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Old 03-06-2016, 10:58 AM   #1001
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I am happy to report that my portfolio is now UP year-to-date after the big run-up last week. The portfolio has varied from about 60% to 75% equities with about half in foreign equities this year. Right now the portfolio is about 64% equities.
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Old 03-11-2016, 11:36 AM   #1002
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It looks like the S&P500 might actually close at its highest price of 2016 later today (but not higher than 12/31/2015).

It is also a Friday and next week the FOMC will have a meeting and a press conference.

I'm thinking of selling some S&P500 index fund shares later today and will update if I submit an order.

Update: Submitted an exchange from VFIAX (S&P500 index) to VBTLX (bonds).
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Old 03-11-2016, 01:04 PM   #1003
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I think there will be a rate hike in June. Not sure how the market is going to react.


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Old 03-12-2016, 02:24 AM   #1004
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Fed-Up is a very appropriate name for discussing rate rises.

Where was Feddown when we needed her?
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Old 03-12-2016, 09:41 AM   #1005
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I see that you came here in 2014. Feddown had been quite active before that, but she is getting tired. Fedup now takes her place.

Back on market timing, if the market holds up, my put options will expire worthless in a month, and I keep the premium. Not much money there for just a lark, but at 0.25% of portfolio, this gain is already 1/3 of my annual expenses up to that expiry.

I now wish I were more aggressive in doing this.
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Old 03-12-2016, 02:12 PM   #1006
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I telegraphed the fed move a whole year ahead and you still complaining. Lol!


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Old 03-13-2016, 03:42 PM   #1007
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I reviewed the portfolio today and decided to continue de-risking and sell more equities. I want to move from about 63% equities down to 59% to 60% before the FOMC meeting this week.

I will sell VV (large-cap US) on Monday at some point with the decision based on the movement of the market. I will decide the time based on the movement of overseas markets and what happens in US markets. I intend to use the cash to buy VTI (total US) on Tuesday.

You may ask "Why do that since it doesn't reduce US equities for you?" The answer has to do with some other trades that I intend to make this week.

So then you may ask, "Why tell us all this now?" The answer is that if I post here, then I have a 100% chance of following through. If I don't post here, I might change my mind, so this is just to make sure that I don't change my mind.
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Old 03-13-2016, 10:22 PM   #1008
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It looks like the S&P500 might actually close at its highest price of 2016 later today (but not higher than 12/31/2015).....
I wonder if NYEXPAT ever closed out that short position on the S&P500... I hope so.
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Old 03-14-2016, 09:57 AM   #1009
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My limit orders to sell VV have all executed. I sold in three tranches because I like to fool myself that at least I got one good price out of the 3 times I sold.
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Old 03-14-2016, 10:44 AM   #1010
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I've been considering options trading does anyone have a suggestion for a quick-start primer on it? I've been an index fund investor for the most part so this will be starting from scratch.
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Old 03-14-2016, 11:14 AM   #1011
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I've been considering options trading does anyone have a suggestion for a quick-start primer on it? I've been an index fund investor for the most part so this will be starting from scratch.
It is really simple. 1 call option contract represents the ability to buy 100 shares of a stock at a certain price, called the strike with an expiration on the "option" to buy this stock. Similarly, 1 put option contract represents the ability to sell 100 shares of a stock at a certain price, also called the strike, with an expiration on the "option" to sell that stock.

A brokerage house will usually charge you based on the number of contracts you buy. Typically 1 to 5 contracts is under $10.

You can also sell cash secured puts, meaning you offer to buy XYZ corp for $100 (the strike) until June 2016 (the expiration) and for this you are paid perhaps $300 per contract if XYZ corp is trading around $100. You would need to have the ability to come up with $10,000 though if you are assigned the shares in XYZ corp (100 shares x $100 you have to pay per share)

That is about it. Pick your number and spin the wheel is the rest of it.
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Old 03-14-2016, 11:43 AM   #1012
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What? You have not talked about strategies like Strangle, Straddle, Iron Condor, Butterfly, etc...

Just kidding. One can read about these here, 10 Options Strategies To Know | Investopedia, but I found the simple calls and puts tough enough to execute right to make money.

I like to add that what Fermion described above is buying calls when you expect the stock to go up. But if you already have the stock but do not think it will go up to a certain level, you can sell somebody the call option to buy it from you at a higher-than-current price in the future and pocket some premium. The latter is call "writing covered calls", and it can bring you extra "dividends", although at the cost of losing out if your stock turns out to be a winner and shoots up high (it limits your gain).

Also Fermion talked about selling cash-secured puts when you don't mind owning a certain stock at a price even lower than the current. But if you own the stock and want to protect yourself if the stock drops, you buy the put option to sell it at a certain price. It is the same as buying fire insurance for your home, and people do this with their stock when they are afraid that it will drop, but cannot sell it yet due to a certain restriction.

The selling cash-secured put was what I used to make about 4% in 3 months (as talked about on post #1005), on some cash that I keep on hand but do not yet want to commit to market. This is the cash I would drop into the market if pandemonium hits the market, but so far that has not happened.
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Old 03-14-2016, 11:57 AM   #1013
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I've been considering options trading does anyone have a suggestion for a quick-start primer on it? I've been an index fund investor for the most part so this will be starting from scratch.
Be careful to remember 1 option represents 100 shares.
Do small amounts for your first trades in case you lose money like I did.

Selling covered calls is considered the safest as you never lose money (but might miss out on a sudden rise in stock value).
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Old 03-14-2016, 11:57 AM   #1014
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What? You have not talked about strategies like Strangle, Straddle, Iron Condor, Butterfly, etc...
You can learn all about these methods as they are graphically depicted in Game of Thrones.
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Old 03-14-2016, 12:16 PM   #1015
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Here is a typical platform I use at optionshouse. They usually have some sort of sign up bonus if you start an account with $5000 or so (100 free trades, or a free crockpot or something). You can trade 5 contracts for $5, which is an easy way to get your feet wet on some low risk low reward option trading like in SPY.

In this account I started this year with $50,000 and currently am at all cash with $57,600. Not a horrible return for 2016. Most of the trading has been with options and I think I have never had more than $10,000 at risk. I kept a lot in reserve for the big market crash that did not happen. I don't do margin even though this is a margin account (I use the margin account so I don't have to wait on trade settlement quite so much).
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Old 03-14-2016, 12:26 PM   #1016
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The mechanics of placing option orders is easy.

Making money with the option orders that you place is another matter. And as hinted at before, even if you make money (say with covered calls), you probably may have made even more money doing something else with your money.

The first thing though is to get a margin account with authorization to place option orders.
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Old 03-14-2016, 12:30 PM   #1017
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Cool - is the crockpot stainless or ceramic?

Sorry to hijack LOL's thread but I really appreciate the info, thank you! Something I've heard of and even tried to wrap my head around but ultimately didn't put in the effort to try out.

Now back to LOL's regularly scheduled programming...
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Old 03-14-2016, 03:06 PM   #1018
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My limit orders to sell VV have all executed. I sold in three tranches because I like to fool myself that at least I got one good price out of the 3 times I sold.
Sold a 4th tranche here before closing.

I should've waited until near the end of the day to place all the trades as this last trade was very near the high for the day and higher than the closing price.

Now I hope that everything drops tomorrow even more than the expected amounts when these ETFs go ex-dividend.
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Old 03-15-2016, 08:52 AM   #1019
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Purchased VTI with cash from selling VV.

Since US markets opened down about 0.6% at least I didn't lose any extra money over doing nothing.
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Old 03-15-2016, 01:37 PM   #1020
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Since VNQ (REIT index) is up for the day while everything else is down, I decided to sell out of VNQ accumulated over the past year. This is also consistent with my desire to get a reduced allocation to US equities.
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