Weekly Options Trading Update

Market Beating Options: Portfolio With Biggest Gains Since Inception

The aggressive portfolio experienced a slight gain for the week as it continues a strong upward trend. That trend has propelled our performance gains to a whopping 317% just since January 2007. As we have said before, this portfolio does show a lot more volatility, but we think that risk is worth high returns like those. We just sold our call option position on the S&P Market Index to break even. We decided to sell as the market rose sharply this week. We had less than two months to expiration and grew concerned that the overall market may not continue its advance over the last two months of the year. We do not think we are in for a fall per se, just that the market may not continue to move up fast enough to warrant holding the risk on this position. We decided to sell and at least get our investment back. We have some other options that will expire in two to three months, so we will be watching those carefully to take advantage of selling opportunities. Option price volatility can increase significantly as expiration dates rapidly approach. The challenge with trading options is that investors not only have to get price direction right, but also have to get the timing correct as well otherwise options will expire worthless on expiration day. We are 60% invested and do plan to invest in another call option or two. However, the market is currently trading on the high side of what we believe is a reasonable trading range. In that light, we do not want to be too aggressive in this portfolio so we are not looking to get 100% invested right now. However, if we find a compelling buying opportunity we will invest and assume that risk.

Portfolio Details Available Online At: http://www.marketbeatingstocks.com