A hearty welcome to this new financial blog. We have been running this site in Europe for 8 months now and enjoyed much market appreciation. Due to its popularity in Europe (where it is written in Dutch) we have decided to create this version in English as well. Both sites will enter the same trades and have the same performance. This site will basically enable you to track for free a real-money portfolio of stock options. The strategy consists of selling (or writing) 100% cash-covered put options on US stocks. This defensive market approach aims to generate annual profits in the range of 10 to 20 %, regardless of the direction of the market.

Back in December 19th, 2006 we started the portfolio with an initial capital of USD 67.500 (EUR 50.000). The portfolio is currently worth USD 72.125,-. This means a positive return of 10,78 % after 8 months or 17,00 % on annualized terms. We are currently ahead of the Nasdaq, with a return of + 4,94 % and the S&P 500 with a negative return of - 5,73 % for the same period. The portfolio is invested for about 60 %. Our main focus is on biotech stocks, alternative energy stocks and commodity stocks. Current positions in biotech include Acadia Pharma (ACAD), Dendreon (DNDN) and YM Biosciences (YMI). In the alternative energy sector we have exposure in Evergreen Solar (ESLR), Headwaters (HW) and Pacific Ethanol (PEIX). Coeur d’Alene (CDE) is our commodity play. The portfolio, its performance and its history can be downloaded from the left column.

To keep it simple we do not take transaction costs into account. Brokerage fees, especially with online brokers, are cheap. By writing put options on stocks you enter an obligation to buy these stocks at a certain level (strike). In case the stock actually trades below that strike and you are ‘ assigned‘ , you will have to come up with money to buy. The amount that you would need in order to buy the stocks if you were to be assigned (stock price trades below the strike) is ’ blocked’ as a 100% margin on your savings account. That account may yield 4 % or more. We will not take accrued interests into account either.

Unlike other similar sites we do not charge you anything for this service. We hope we can teach you some insights in the world of options and, why not, that you can profit from it. Curious how we will master the markets ? Keep track of us ! Feedback always appreciated !

13:36 Gepost door in Welcome | Permalink | Commentaren (2) | Tags: hw, peix, acad, dndn, ymi, eslr, cde |  Facebook |