NEWS FLASH: Nothing happened this week in the market. The S&P 500 closed almost flat for the week (and the year). Common sense would seem to dictate little market moving news would occur in a holiday week, and CCI acted on that belief to make a little money to pay for those holiday gifts via put selling.
Trade status below:
Walgreens (Wag) earnings last week were basically a non event (especially related to their battle with Express Scripts) . Subsequently the stock rallied, the volatility rushing out of the Jan options, and time decay worked in our favor. CCI closed the $32 Jan put position for a gain of .68/share (2.1% in two weeks)
Us Steel (X) - Nothing happened with X this week. The slightly out of the money $25 Dec 30 (weekly options) expired worthless and CCI pocketed $.32/share (1.2% in a week)
Emerging markets (EEM) fell a bit and closed just below the $38 Dec 30 strike CCI had aggressively selected. Earlier today CCI was able to roll this option out to next weeks $38 Jan 30 strike. The Dec 30 option made only $.23/share (.6% in a week), but we also know received a $.49share credit ( 1.3%) for next weeks options. Obviously there is about at a 50/50 chance that CCI will get assigned that stock next week. CCI is very comfortable building a position in EEM and this option premium collected will have lowered the effective entry price to $37.28. If the stock rebounds CCi will have pocketed $.72/share (1.9%) in two weeks.
Corning (GLW) - Corning closed trading at $12.98. CCI still holds the Jan $12.50 puts. At this time the position is up about $.12/share or 1%. CCI let this option ride into next week as there is still $.25 (2%) left in the premium.
Seems like realized volatility in the final week of the year might be naturally suppressed, and the mostly mathematically based weekly option market pricing could have a hard time factoring in that dynamic. Hence, CCI will likely be looking to aggressively sell weekly puts again next holiday season.