4 Responses to Sold EXPE, Bought SMH & Sold 10 Contracts

  1. Eric says:

    I’m curious, does your ETF-Cashinator screen-scrapes the data it uses or do you have some other source for the options data?

  2. Chris says:

    Hey Rich,

    I’m giving your idea of ETF covered calls a try. What I like about the ETF approach is it’s basically a mutual fund that trades like a stock which allows you in the case of GDX to write covered calls a month out or more. As a start, I’m going with the GDX 40$ and 41 Jan 07 calls since I bought 200 shares at different points. This would yield about $320 on a 8k investment in a month. Very interested in seeing how this works out. :) Thanks for the idea as I was doing this on volatile stocks and was not working out the way I had planned.

    –Chris

  3. RichSlick says:

    Good luck Chris,

    On GDX, be careful on Fed Meeting days as a rise or decline in interest rates will send Gold moving wildly! You can get the FED Calendar at http://www.federalreserve.gov/FOMC/

    I primarily use this approach because, like you said, you’re investing long term like a mutual fund yet you can squeeze (and pocket) cash from your investments on a regular basis.

    As you can see, SMH is now down about $0.75 from where I bought it but I’m not sweating it. If I don’t get called, I can sell February or May calls for more profit and if I do get called I’ll make almost 5% in 42 day period then move on to the next opportunity.

    Best of luck!

  4. Pingback: ETF vs. Mutual Fund (Round 2) » Get Rich Slick

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