Wednesday, April 2, 2008

A Better Day

Finally, an upswing. After a depressing 4 days, watching with fear as my investments just seemed to dry up, I'm seeing some positive numbers again. First Majestic (TSX:FR), the silver mining company that was my first buy in the stock world, has been pummelled ever since the announcement of a new private placement. I bought initially for $5.10, and doubled my position at $4.67. Yesterday, it had closed down to $4.20. At that price, I was considering buying even more of it, but hesitated since it would have all been on margin, and I wasn't comfortable with that. It's bounced a little today, and I remain confident in the company. Its behaviour the past week seems to be following the price of silver and other commodities, which I think is unreasonable, as their production has been climbing so quickly.

Other news - I made my first dabbling into options. It had been my intention when I bought BMO shares to use them to bring in a bit of extra cash by selling covered calls on them at prices that would see a profit. My break-even point on BMO is $46.95, so today, when it was trading in the high $47 range, I decided to sell some July calls with a strike price of $52. After commision, it netted me $125. So, worst case scenario is that they get exercised, and I turn a 13.4% profit in less than 3 months, more if I get my case scenario, of course, is that the price holds a little under $52 until they expire, and I get extra money for nothing.

So, currently, I'm down roughly $100 since I started trading. While I'm hardly pleased with that result, I am learning quick, and have high hopes.

No comments: