Tiblio AI Week 4
What a crazy week! Lots of earnings data, but for this account, two big names beat earnings that caused rather large moves in my positions in XLF and especially XLC.
That big name that beat earnings? That was META. Up 15% on the day. First, starting the week looked pretty bleak. The market sold off and the ETFs followed. But META makes up 22% of XLC and we see what that did to the ETF here sending it right back to the recent highs.
This was such a big move that we were assigned early on one of our put contracts! Which worked out phenomenally well because we kept the premium and experienced the full upside of owning those new shares.
This is something to consider. Early assignment isn’t necessarily a bad thing. It could point to the option holder’s view changing where they no longer want in that position, they expect a reversal and they’re having a hard time getting out, so their only option is to exercise.
Ok, let’s have a look at what Tiblio AI did, keeping in mind it flows with the market, it doesn’t try to predict anything.
Remember from last week, we closed a bunch of positions and were assigned 100 shares of XLC and the expectation was that Tiblio AI would sell some puts on XLF and sell a call option on XLC.
That’s exactly what happened on Monday. We see two put options on XLF and 1 call option on XLC. That’s due to the scaling. To help us flow with the market, Tiblio AI was limited to selling 2 puts on XLF and sold the third one on Tuesday. And notice it sold the third one at the 32 strike, so we were able to spread around those strikes a little bit helping us move with the movement of XLF which dipped in the first part of the week.
On Wednesday, we closed two puts and three calls on XLF! That was on the move down. Following that we sold another call option expiring 5/12.
Finally, on XLC on the run up Thursday, we closed two put options capturing profit and sold one more put option expiring may 12th.
So going into Friday, let’s look at the current open positions.
I have 200 shares of XLC
Only 1 call option, so can sell one more call option
Have sold 3 puts across strikes 57.50, 58 and 58.50
I have 400 shares of XLF
It just closed 3 call options, and sold 1 so there are 2 short calls, it can sell 2 more.
And 4 open puts, that’s likely the max position size
This is how I’ve been trading options for a long time, but even with that experience, Tiblio AI does it better than me.
If you would like your account invested in this same manner, then take a look at Tiblio AI. It will invest up to $10,000 for free.