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I spent a good part of the day in a medical facilty and its waiting room today. and I'm not quite certain how to describe the fare that was playing on the communal, but grossly undersized overhead television.
Obviously I'm spoiled by both content and context.
It certainly wasn't what I was used to watching during the day, as local news production values leave much to be desired.
Unless I'm mistaken or still in some drug induced recovery mode, I think that one of the correspondents adorned in a plaid blazer was named Herb Grunberg and he was accompanied by Brian Mulligan and Candy Drury.
Other than perhaps being a bit more hirsute and much less intelligible, I guess I could learn to like them, if I was destined to spend the rest of my life in a Bizarro universe.
But my stay here was to be a short one. Sugar Momma made me promise, though, not to divulge why I was here, but I am at liberty to disclose that my efforts to perfect an Erectile Dysfunction drug that allowed you to wait 8 hours before seeking urgent medical attention went awry.
Seems that the calculation should take into account the amount of time that it takes to get to the facility.
But despite the utter boredom of the day, it was a welcome change from what is typically "Winsome Wednesday" which for me represents the low point of the week in terms of trading activity and meaningfully relevant news stories.
Lest you think that I don't know the meaning of the word "winsome," let its use just be refelctive of the fact that I was too lazy and unimaginative today to come up with some other word for alliterative purposes.
Yet, when looking for a change of pace, maybe boring Wednesdays are my definition of "winsome."
I knew that going into the day that it was unlikely that I'd be doing very much, unless there were some really major moves in either direction. This being 2012, the chances of that happening seemed to be fairly small, but in a positive sign, the S&P Volatility Index was positive again, as that must mean something.
The kind of moves that I was thinking of were similar to those seen in the temperatures around the Washington, DC area over the past couple of days.
To me, there's no doubt that a "Weather Volatility Index" would be an eminently investable product and definitely more easy to comprehend.
Whereas there will always be weather, according to Credit Suisse, it cannot be assured that there will always be value to its beleagured volatility index, TVIX.
It's somewhat sad when you can predict with a high level of certainty that a particular day will be uneventful, even though I'm not exactly a thrill seeker by nature.
What's even more sad is that I'm waiting for the after hours earnings release for one of my favorites, Mosaic. The very same company that received universal adulation regarding its likely share performance in the wake of its upcoming earnings report, as measured by the spike in its call volume.
I had sold the weekly $57.50 calls of the shares that I purchased on Monday that re-established the position that I had lost to assignment at $57.50, despite the fact that my new cost basis was now $58.10. Even if called, that would represent a 1.5% weekly ROI, but I wasn't expecting these shares to be assigned..
Instead, with all of that good cheer, I expected quite the opposite, as it has joined the market the past two days and already reversed course.
I did realize, however, watching my shares of Freeport McMoRan take a massive hit today, that there are many ways to hedge. Unfortunately, this week, I wasn't exercising any of those ways.
But the experts. How do they do it? How do they hedge these volatile positions?
Simple. It starts with counting on non-existent short term memories.
For example, on successive evenings on CNBC's show "Fast Money" I found that it's possible to be alternately bullish on Freeport's shares, citing the fact that selling on gold related fears were well overblown, with the next day's bearish sentiment that the company had massive exposure to gold.
There's that word "massive" again.
Today, the over-exposure camp was victorious, as gold took another large hit.
One way or another, you're a winner on that one, almost like betting both "Red and Black."
Of course, I'm really not one to talk, unless you're referring to talking out of both sides of your mouth, in which case I have lots to say.
I'm currently long in positions of the iShares Silver ETF, ProShares UltraShort Silver ETF and have sold puts on both, while also having sold calls on the ProShares UltraShort Silver.
Sort of like "Sybil," of precious metals.
And all while I'm just chomping at the bit to sell calls on the iShares. That should cover all possibilities, except for the one disastrous scenario, which would be no movement at all.
But I'm just exhausted even writing all of that down, but it's really all the same. On any given day, I can't help but win, as long as you conveniently overlook the opportunity costs.
Opportunity costs represent the house's take. Think of it as the green on that roulette wheel.
As it would turn out, I did do nothing all day, besides constantly checking delayed prices on my trusty little smart phone as I occasionally glanced and listened to the news regarding the projected crab catch for this coming season.
And once again, it was those ProShares UltraShort Silver ETF shares and the Barclays Volatility Index ETN shares that offered performance that outperformed the market.
Small consolation as they were the same vehicles that have still lead me to underperform for the year, but still, a small measure of justice.
As Winsome Wednesday comes to its end and we're having a week that is reminiscent of 2011, I'm looking forward to some real joy, as hopefully things start hopping again and the excitement returns.
I don't think that I could really stand looking at Herb Grunberg every day in a world of banality. I need a return to the good life, which ironically enough includes that record crab catch.
Now that's hedging.
|Recent Trades||Security||Type||Action||Type||March 27, 2012||DOW||Call||STO *||Monthly|
|March 27, 2012||DOW||STock||Buy|
|March 26, 2012||GMCR||Call||STO||Weekly|
|March 26, 2012||ZSL||Put||STO||Monthly|
|March 26, 2012||MOS||Call||STO||Weekly|
|March 26, 2012||MOS||Stock||Buy|
|March 26, 2012||XLE||Call||STO||Weekly|
|March 26, 2012||XLE||Stock||Buy|
|March 26, 2012||HAL||Put||STO||Weekly|
|March 26, 2012||BP||Call||STO||Weekly|
|March 24, 2012||CHK||Call||Expired||Weekly|
|March 24, 2012||FCX||Call||Expired||Crumbs|
|March 24, 2012||GMCR||Call||Expired||Weekly|
|March 24, 2012||MCP||Put||Expired||Weekly|
|March 24, 2012||MS||Put||Expired||Weekly|
|March 24, 2012||SLV||Put||Expired||Weekly|
|March 24, 2012||VXX||Call||Expired||Weekly|
|March 24, 2012||BP||Put||Assigned||Weekly|
|March 24, 2012||MCP||Call||Assigned||Weekly|
|March 24, 2012||MOS||Call||Assigned||Weekly|
|March 24, 2012||MS||Call||Assigned||Weekly|
|March 24, 2012||VXX||Put||Assigned||Weekly|
|March 23, 2012||ZSL||Put||STO||Monthly|
|March 23, 2012||FCX||Call||STO||Crumbs|
|March 22, 2012||ZSL||Call||STO||Weekly|
|March 21, 2012||GMCR||Call||STO||Weekly|
|March 20, 2012||MS||Put||STO||Weekly|
|March 20, 2012||ZSL||Call||STO||Monthly|
|March 20, 2012||MCP||Put||STO||Weekly|
|March 20, 2012||BP||Put||STO||Weekly|
|March 20, 2012||SLV||Put||STO||Weekly|
|March 19, 2012||VXX||Call||BTC||Weekly|
|March 19, 2012||CVC||Call||STO||Monthly|
|March 19, 2012||MOS||Call||STO||Weekly|
|March 19, 2012||MOS||Stock||Added|
|March 19, 2012||MS||Call||STO||Weekly|
|March 19, 2012||KSS||Call||STO||Monthly|
|March 19, 2012||KSS||Stock||Buy|
|March 19, 2012||KSS||Put||STO||Monthly|
|March 19, 2012||VXX||Put||STO||Weekly|
|March 19, 2012||VXX||Call||STO||Weekly|
|March 19, 2012||VXX||Stock||Buy|
|March 19, 2012||MCP||Call||STO||Weekly|
|March 19, 2012||CHK||Call||STO||Weekly|
|March 19, 2012||ZSL||Put||STO||Monthly|
|March 19, 2012||AFL||Call||STO||Monthly|