SplitMaster.com:: Newsletter
Home :: Strategies :: Membership :: Past Results
Author: Mike Celeste Editor: Tony Ponzo April Circulation:

Stat Sheet Week Ending April 11th 2009

ChangesWeeklyYear to Date
Indexes Points Percent PointsPercent
Dow+62.0+0.8%-696.0-7.9%
S&P+14.0+1.7%-47.0-5.2%
NAS+26.0+1.6%+71.0+4.5%

Highlight of this past week: The winning weeks keep coming for both the Indicator Strategy which now sits on a 93% win rate for 2009 and the Momentum Strategy now showing a 250% profit for the year.

In this Issue---
Options---
*******************************
Our Covered Call program is coming along nicely. One of the stocks -ATW- is above the Covered Call strike price, but that is good, too. If we have the stock, this seems to be a win, win situation. Yes, you can earn more if the stock goes above the combined strike price plus the premium paid to us for the option, but mentally we have to be satisfied to get that combined price. We can ask ourselves if we would be happy if we got $20.70 for a stock that is currently selling for $18.50. If the answer is yes, we can't feel bad if the stock runs up to 21 by expiration day. There is also the chance that if a stock is above the strike price now, it might fall back below the strike price by expiration day. In looking for this type of revenue, the best case scenario would be if the stock closed right at the strike price. That way it would not be called away from you and you have basically a 100% profit from the written amount you received for the option. Then, you can write the next month's option, probably for a higher price and receive the same amount of option price. If you really like the stock and want to hold it, you can also buy back the option and then write the next strike price up.

Next week is option expiration week, and that means some very good opportunities are usually available. This is the time when the option prices move the fastest, with corresponding moves in the stock. We've been talking for example about writing options of Calls or Puts naked to make some income. This is the week the time premium dwindles the fastest. So if you think a particular stock is headed higher during this last week of expiration, and you can find a Put strike on that stock that is say 10 points down, selling that Put and pocketing the premium may be a play to consider assuming the Put has some premium left. Let's say it has .30 in it. You would sell the Put naked, pocket the .30 and watch it each day. As long as the stock either does continue up or stays even or drops but not to the strike, the option will lose its premium during this week. When it gets down to .05 or .10 you might choose to buy it back and close the option position. You then get to keep the difference. So if you sold 10 contracts on a certain Put for .30 and you buy it back for .05 you make .25 or $250. If the stock goes as you expect it to and stays well above the strike, you might dicide to just let it go and expire worthless on Friday, expiration day. You then keep the entire .30. Of course if it goes against you, you can still buy it back to close at whatever price to get out of the position and the obligation to buy the stock at that strike. However, if you like the stock and were thinking of buying it, you might just let it get put to you. You are now buying a stock you were thinking of buying anyway, lower than when you were first looking at it. This is a good way to buy a stock for a better price and pocket .30 on top of that. There are a lot of creative moves you can make but whatever you do, when selling an option naked, it has to be watched and decisions have to be made. It is not for the faint of heart, that is for sure, but it can be very rewarding. As we always point out, although this can be a rewarding trade it comes with risks and traders should have a full knowlege and understanding of those risks before making any option trade

 Momentum Plays---
************************************************
Yet another winning week and the profits keep mounting. The strategy is now sitting on top of a 250% profit for the year. We had 5 trades this week with only one loss. A couple of the profits made were small and it took some time to get them but as we always say a profit is a profit. See Past Results This week we had no Earnigs plays and only a couple of W plays so that left us with SR SPY plays to work with. Those have been a bit difficult lately with the way the market has been trading. Members following this strategy know exacty what I am talking about here. But within a week or so the Earnings plays will start back in as the new earnings season gets into full swing. And sooner or later the market will start trading in a way that gives us better SR SPY plays. Don't get me wrong. We are not complaining. Five trades with four wins is certainly nothing to apologize for. But that is what is so great about this Momentum Strategy, most weeks we do better than that.

For those newsletter members who read about the Momentum Strategy with interest may think that this is a complicated, hard to follow day trading strategy with a lot of risks. But for the most part it really is not hard to follow especially after working with it for a couple of weeks. We take a conservative approach in cutting losses swiftly as to avoid big losses that could wipe out a lot of good work. That approach coupled with the fact that we are still winning over 80% of the plays year to date, is the reason we have a 250% profit for the year. We don't work on a home run or grand slam strategy. Instead we take the conservative approach at making a lot of base hits that collectively wind up being home runs at the end of each month and a grand slam for the year. And on top of that, it usually takes less than two and a half hours a day to follow the strategy.

The staff at SplitMaster was discussing this week the fact that this strategy is perfect for the stay at home spouse who likes the stock market and would like to make extra income in the first two or three hours of each week day. Or it would be great for the retired person who likes to dabble in trading. Or the person who has a job that starts later in the day. If you fall in one of these categories why not give this strategy a trial? We offer a full 30 day money back guarantee and give an extra free week with your initial subscription. So you have nothing to lose in checking it out. Learn More.

Indicators---
****************************
This program is winning at the highest percent rate of any of our programs. The 93% win rate says it all, even tho we don't get as many plays as in our other Day Trading strategies. Strangely enough, it is also our lowest cost subscription. We think that is a great deal. If you want to take a look at how it works in real time, we have an offer that can cost you nothing if you decide it is not for you. We had a winning play this past week, making our record 26 wins and 2 losses for the year 2009. Coming right up is another play scheduled for Monday, 4/13. Is the 13th going to be good or bad to us---why don't you find out.? Team members can already go to our site and see the strategy planned for Monday's play. Learn More

Feedback---
***********************************
Besides presenting our strategies and posting results for each and every one of our plays, we stress service here at SplitMaster. We welcome questions and comments and through this we all learn. No one can ever know too much, not only about investing, but about life. Here is a comment from one of our team members that shows what we are talking about.

"Again, great job and thanks for the quick reply--Bill"

Bill gave us 2 very nice compliments and we want to thank him for them. By telling us that he thinks our strategy is good and also that he appreciates our quick reply to his question, we feel we are on the right track. It is our goal to answer all questions within 24 hours (usually in a much shorter time). Never hesitate to ask. And you know what? That applies to non-members also. After all, we are an educational service---and that works both ways--for us as well as for those asking the question.

We are also getting good feedback from other members who are making profitable trades even tho we, here at SplitMaster, have missed some by not acting quickly enough when target ranges have been hit. Good for you, team---

And now, a very proud announcement. For those of you that have been readers for some time, you might remember Jonathan. He was the high school student that studied with us on a one-on-one basis, at the request of his father. Jonathan is like a sponge, soaking up knowledge as fast as it is thrown at him. He studied our programs, started paper trading, and when his parents provided a $16,000 bankroll, he ran it up to $80,000 in one year, plus paying in full for a Rover--in preparation for him entering the University of Southern California. He is now finishing his 3rd year there, and already has almost enough credits to graduate. Apparently he has been showing this same drive to his professors. Because of recommendations, Jonathan has been invited to be one of the select few chosen for a special program at SC that will result in, per their letter to him---" A rigorous transition period will commence in April. This time will prepare you to hit the ground running and assume fund management responsibilities as of April 1, 2009". Just imagine--he will be trained to manage a fund. And you know what else? I have no doubt that he will be one of the leaders in that small group, and when he graduates, he will do very, very well. Well done, Jonathan, and big congratulations, too, to his parents, who have believed in him and supported his desire to learn. I have to say that this is not a big surprise to me. My expectations are very high for him--as the saying goes, the sky is the limit.


The Economy, The Markets & Commentary---
*************************************************
We keep saying that you don't fight the tape, or nowadays, the momentum. The pendulum is swinging and right how it is swinging higher and higher to the plus side of the investment scale. The major indexes are up for the 5th straight week. Despite all the criticism of the financial plans put out, there are more buyers than sellers, and that is what makes the market move---2 opposite sides, each believing the other side is wrong. When you fight against momentum, prepare to lose. Eventually that pendulum swings too far and will come back, but in the meantime, go with the flow. Wells Fargo turned in outstanding earnings projections for the recent quarter and that sparked a big rally on Friday. Even so, there is some question about the credibility of the earnings and debate about whether an earnings increase can be sustained. Because we still don't have enough details about the bail out plan, the stimulus plan, and toxic assets, there is still hesitancy about the outlook. Can we extend the rally for a 6th straight week? If so, it won't be a record, but it will be nice to see. Back in 2007 we saw the Dow go up for 7 straight weeks. It it has done it before, it can be done again--and maybe exceeded. Personally, I think the market is overbought, especially because of the quickness of the move. Some of the old-time traders warned that when the market turned around it would go up very quickly--and it has. In the meantime, we continue to jump in the market by day trading, looking for quick moves, either up or down. That way we don't fight the strong upward trend. Nothing moves straight up forever, and by using certain criteria, we hope to catch the crest and valleys of some of these moves. Negative news is being ignored, mostly, and at some point it will not be ignored. However, for the moment, the market trend is one way, on a net basis, and we will not fight it. Future problems we have aplenty, but for now, enjoy.

 Today's Thought---
*****************
I want my children to have all the things I couldn't afford.........Then I want to move in with them...............Phyllis Diller


Mike

Published by Splitmaster.com, LLC.
P.O. Box 960 San Dimas CA 91773
Copyright © 2006 All Rights Reserved.
Privacy Policy

To unsubscribe from our newsletter or edit your delivery address go to our Newsletter Page. To edit membership information login to the Splitmaster.com members page. For inquiries regarding this or any other Splitmaster.com Information Delivery System publication contact us at staff@splitmaster.com.