The heart-ache with AAPL continues!!

40% YTD gain. Unbelievable!! The amazing run continues....waiting for pullback!

AAPL seems to be single-handedly keeping the markets alive. The hype on iPad/etc is continuing. It's like tulip mania.

1 percent trade

got into the following trade on last Friday...

 bought 2 GMCR(@69.4) Mar 55 calls for $14.8 [looking for a 5.2 (35%) profit and a stop loss of 1.8(12%); 3/5/2012 will be deadline; So allowing 2 weeks for this to play out]

currently on Tuesday; 11pm EST it's @70.75 ($16.2). So it's going good.

close of the option trade...with a 35% gain!

With the market way overbought and the FAST overbought, it's best not to press your luck :) So decided to get out of this after slight run up in the FAST in the morning today even though market is down lil bit. So closed as follows for a 35% profit in less than 2 weeks ( week and 2 days to be precise).

sold x FAST May 40 calls for 11.7 [11.7-8.7 = 3; 3/8.7 ==> 34.5%]

Of Course, this is not substantial amount as only 1% of my portfolio was deployed. But then, the risk in the trade was also very less exactly for that reason :)

update on the recent [1%] option trade

Looking good after a week. FAST is nearing $50 and look at the graph tells me that this still has legs and is in a nice uptrend! So option price today has also spiked and it's currently @10.2; that's a 17% return in 1 week. So will keep holding the following option...
x FAST May 40 call for 8.7 [3/5/2012 will be the deadline; currently @10.2; +17% in a week]

The heart-ache with AAPL!!

I was in this when the earnings came out although in a hedged kind of position (as follows)

bought x shares for 425
bought x 450 2013 puts for 63

Apple came out with earnings that blew expectations and I immediately got rid of the entire position for some profit as follows:
sold x shares for 452
sold x 450 2013 puts for 52

As you see, made a good profit in one night. But I had this nagging feeling that Apple is going to go higher, way higher. I grappled with what to do that night...should I just get out of Put and let it run. However, had this feeling that it may pullback before going higher.

Now, today Apple is at 487 and it looks like it will test that 500 before pulling back! As expected it did pull back to 440 (but was hoping for it to pull back to 420ish to enter). The graph looked expensive, overbought. Well, if you look at graph now, it's way overbought. There in lies the dilemma!!

However, there was something I should mention...I was reading the latest FORTUNE magzine edition and in it there was an article on Momentum investing. And this top hedge fund guy (forgot the name) was mentioning how when the news comes on Mo stocks, usaually they don't move all the 100% of their move, rather they move 50% of their potential on the news breakout and then over the next few sessions will slowly climb to realise their 100% potential. I read it, but I didn't connect the dots w/ the Apple earnings and move. How true he was!! If only I got in back on this one when it crossed $460. 420-460 was immediate earnings related move and the next 50% move seems to be from 460-500!!

So I'm sure Apple will climb to 500, but just afraid that it's too late to get in at this time, but will wait for it's eventual pullback to test the moving average :(

1 percent trade

going to get my feet wet with the following small option trade:
- Bought x FAST May 40 call for 8.7 [3/5/2012 will be the deadline and hoping for a 80% gain with a 20% stop-loss ]

waiting for that buying opportunity...

I don't see any reason to jump into the market. So going to stick to staying mostly in cash. Staying in VMLTX - the limited term Tax Exempt Mutual Fund - is equivalent to staying in cash for me...

• No blood (oversold conditions) in the market.
• Way overbought when you look at any chart.
• Of course, we may be in overbought territory for a while and miss some opportunities, but that's ok..
• Europe crisis(PIIGS) not resolved yet!