Conservative option strategies, what did you buy or sell today?

[fenders53]

It's the interest rate creep. Pretty reliable catalyst. I've been adding for weeks and a little early as usual. I am mostly sticking with the ones with actual green operations. Highly likely to see some subsidy advantage in some form.

[vbin]

What UTEs you adding fenders?

Sold $28 T put 03/19 for $29. I have a bunch of T puts expiring today, will be reopening those next week.

[fenders53]

(02-19-2021, 02:31 PM)vbin Wrote: What UTEs you adding fenders?

Sold  $28 T put 03/19 for $29. I have a bunch of T puts expiring today, will be reopening those next week.

I have been scattering the buys around.  Only like 10 shares but there have been a LOT of them, so real money.  You can make an argument most of them aren't dirt cheap yet but many are good enough.  Here is my thesis on the ones I track.  I'll summon Eric for his two cents.  I would trust him to invest my UTE positions for me lol.  I got a few of these ideas from him years ago.    

WEC- looks good here.  They are serious about green.  Good dividend grower and perpetually too expensive.  The market usually gives it love when UTEs are in favor at all.  I have traded it in small quantities for years.  Always too expensive for a real position.  I now have 100 shares and a put sold.  

AEP-Very solid when the industrial economy wakes up.  Getting green.  Downside is Ohio politicians are crooked as a dog's hind leg (like Illinois, and NJ).  They have skirted the trouble so far but it seems like a legitimate concern. They know eyes are on them now.  I have a full position I'd likely trim a bit when it runs.  Cramer brings their charismatic CEO on his show, and Cramer hypes the hell out of AEP when things are good and it helps.  If you believe in the US economy AEP is part of the recovery. 

NEE-The poster child green UTE.  Probably worth $70 but I doubt it happens.  It flies like a tech (not quite) when things are good.

XEL-I am VERY biased.  I am 10X on this stock going back pre-merger.  Not going to make me rich from here but you ever have a company you just trust?  XEL is one of them for me.  My first 100 shares are paid back just in dividends every few years now.  The DGI success story and I only have a few personal examples that patience pays off big.  Well run and cautious enough since a previous CEO about busted them 25 years ago.  They are a great example of gradual and successful green transition the past decades.  They don't give me the impression they are delusional fossil is going away fast in the Northland where they have significant amount of customers.  

XEC- Trying to lose this one since I bought it pandemic low and it's been a good ride.  I've been trying to dump it with covered calls but it won't go away lol.  The monthly income has been good.  Great on a future dip but I wouldn't add here because nuke is the devil to ignorant politicians.  No chance it runs high IMO.  

ALE-A Minnesota UTE I have owned off and on for decades.  They are also going green gradually.  It's pretty volatile for reasons I don't fully understand.  I've made a hobby out of trading the impossible to trade options.  Sometimes I seriously have sold the very few open contracts and it doesn't change for weeks lol.  I own 100 shares, the stock has went nowhere lately and I made over $700 this month.  At least $100 monthly for some time now.  It's a buy in the very low $60s.  It's been easy to flip long shares for a few points but I mostly just keep my shares for the good dividend if you catch a dip. 

DUK- I sell a put whenever it dips.  Maybe 8 times a year and never been exercised even once.  Everybody loves them but they need to get a little greener soon IMO.  I'm not sure I have ever owned more than 25 shares long, but I sell puts EVERY very time it gets at the bottom of it's range.  DUK is not a deal above the high 80's IMO.  You won't lose much money though.

[vbin]

I started decent position in ED today. Thank you for sharing. I have my eyes on WEC, XEL and NEE(nee is not cheap but may be I will start a tiny position). AEP too but after listening to your theory I will wait on it a bit. Rest I will have to revisit @EricL's article on his site.


XEC was a great pick. I missed on this one. Need to look closer.

[fenders53]

If I were starting today I would grab a starter in all four and add to the ones that dip. They are all dividend growers. Revenues have been weak all through Covid. The reason is obvious and not why they are pulling back now. It's interest rates which aren't likely to trend higher than they were when most of these stocks were at least 5% higher. IMO FED won't allow rates to run enough to choke the recovery and the tide likely turns for UTEs. 10 year treasury is the one I watch. Get that above 2% and you can skip the risk of holding most dividend stocks if you only care about income. That's not how I see it but I am not managing a huge fund looking for safe low income for the risk averse. A year from now FED may target sub 1% again and UTEs will head right back to over valued most likely. We love CAP appreciation but if a UTE rises 5% a year and raises the div that's a win over time. I'd go easy on UTEs that run wild with fossil fuel prices. You got that well covered elsewhere. I like it that some of my port doesn't need watched for things out of their control.

[fenders53]

I sold 2/3rds of my remaining T today and sold a few puts at strike 28.50 for .49 prior to next Div. Between dividends T is now 100% about income anyway I can enhance it. If it runs away that's OK. I have this feeling it won't do great in a market correction. I will go after it only when very low even if it means I only have shares a few months a year.

[vbin]

Sold PFE, PCG puts, PLTR.

PEP covered call.

Have EPD, BP puts on order.

Bought a BP leap call.

[fenders53]

(02-22-2021, 12:58 PM)vbin Wrote: Sold PFE, PCG puts, PLTR.

PEP covered call.

Have EPD, BP puts on order.

Bought a BP leap call.

This did not look like a good day at all to sell a PEP call.  Excuse my lecture but did we sell a put in a stock we are not cool with owning for awhile?  I was buying PEP shares today.  Ex div is soon so watch that price action.  It might make your call exercise a day or two before.

[vbin]

(02-22-2021, 04:05 PM)fenders53 Wrote:

(02-22-2021, 12:58 PM)vbin Wrote: Sold PFE, PCG puts, PLTR.

PEP covered call.

Have EPD, BP puts on order.

Bought a BP leap call.

This did not look like a good day at all to sell a PEP call.  Excuse my lecture but did we sell a put in a stock we are not cool with owning for awhile?  I was buying PEP shares today.  Ex div is soon so watch that price action.  It might make your call exercise a day or two before.

My PEP call is out to 03/19. Yes there is a possibility if it runs too much, It can get called. I won't miss it at this price.

[fenders53]

Hopefully PEP is sitting on support now. It will probably struggle in the mid 140s again. I already have a put I have rolled down numerous times. I am glad I sold at 148. I didn't expect a chance to get back in so much lower this fast though. It trades like KO and predictable enough. Without option premiums they underperform SPY.

[vbin]

Anyone has a good hold on Bonds? Thinking to buy some TLT.

[fenders53]

(02-25-2021, 11:14 AM)vbin Wrote: Anyone has a good hold on Bonds? Thinking to buy some TLT.

Nooooooooooooooooooooooooooooo!!!!

Any questions?  

Seriously though too early.  The risk reward is not there.  Not even close.  It's a falling knife as long as the 10YR rises every day.  I sold TLT puts most of last year.  I stopped a few months ago for a reason.  Next stimulus is damn near $2T.  We have finally found the line and the bond market reacted.  It will be a tall task for the FED to keep the 10yr under 2% for long, if they even desire to.  I will type a better description below shortly.