up. (As you know I have a jaundiced eye on these natural gas marketers in this environment.) Also remember we are basically through the winter heating season. So any long-term contract is crap, even if it is a variable monthly rate tracking Core Duke in some way.

If there is interest I will hold a meeting on the subject, either at the Lyceum or HWB.

I also have in my possession a package offer from Duke Energy RETAIL. Don't do it! (Gut call without studying it.)

Generally natural gas has collapsed. Type in "Spot Natural Gas," and then "WRGT" on Google and scroll down past the oil charts to get to the natural gas chart. Now this chart does not show the necessary slight capacity adder, but you can see that all offers (and Core Duke's rates) should be much lower than they are. And Core Duke itself should be tracking down each month.

Sunday, February 5, 2012

On to Barcelona!

Thursday, February 2, 2012

Confessions of a Pattern Day-Trader -- Back From Manila Trading

I've been restricting my blog posts to the profound. Well, I've got one.  Last week on CNBC a hedge fund guru admitted that his holding of Netflix stock required him to avoid ever looking at how it was doing within his portfolio.  Just "don't look at it."

This is the most profound secret to investing.  But you seldom hear this advice on CNBC because CNBC's very business requires that people look at it!

Wednesday, January 25, 2012

Cramer Last Night


This show plus President's speech last night!

Thursday, January 12, 2012

Will the Market Continue...

The age-old question.

The quality of the interviewers and interviewees on CNBC is so much better than in the day.  Pisani is good at the end of the day.  Cramer is always good and when his tone of voice is a certain way, you should do what he's recommending.  His housing call nears this, although if you remember he called the bottom in June of 2010 and was wrong.  He's also not good on natural gas.

El-Erian and Bill Gross are excellent.

Looking at the TV programming at Infiniti while waiting on my car, I realize there are a lot of financial programs other than CNBC.  Same conclusion being in Manila for six weeks recently -- different versions of CNBC, plus Bloomberg.

So Far This Year

So Far This Year

100 FFIV, with selling a January 115 call on same;  $12 unrealized profit

why FFIV? pin-action from Oracle's earnings report

100 American Tower Corp, no hedge:  $392.05 unrealized profit

pin-action from ATT/T Mobile breakup (bought shares in late 2011)

100 Con Ed recently rebought; will sell today: $225.95 unrealized loss
the utility trade is over for the New Year

1 long AAPL February $400 call; 1 short $425 call: unrealized profit $106

a call spread on AAPL is a safe way to bet on AAPL, until it's not

1000 shares AA (Alcoa): $75 unrealized loss

China is shutting down smelters to use the electricity (90% of aluminum is electricity); Alcoa is doing the same; yet the demand for aluminum will remain strong, especially in the US

small realized loss on put spread on GLD:  $25
was going the wrong way on this

Monday, January 9, 2012

The New Year

(c) 2012 F. Bruce Abel

Having lost $11,000 in my trading account in 2011, I feel like a new year gives a blank sheet with ample room for New Year's Resolutions.  As in the past I am reluctant to mess it up.  So far my positions are hedged to some or all extent.  So the daily change in value is small.  Plus, being in Manila so long, I am not at all as rabid about following CNBC in live time as this was impossible due to the time difference.  This is to the good. 

This will be the beginning of my third year of "recent trading" I believe.  I re-opened a Schwab account January, 2009, and I began again after the professional traders/investment managers proved incompetent in the crash of 2008-09.

Lots of action each year with no net profits, with one year at break-even and one year of down $13,000.  In addition to the loss in 2011 mentioned above.

Nevertheless I do not feel badly, (I also have a growing law practice), considering the difficulties everyone has been having with the market.  Yes, a strategy of following Cramer through the whole thing would have recouped from the "losses of 2008-2009," but I didn't have any losses in 2008-2009 as I was not in the market.  My wife, however, was, and her advisors suffered along with the general market with her investments.

My trading account varied from $25,000 (first year) to $50,000, with withdrawals as a safeguard from time to time.

More and more of my trading has been "hedged," using paired trades.  And less of the spur-of-the-moment variety. 

Friday, January 6, 2012

Confessions of a Pattern Day-Trader -- Manila Trading

(c) 2012 F. Bruce Abel

My readers will have noticed that I have not posted, really, for some time.  However, having spent the last six weeks in Manila with daughter Genevieve, and having daughter Becca and her family in Barcelona, I have some peculiar insights into the difficulties and peculiarities of trading when it is day in New York but night in Manila.  Also I joined a start-up investment club in Manila with some highly-educated ADB personnel. Two of which are a husband and wife combination who play at the same level of duplicate bridge that Eunie and I play, and who got us into a delightful game on a Saturday. So most of my posts will be devoted to these circumstantial oddities, for a while.