Vacation Time

Today was the start of the long weekend, and I took today off just so I can trade options all day. Yyeah, I know its crazy, but I guess I really enjoying doing it.

Anyway, the market hasn't been too volatile, and Bernake's speech along with Bush's speech has calmed the markets.

I've taken two large positions on the S&P500 and Nasdaq Index, betting they will do better in next two months. I expect the Fed Rate will be cut by 25bps, which will propel the market back to its mid-summer highs.

Market Changes

On Monday, the Nasdaq started dropping and I sold my September calls for a 105% profit. Then, later in the day, I started buying up October options. As the market continued to dip, I bought more October options today. The hope is that this downward trend will not continue for long

Nearing the end of the month...

And it appears I've going over my budget again. I'm not sure what the issue is. I keep trying to readjust my budget, and I keep being just a little over it. Maybe the trick is to set my budget low so that when I go a little over it, it's actually not too much over?

Aggregating across the last four months, I am about $400 over my budget. Is my saving rate of 10% unrealistic? Should I be spending more/less? Does the 10% even mean anything if that's what I budget for, but I'm always over budget every month?

Nasdaq continues upward

The tech index keeps going up, and my options are already in the money. With 30 days left, I forsee it doubling.

This week is going to be my final week of testing the trading platform of my new brokerage. Starting next week, I will be betting more than $400 at a time.

Second Trade

Thursday, I discovered that my brokerage had a mobile trading platform, so that I could keep track of my portfolio at work on my cell phone. Man, that totally helped my day, as I was checking it in between projects, or when I had a brief moment between conference calls.

Now Thursday saw a crazy day for the Nasdaq, as it started the day dropping, and it looked like everything was going into crisis mode. Unfortunately for me, I bought 2 call options on QQQQ, the Nasdaq index ETF, in the morning at $0.90 a contract and saw it drop all morning. By lunch time, I was very worried, but also saw a huge opportunity to lower my cost basis, as the contracts were down to $0.64. I purchased 3 call options at that price, which gave me an average cost basis of $0.80 a contract.

Now, I bought in because I believed Nasdaq will go up by next month, since I didn't think this subprime mess was more than just fearful investors betting on emotions. So come Friday morning, at about 8:10AM, and I was screaming for joy.

I had CNBC on, and they had just announced that the Fed had cut discount window rates by 50 basis points. This immediately caused stock market index futures to spike up across the board, and I knew my contracts were making a profit.

Although the Nadaq see-sawed through-out the day, it ended up, and with my contracts worth $1.13 each. That was easily a $150 profit off of about a $410 investment in a day!

I'm praying the Nikkei does well prior to the market opening, and that I can keep watching the profits roll in.