Get Rich Slick

Thanks for visiting. This Blog and is intended for individuals with Net Annual Income of $105,000 or more. Get Rich Slow + Get Rich Quick = Get Rich Slick. If you're new here, you may want to subscribe to my RSS feed.

OIH is on fire! A while ago, Mrs. Micah asked, “Do You Have an Investing Exit Strategy” and I couldn’t help but associate that question with my ETF Covered Calls investing strategy. Let’s review a specific journey on a specific investment I recently made.

In December of 2007, I bought 200 shares of OIH at $189.45 and sold 2 contracts for January $190 strikes for $5.00/each to rake in about $1000.00. In January OIH dropped to around $170 and stayed near there through April when it started climbing back into the $180’s.

In April 2008, I sold 2 contracts for May $190 strikes for $5.55/each to rake in about $1100.00. So the total profit for the trades were about $2100 or 5.5% from December through May expiry.

OIH is now hovering around $210 but is now the time to sell? Has OIH had it’s run and will it slide back down or is it just catching its second wind and about to climb to $250?

Look at the graphical diagram (click for larger image).

As you can see from the image, OIH hit a “dry well” for a brief period from January thru April so should you have cut and run or stayed in it for the long haul? This is why I love ETF Covered Calls because you’re partially quasi-long and you’re profiting by selling calls (short). It’s the best of both worlds.  As obvious as it sounds, you make money selling not buying and I’ve sold calls and soon I’ll sell my shares to bank the profits.

As for my current investment, if OIH closes above $190 today (which looks like it will), I’ll be forced to sell my shares at $190 and revert to being in cash in my account. Once in cash, it’ll be time to look for more opportunities and I’m glad. I’m getting the feeling that OIH might have run its course and I’m not willing to re-buy OIH at these levels. Perhaps if OIH drops back down to $170’s I’ll pick it up again. If you find this interesting, check out www.ETFCoveredCalls.com to learn more.

Bookmark to:

Amazing…Logged on to my brokerage account as tomorrow is options expiry and was greeted with the following message:

Options Expiration
The last day to trade equity option contracts expiring on Saturday, May 17th is Friday, May 16th. If you do not have sufficient funds/buying power to cover potential exercises or assignments, please deposit funds or close out your position before close of market on Friday, May 16th. Please be aware that TD AMERITRADE reserves the right to close out any option positions at any time on the final trading day prior to expiration that would pose risk if exercised or assigned. Any equity option that is in-the-money by $0.05 or more at expiration will be automatically exercised. Please note that effective June 21st, this threshold will be lowered to $0.01.

I remember the good old days when options in-the-money by $0.75 would be exercised and now it’s dwindled down to a penny!

I guess this is progress!

Bookmark to:

I’ve written about hoarding food and I decided that I’d might as well reveal that I’ve been hoarding medicine too.   It’s primarily antibiotics which can be obtained overseas fairly easily but I’m also given a set of antis every time I travel internationally in the event of sudden illness.

So why medicine?   There’s no particular shortage of medicine as far as I know and I’m not concerned about the production of pharmaceuticals but I am concerned about the distribution and delivery model of medicines in our current gas guzzling trucker infrastructure.

Like I wrote about before, it’s not too implausible for a hurricane or two to barrel through the gulf of Mexico hitting the US gulf coast and damaging or wiping out a refinery or two which in turn would cause the price of oil/gas to spike into the stratosphere.  It’s during disasters that a peak demand for medicines and other necessities (e.g. food/water)  hit the hardest.

As Murhpy’s law suggests, I’d end up needing medicine when disaster strikes the most and I want to be well prepared.

Food for thought…..

Bookmark to:

Well it happened again, I stopped by the mall and couldn’t help but notice how packed the parking lot was yet few people inside actually shopping.   Too many people hanging around the food court eating ice cream or pretzels.   I could see many of the food shop owners hungry for customers as people were just milling about.

It occurred to me that shopping malls should start charging admittance fees.  I’d honestly prefer this to the shops inside the mall tacking on an “energy fee” to my purchases in the very near future.   Don’t laugh, if energy prices keep climbing, you can expect retail outlets to start squeezing the consumers some how to make up for their additional expenses.

If airlines can tack on a fuel surcharge then why can’t retail outlets tack on an energy fee surcharge on the stuff they sell?   Perhaps the energy fee can be refunded with a purchase of $100 or more at the shops.   Just food for thought….

Bookmark to:

A few friends in the medical field are finding it increasingly difficult to make a living out of the medical profession.  The medical field has a high barrier of entry.  Many doctors are saddled with a great deal of debt after 8+ years of medical school followed by an internship.

Once in actual practice, liability insurance, office expenses and poor payments and delayed reimbursements make it very difficult to earn a profit and run a business.

Contrast this with someone who might study to be a software programmer or network guru who might study for a couple of years at a technical college or perhaps be self-taught for a few years and starting salaries in the 80k, you have to wonder if a person is better off being a “computer doctor” than an actual medical doctor.

The computer doctor isn’t going to have to worry about liability insurance, insurance companies not paying on time or other such nonsense and there is a clear advantage here in favor of the computer doctor.

Food for thought….

Bookmark to:

There’s something that has been troubling me about shopping malls the past couple of weeks.  The parking lots are packed, people are milling about but retail sales are generally down.

I generally don’t see too many people with shopping bags at the mall but I do see a lot of people walking around.  I see families with kids walking about and I can only conclude that the mall is the cool safe haven to be rather than burning your own AC at home.

I encountered the same thing this week as I stopped to shop at three different malls looking for a specific gift for someone this week.   This ultimately doesn’t bode well for the market over the upcoming summer but we’ll have to wait and see what happens.

Bookmark to:

Hurricane seasons is coming up and if one happens to blow through the Gulf of Mexico disrupting shipping, refineries, and production rigs during the summer what do you think the price of oil will hit?  If oil hits $150/bb this summer what will that do to the Dow?

I’m dreaming of dancing dollars and the sweet cha-ching of the register…..

Don’t say you weren’t warned……..

Bookmark to: