The S & P 500 September contract has had a 60 point high to low within the past 10 days. Since we placed the 1310 -1330 July end of month call spread recommendation on July 21, 2008, the S & P 500 September futures have been from 1261, when we placed the trade, to a high of 1291, to a low of 1231.60, and settled today, July 31th, 2008 at 1266.
On Friday July 18th we stated that "We are looking for the market to possibly continue its rise for another 1% to 2 %. We will look to sell the end of month call spreads on the July contract within the next few days."
The 1310 -1330 July end of month call spread recommendation on July 21, 2008, on the
S & P 500 September futures expired worthless.
We will wait till after the jobs report on Friday, August 1, 2008 to make our next recommendation.
To discuss setting up a monthly S&P Income generating program for you, give us a call
Stephen Zielinski
Mercury Capital Management, LLC
Website http://www.mercury-capital-management.com
There is a risk of loss trading futures and options. Past performance does not necessarily indicate future results. Trade with risk capital only. Commodity trading is not appropriate for all investors. This recommendation is strictly the opinion of its writer and is intended solely for informative purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Futures and options trading involve risk. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. In no event should the content of this market letter be construed as an express or an implied promise, guarantee or implication by or from Mercury Capital Management that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future performance.
Thursday, July 31, 2008
Monday, July 21, 2008
Selling EOM July call spread on S & P 500 futures
On Friday we stated that "We are looking for the market to possibly continue its rise for another 1% to 2 %. We will look to sell the end of month call spreads on the July contract within the next few days."
The market opened higher today, July 21, 2008 and traded up to 1268 but seemed to lose steam, and headed south down to 1255. At the close the market climbed back up around 1261.
We recommend selling the 1310 - 1330 call spread for 1.2 points or $300, less commission and fees. The spread is 4% out of the money, and we feel will not be reached within the next 10 days. Margin on the position is less than $3500 and maximum risk is 18.8 points or $4700 plus commission and fees. (1330 - 1310 = 20 points -1.2 premium collected = 18.8 points.)
We would look to risk $600 on the position. Return on risk would be 6.3% in 10 days if options expire worthless.
To discuss setting up a monthly S&P Income generating program for you, give us a call.
Stephen Zielinski
Mercury Capital Management, LLC
Website http://www.mercury-capital-management.com
There is a risk of loss trading futures and options. Past performance does not necessarily indicate future results. Trade with risk capital only. Commodity trading is not appropriate for all investors. This recommendation is strictly the opinion of its writer and is intended solely for informative purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Futures and options trading involve risk. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. In no event should the content of this market letter be construed as an express or an implied promise, guarantee or implication by or from Mercury Capital Management that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future performance.
The market opened higher today, July 21, 2008 and traded up to 1268 but seemed to lose steam, and headed south down to 1255. At the close the market climbed back up around 1261.
We recommend selling the 1310 - 1330 call spread for 1.2 points or $300, less commission and fees. The spread is 4% out of the money, and we feel will not be reached within the next 10 days. Margin on the position is less than $3500 and maximum risk is 18.8 points or $4700 plus commission and fees. (1330 - 1310 = 20 points -1.2 premium collected = 18.8 points.)
We would look to risk $600 on the position. Return on risk would be 6.3% in 10 days if options expire worthless.
To discuss setting up a monthly S&P Income generating program for you, give us a call.
Stephen Zielinski
Mercury Capital Management, LLC
Website http://www.mercury-capital-management.com
There is a risk of loss trading futures and options. Past performance does not necessarily indicate future results. Trade with risk capital only. Commodity trading is not appropriate for all investors. This recommendation is strictly the opinion of its writer and is intended solely for informative purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Futures and options trading involve risk. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. In no event should the content of this market letter be construed as an express or an implied promise, guarantee or implication by or from Mercury Capital Management that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future performance.
Friday, July 18, 2008
July option expiration on S & P 500 futures
We have had a wild ride the last 3 weeks. Since we placed the 1180-1160 July put spread recommendation on July 1, 2008, the S & P 500 September futures have been from 1261, when we placed the trade, to a high of 1293, to a low of 1201, and settled today, July 18th, 2008 at 1260.
As we had mentioned on July 1, 2008, "Although we might see a further slide in the market, we feel that we will see a rise from the recent low. We believe that the S&P 500 will not drop more than 6 % or below 1180, within the next 23 days."
The 1180-1160 put spread expired worthless today. Value of the put spread when the market was at a low of 1201 was less than our risk parameter of 2.5 times what we have collected in premium.
We are looking for the market to possibly continue its rise for another 1% to 2 %. We will look to sell the end of month call spreads on the July contract within the next few days.
To discuss setting up a monthly S&P Income generating program for you, give us a call
Stephen Zielinski
Mercury Capital Management, LLC
Website http://www.mercury-capital-management.com
There is a risk of loss trading futures and options. Past performance does not necessarily indicate future results. Trade with risk capital only. Commodity trading is not appropriate for all investors. This recommendation is strictly the opinion of its writer and is intended solely for informative purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Futures and options trading involve risk. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. In no event should the content of this market letter be construed as an express or an implied promise, guarantee or implication by or from Mercury Capital Management that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future performance.
As we had mentioned on July 1, 2008, "Although we might see a further slide in the market, we feel that we will see a rise from the recent low. We believe that the S&P 500 will not drop more than 6 % or below 1180, within the next 23 days."
The 1180-1160 put spread expired worthless today. Value of the put spread when the market was at a low of 1201 was less than our risk parameter of 2.5 times what we have collected in premium.
We are looking for the market to possibly continue its rise for another 1% to 2 %. We will look to sell the end of month call spreads on the July contract within the next few days.
To discuss setting up a monthly S&P Income generating program for you, give us a call
Stephen Zielinski
Mercury Capital Management, LLC
Website http://www.mercury-capital-management.com
There is a risk of loss trading futures and options. Past performance does not necessarily indicate future results. Trade with risk capital only. Commodity trading is not appropriate for all investors. This recommendation is strictly the opinion of its writer and is intended solely for informative purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Futures and options trading involve risk. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. In no event should the content of this market letter be construed as an express or an implied promise, guarantee or implication by or from Mercury Capital Management that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future performance.
Tuesday, July 1, 2008
Selling put spreads on S & P 500 Futures
We have seen the major indexes slide from their mid May highs to the current lows. The S&P 500 was trading around 1440 on May 19th, to the recent low today, July 1, 2008 of 1261. This is a drop of over 12% in the past 6 weeks.
We are looking for a short term bottom in the market. Although we might see a further slide in the market, we feel that we will see a rise from the recent low. We believe that the S&P 500 will not drop more than 6 % or below 1180, within the next 23 days. We recommended selling the July 1200 put on the September S&P Index, and buying the 1160 put to limit our risk to collect 2 points for the put spread, $500 less commission and fees.Each point on the S&P is worth $250. Initial Margin on the trade is less than $3500. Maximum risk is the difference between the option sold and the option bought which is 20 points on the put side; (1180 – 1160 = 20) less the points of collected premium; (20 – 2 = 18 x $250 = $4500 plus commission and fees).If the options expire worthless, your return on initial margin is 14% less commission and fees in 23 days. Return on risk is 10% in 20 days. To discuss setting up a monthly S&P Income generating program for you, give us a call Stephen ZielinskiMercury Capital Management, LLCWebsite http://www.mercury-capital-management.comThere is a risk of loss trading futures and options. Past performance does not necessarily indicate future results. Trade with risk capital only. Commodity trading is not appropriate for all investors. This recommendation is strictly the opinion of its writer and is intended solely for informative purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Futures and options trading involve risk. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. In no event should the content of this market letter be construed as an express or an implied promise, guarantee or implication by or from Mercury Capital Management that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future performance.
We are looking for a short term bottom in the market. Although we might see a further slide in the market, we feel that we will see a rise from the recent low. We believe that the S&P 500 will not drop more than 6 % or below 1180, within the next 23 days. We recommended selling the July 1200 put on the September S&P Index, and buying the 1160 put to limit our risk to collect 2 points for the put spread, $500 less commission and fees.Each point on the S&P is worth $250. Initial Margin on the trade is less than $3500. Maximum risk is the difference between the option sold and the option bought which is 20 points on the put side; (1180 – 1160 = 20) less the points of collected premium; (20 – 2 = 18 x $250 = $4500 plus commission and fees).If the options expire worthless, your return on initial margin is 14% less commission and fees in 23 days. Return on risk is 10% in 20 days. To discuss setting up a monthly S&P Income generating program for you, give us a call Stephen ZielinskiMercury Capital Management, LLCWebsite http://www.mercury-capital-management.comThere is a risk of loss trading futures and options. Past performance does not necessarily indicate future results. Trade with risk capital only. Commodity trading is not appropriate for all investors. This recommendation is strictly the opinion of its writer and is intended solely for informative purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Futures and options trading involve risk. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. In no event should the content of this market letter be construed as an express or an implied promise, guarantee or implication by or from Mercury Capital Management that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future performance.
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