Thursday, March 31, 2011

Bought ES

Bought ES at $5.93

Wednesday, March 30, 2011

Sold MAXY, bought ROIC

Bought ROIC for $10.88
Sold MAXY for $5.10

Remember, MAXY spun off CDXS, which I sold.

Tuesday, March 29, 2011

Bought FNF

Bought FNF at $13.79

Bought GKK, Bought BPI

Bought GKK for $4.43
Bought BPI for $16.95

Tuesday, March 22, 2011

Risk vs. volatility

I consider "risk" to be the possibility of losing capital. Volatility is fluctuation in value. Risk should be avoided; volatility can bring opportunities.

Bought HEK calls

Bought HEK Sep 17 $2.50 calls for $3.83. The stock is currently trading for $6.28. If exercised, these calls would make HEK 4% of my portfolio at a net buy price of $6.33. The net buy price is about the same as it would be if I bought it now, but my investing has a more defensive posture right now and this strategy reduces my risk exposure. That is, is HEK drops to zero I will have lost "only" $3.83 per share rather than $6.28.

Friday, March 18, 2011


Sold PCL for $42.50
Sold BBL for $74.39
Sold DGS for 49.83

Thursday, March 17, 2011

Sold SH

Sold SH for $42.97.

Wednesday, March 16, 2011

Bought SH

Bought SH at $43.27

Monday, March 14, 2011

Bought BBL

Bought BBL for $73.70.

Friday, March 11, 2011

Closed KCI calls

Sold-to-close my Jan2012 $30 calls on KCI for $21.40 per share.

Thursday, March 10, 2011

Hedging with a put spread on IWM

I bought Aug3011 $81 strike puts on IWM for $5.81, then sold twice as many Aug2011 $72 puts on IWM for $2.93. That is, I bought the right to sell IWM for $81, and sold my promise to buy twice as much IWM for $72. The two dollar amounts cancel one another; this position was started as a hedge against a drop in IWM.

IWM is the Russell 2000 index. It was at $82 when I made this trade.

So, if IWM declines $10 per share (12%) I will be obliged to buy it at $72. At that point, the $81 puts I bought will be profitable.

If IWM rises above $81, the puts I bought will be worthless--but they would cost me nothing because the purchase of the $81 puts for $5.81 would be covered by the puts I sold for $5.86 (2 * $2.93).

If IWM ends between $81 and $72, the puts I sold will expire unexercised. The puts I bought will have a value which will vary according to the market price.

Keep in mind that I'm on the hook to buy IWM at $72. I initiated this position only because I'm willing to own this amount of IWM at this price. The purchase would also be subsidized by the value of the $81 puts I bought (if IWM drops enough that the $72 puts are exercised by the buyer, I will be able to sell half as many shares at $81 due to the puts I bought).

Tuesday, March 8, 2011


Sold ROC for $47.51
Sold TRAD for $7.18
Sold CRL for $38.36


Sold TQQQ for $84.00

Monday, March 7, 2011

Bought TQQQ

Bought TQQQ at $82.85. I will probably be out of it by tomorrow's close.

Sold PCBC, Sold MSFT

Sold PCBC for $29.81
Sold MSFT for $25.92

Sold KRE

Sold KRE for $26.59. If it drops a few dollars, I may write puts again for income.

Wednesday, March 2, 2011

Bought more SCPZF

Bought SCPZF at $5.66

Bought CRL

Bought CRL at $36.76