Out of Apple

by JDH on February 8, 2020

Last week I described my Apple Experiment; this week I ended the experiment.  You will recall that I bought Apple shares, and sold covered writes against them.  That worked out fine, most of the transactions were profitable, but in the end I decided the risk was not worth the reward.  Yes, making 1% each week is nice, but we live in a world of volatility. Apple traded under $302 and over $324 last week.  That’s a 7% swing in one week.  In other words, my profit of 1% can be destroyed and take 7 weeks to get back.

That’s not a great risk.

So, On February 5, I sold Apple for $321.75.

That worked out fine, since I bought those shares on January 13 I bought those shares for $311.87.

I’ll take it.

What’s up next?

I don’t know.

My assumption is that the stock market will continue to make new highs for the next few months.  Trump’s re-election is now guaranteed.  The economy is booming, unemployment is low, and the Democrats don’t have a candidate to run against him, so with that uncertainty gone, speculators can focus on an up market.

I’m not saying the economy is actually doing well.  Unemployment is low because many people have short term contract jobs, or work in the even more uncertain gig economy (like driving for Uber), but it’s perceived to be doing well, so that’s all that matters.

Gold has paused, by is still looking good, so I’ll continue to focus on gold in the coming weeks.

That’s the update, thanks for reading, more next week.