The
Premier Educational Investor Resources
Web
Site!
|
Thank you for reading our newsletter and visiting our web site!
At the top of this web page you see the bottom-line +189.10% results for our model portfolio where we trade our Q's Delta Neutral positions. We have been doing this for more than 10-years without a single losing year. That indicates a great deal and you can do the same as we if you become a subsriber.
The QQQQ ETF LEAPs portfolios is started the first or second week of each calendar new year with the purchase of in-the-money (ITM) QQQQ long LEAPs calls and puts. The LEAPs strike price is chosen by looking at the technical charts to determine the most conservative lower price support and upper price resistance levels for the outgoing year. This QQQQ delta neutral (DN) investment approach attempts to write all (using the entire number of LEAPs contracts you are holding and later buying more LEAPs as you generate income from the writes) of the LEAPs spreads per round. Example, write 10 shorter call spreads against 10 LEAPs CALLs which would provide the maximum downside protection (hedge because you have the income to cushion the drop) if the QQQQ has an extended downward trend.
It is
important to note that we seek out the opportunity (when the market trend or
"conditions" are right) to only write LEAPs spreads on the short
option(s) that will begin to decay using the technical charts or the
QuoteTracker (QT) to ascertain those days or weeks when the signal or
trend is obvious. That means if the QQQQ price is moving upward, we
only write the LEAPs puts spreads. If the QQQQ price is moving
downward, we only write the LEAPs calls spreads. By doing this, we are
assured that the specifically ITM or ATM written short option will
decay (lose value on them not us) on the option buyer(s) of those
options and we get to keep the difference as our income (profit).
Example, we
write (STO) 10 QQQQ LEAPs spreads and collect $1.50 premium
x 10 option contracts = $1,500 total. Three days
later we get a QT signal and we buy (cover) to close (BTC) and say the
decay in QQQQ price now values the written option contracts at $1.00
and not the $1.50 we collected. That means we are able to buy back
those same short QQQQ options at $1.50 - $1.00 = .50 cents less and
keep the $50 profit x 10 contracts = $500 net profit less commission. I
will not factor in because it will vary from person to person. Needless
to say, the more QQQQ LEAPs you own and more you do write spreads
against, the less (percentage wise) the total commission bite and the
greater your returns.