So far, so good!  Today the ‘basket’ of positions I opened on the 23rd gained another $2,500 of so of value.  As the VIX(23.96 -0.29) continues to plummet and the indexes move further into positive territory move money moves into the account.

Most of the positions are now worthless, so I’m planning to spend a little cash on commissions and then close them out. There are only about two weeks left until expiration and given this volatile market, I’m willing to spend some money to make some secured gains!

Anyhow, I’ll post updates as the positions are closed.  Trade smart!

Well, well, well… That was a pleasant surprise closing in the markets today.

Let me update you on the paper money portfolio.

This morning, right after the opening when things were in the toilet I was filled on all five of my positions. Of course, having a great broker I received price improvement all every last one of these.

Here they are in order of execution:

• Sold 200 Vertical SPY(110.31 -0.52) Feb 2008 122/121 Put @ $0.28
  • Credit $5,600
  • Commissions $(609.95)
  • Margin Hold $20,000
• Sold 200 Vertical QQQQ(45.77 -0.28) Feb 08 40/39 Put @ $0.18
  • Credit $3,600
  • Commissions $(609.95)
  • Margin Hold $20,000
• Sold 200 Vertical DIA(104.74 -0.35) Feb 08 111/110 Put @ $0.22
  • Credit $4,400
  • Commissions $(609.95)
  • Margin Hold $20,000
• Sold 200 Vertical IWM(64.90 -0.25) Feb 08 61/60 Put @ $0.21
  • Credit $4,200
  • Commissions $(609.95)
  • Margin Hold $20,000
• Sold 100 Vertical VIX(23.96 -0.29) Feb4 08 32.5/35 Call @ $0.67
  • Credit $6,700
  • Commissions $(309.95)
  • Margin Hold $25,000

The long and short of it is that I think that fear was at a high this morning, and that the market has hit a short term bottom.

At the close of the market today, I had a paper money unrealized gain of roughly $13,000 on these positions. I plan to keep them around for a while as we hopefully continue up a bit more and then I may exit early to lock in profits in this volatile market.

Please take caution in this market. If you are not comfortable with a trade – do not put it on. It is critical that you understand the risk that you are signing up for, especially in highly volatile markets like this.

Okay… So I think this is the bottom.

Could I be wrong?  Yup… If I am I may blow through about 100K of the paper money account, however I don’t think that is going to happen.  I’m working on a series of positions right now.  They are along a ton of different ‘minis’.

When I get fills on these tomorrow I’ll update the portfolio and describe my thoughts on each of these.  Overall, I think we have hit a temporary bottom and I’m willing to play it.  So here are the tickers:  IWM, DIA, SPY, QQQQ and the VIX.

My orders are as follows:

• Sell 100 VIX Feb 32.5/35 Call Verticals @ $0.45
• Sell 200 DIA Feb 110/100 Put Verticals @ $0.13
• Sell 200 QQQQ Feb 40/39 Put Verticals @ $0.13
• Sell 200 SPY Feb 122/121 Put Verticals @ $0.18
• Sell 200 IWM Feb 61/60 Put Verticals @ $0.14

I’ll post the updates as soon as I get them.  Good luck, hopefully I’m on the right side of this.  If not, it may be quite costly.

Trade smart!