Friday, July 27, 2007

Today's New Positions

The new positions established today are using my new criteria of 24% annualized return if called or if not called. Of the 6 new positions, 4 of them were front month calls and 2 were second month calls. I know one reader who will be very pleased with this ;-).

The market sell off this week provided some nice opportunities to buy these stocks below their fair value, as determined by Morningstar. All of these positions were sold ITM, so they could fall a bit more and still get called away at expiration. Even if the market continues to decline and these positions end up OTM, the premiums received will provide a nice return.

I have no idea what the market will do but I don't really care. These are all solid companies purchased at a good price. Although they are short-term positions, I'd be willing to hold them for 2-3 years.