Position Update
| Ares Trading | |||||||
| August 2008 Open Positions Unrealized Profit/Loss | |||||||
| Total Invested: | $873 | ||||||
| Total Return: | $978 | ||||||
| Unrealized Profit: | $105 | ||||||
| Unrealized Profit %: | 12.03% | ||||||
| Total Positions: | 5 | ||||||
| Average Days Held: | |||||||
| Date | Qty | Company | Contract | Strike | Expiration | Price | Cost Basis |
| 7/25/2008 | 1 | DBC | Call | 40 | August 08 | $1.50 | $150 |
| 7/29/2008 | 1 | DBC | Call | 40 | August 08 | $1.20 | $120 |
| Days | Open | Profit % | -20.00% | Profit | ($30) | ||
| 7/25/2008 | 1 | DIA | Put | 113 | August 08 | $2.04 | $204 |
| 7/29/2008 | 1 | DIA | Put | 113 | August 08 | $2.98 | $298 |
| Days | 4 | Profit % | 46.08% | Profit | $94 | ||
| 7/25/2008 | 5 | F | Put | 45 | August 08 | $0.34 | $170 |
| 7/29/2008 | 5 | F | Put | 45 | August 08 | $0.45 | $225 |
| Days | 4 | Profit % | 32.35% | Profit | $55 | ||
| 7/25/2008 | 1 | QQQQ | Call | 44 | August 08 | $1.72 | $172 |
| 7/29/2008 | 1 | QQQQ | Call | 44 | August 08 | $1.88 | $188 |
| Days | 4 | Profit % | 9.30% | Profit | $16 | ||
| 7/25/2008 | 1 | XLF | Call | 20 | August 08 | $1.77 | $177 |
| 7/29/2008 | 1 | XLF | Call | 20 | August 08 | $1.47 | $147 |
| Days | 4 | Profit % | -16.95% | Profit | ($30) | ||
The following positions were closed and will be discussed in order: DIA, F, QQQQ, XLF
DIA: The Dow Jones Industrial Average dropped on Monday, creating 50% profit for the put position. However, the order wasn’t made before the close of the market. On Tuesday morning the contract was sold for 46% profit before the rally started. This was an example of great timing.
F: Monday’s drop in the Dow Jones Average affected Ford’s shares as well. These put contracts were trading at around 40% premium, however the order did not make it before the close of the Monday market session. Similar to the DIA position, these contracts were sold for 32% profit Tuesday morning, before the rally. Another example of great timing.
QQQQ: The Nasdaq index rallied on Tuesday as well, ending up 2.45%. This position was opened at a time when these call contracts were overpriced due to volatility. Thus, even with a dramatic increase in price the contracts only sold for 9% profit.
XLF: This position was sold at the wrong time, an example of BAD timing. The call contracts were down around 40% the day before. Ares Trading played conservatively and cut losses short at 17% in the morning, as XLF began its rally. Ares Trading did not have faith in the upward momentum. As the financial sector rallied with the overall market, the contract increased in value. If these contracts were sold at the end of Tuesday instead of the beginning, they would have sold for $1.86, resulting in 5% profit.
