Well it has been a while since I have had time to update this blog, but that I have still paid close attention to the markets, and am constatnly thinking of ways to profit.

Our XIV position has really taken a hit, but seems to have stabilized here. I'm torn. Normally I'd like to double down, buy more shares, and ride some serious profits to the upside. But I'm hesitant in this situation, because I still think volatility can move higher at any moment, and the fund has taken a serious hit here in the last couple months. We are already invested, so lets just sit back and let things play as they should. Also, I'm not against leaving a fair bit of cash on the sidelines still, as this market still seems directionless. It needs to go lower, but there are some serious forces out there doing everything they can to make sure that doesn't happen.

Commodities have held up, albeit down a little in the last few days. Both our options positions are doing exactly as they should, with both well above our strike price, and time continuing to decay.

Our position in RIMM has also taken a hit, but we knew this company was in trouble. It's just purely a play that the market has punished this company too much. Their technology is still sound, and I'm confident they are no where near throwing in the towell, so we'll hold. However, I am going to go back to the options market to try and lower our entry cost. May as well derive some income from sitting on the position.

New recomendations.

Sell 2 JAN'12 27.50 RIMM CALL for the bid price of 1.65 per contract, which will raise $330 total.

This will limit our upside in RIMM to basically break even, as our entry point will be moved to $27.10 (28.75 - 1.65), and our exit point if the option is exercised will be 27.50 (a total 0.40 gain). But if the stock stays down in its current range of $23, we'll just collect the premium and be able to re-evaluate things in the new year.

Sell 5 JAN'13 160.00 GLD PUTS for the bid price of 14.00 per contract, which will raise $7000 total.

More than a year from now, this should be free monies.

BUY 100 GDXJ shares with a bid of $36.75. This is basically a market bid, as the security is currently trading at $36.76. I expect this will fill as I write this. Yup. Filled at $36.75. This will cost us a total of $3,675.00.

Account Details.
CASH
= 61,570 + 330 + 7,000 - 3,675 = 65,225

SECURITIES
-->XIV -- 2000 * 7.13 = 14,260 [2000@14.75=29,500]
-->RIMM -- 200 * 23.14 = 4,628 [ 200@28.75= 5,750]
-->GDXJ -- 300 * 36.72 = 11,016 [300@34.08=10,225]
-->SLW -- 300 * 41.12 = 12,336 [ 300@33.67=10,100]
= 14,260 + 4,628 + 11,016 + 12,336
= 42,240

Liabilities
--OCT'11 SLV $35 Puts = 30*0.56 = 1,680
--JAN'12 LULU $40 Puts = 20*2.35 = 4,700
--JAN'12 RIMM $27.50 Calls = 2*1.64 = 328
--JAN'13 GLD $160 Puts = 5*14.40 = 7,200
= 1,680 + 4,700 + 328 + 7,200
= $13,908

Total
= 65,225 + 42,240 - 13,908
= $93,557 (-6,443).

We are currently sitting on a 6.4% loss, or a total of 6,443 dollars. Not happy about this, as the fund has been in existence for 5 months now exactly. That's more than 15% on a yearly basis if extrapolated out. Yikes. The XIV position is really hurting the portfolio right now, but it has rebounded from it's lows, and seems to be functioning a litte more along the lines we originaly thought it would as of late. I'm prepared to hold this a little longer and see where it takes us.

The rest is doing fine, with everything doing exactly as it should. This has certainly helped offset the XIV loss, but you're only as good as your weakest link, so we need to live with it. And to be honest, when compared to the DJIA since fund inception, we are basically dead even. Surprising, I know, as nothing we've done is designed to mimick the market, but it is what it is.