Neutral Nick Update as the Feb Options go off the board

Neutral Nick had some updates as we closed the week out and the Feb options expired.

For wheat he booked a loss of  $1093.75 as his 5 7.80 Feb Puts expired worthless.

For soybeans he had 1300 puts expire worthless; it cost him $23,500

And for corn he was long 6.30 calls, long 6.00 puts, long 6 calls, and short 6.60 calls.  Net his options cost him $13,931.25.

Total between the three grains he is out $38,525.  You will notice that his long positions didn't do the best; the only one with a more then double investment payout was the long 5 6.00 calls; while his other winner on the long side was the long 20 6.30 calls; they barley made enough to pay for commissions, fees, and interest rate as he paid 24 1/2 cents for them; but they expired worth 27 1/4 cents.

The one positive he has going is that overall even after losing nearly 40k in options; he is net up about 80k (assuming he bought back at the close on Friday).  When you cosider most of the grains are at or near thier highs since he started his marketing plan and his hedge account is adding to his net worth (typically cash grain gains are offset via hedge losses if one is hedging)

When he looks at the value if we are unchanged when his positions expire he ends up ahead by around $900,000 which is about $3.00 a bushel on all of his grain. 

The one other thing that Neutral Nick had to do was square his position up; as his delta position has become that of more then 100k  bushels short.

So to Square himself up in wheat he sold 12 8.00 July wheat puts for 86 cents a piece.

He sold 2 14.00 July Soybean calls for 89 cents a piece.

For corn he sold 20 of the July 6.30 puts for 48 cents a piece.

Basically he added the potential that if markets go unchanged until expiration he could add an additional $90,000 to $100,000 to his bottom line via being fortunate enough to have these put options expire worthless. 

If we do continue to rally he will be forced to do more moves like this or run the risk of getting oversold.

Below is the updated table for Neutral Nick's positions.  This doesn't include the mentioned above losses.

Long	# of	Option	Futures	My Trade		Position Equivalent
or Short	Contracts	Symbol	Reference	Date	Price	Delta	Delta (bu)
SHORT	60.00	WN1000C	WN1	23-Dec-2010	49.250	(0.36)	(108,462)
SHORT	25.00	WN700P	WN1	23-Dec-2010	37.875	0.16	20,318
SHORT	10.00	WN900C	WN1	23-Dec-2010	73.500	(0.50)	(24,887)
SHORT	2.00	WN850C	WN1	23-Dec-2010	89.125	(0.58)	(5,765)
SHORT	2.00	WH770P	WH1	5-Jan-2011	27.375	0.23	2,268
SHORT	3.00	WH730C	WH1	7-Jan-2011	68.125	(0.89)	(13,392)
SHORT	2.00	WN900C	WN1	12-Jan-2011	66.625	(0.50)	(4,977)
SHORT	20.00	WH750P	WH1	19-Jan-2011	13.875	0.15	15,091
SHORT	12.00	WN800P	WN1	21-Jan-2011	58.750	0.33	19,737
	136.00					(0.15)	(100,069)
SHORT	5.00	SH1300P	SH1	29-Dec-2010	34.500	0.12	3,028
SHORT	40.00	SN1500C	SN1	23-Dec-2010	82.500	(0.44)	(87,510)
SHORT	50.00	SN1200P	SN1	23-Dec-2010	42.500	0.14	35,200
SHORT	30.00	SN1600C	SN1	23-Dec-2010	62.000	(0.33)	(48,963)
SHORT	2.00	SH1450C	SH1	5-Jan-2011	43.500	(0.38)	(3,764)
SHORT	4.00	SH1300C	SH1	7-Jan-2011	93.875	(0.87)	(17,408)
SHORT	15.00	SH1300P	SH1	12-Jan-2011	13.125	0.12	9,084
SHORT	5.00	SH1360P	SH1	12-Jan-2011	30.500	0.29	7,185
SHORT	2.00	SN1400P	SN1	21-Jan-2011	88.875	0.41	4,137
	153.00					(0.13)	(99,011)
SHORT	6.00	CH680C	CH1	29-Dec-2010	20.000	(0.38)	(11,407)
SHORT	55.00	CN800C	CN1	23-Dec-2010	30.750	(0.31)	(84,526)
SHORT	30.00	CN550P	CN1	23-Dec-2010	37.250	0.17	26,174
SHORT	35.00	CH700C	CH1	23-Dec-2010	16.500	(0.28)	(48,858)
SHORT	2.00	CH680C	CH1	5-Jan-2011	18.500	(0.38)	(3,802)
SHORT	5.00	CH660C	CH1	7-Jan-2011	15.375	(0.50)	(12,504)
SHORT	2.00	CN500P	CN1	7-Jan-2011	20.875	0.09	945
SHORT	20.00	CN630P	CN1	21-Jan-2011	47.875	0.35	35,029
	155.00					(0.13)	(98,950)

Stay tuned to see how Neutral Nick's plan works out for him.  One thing that hs is close to doing is looking at taking profits on some of the sold puts such as the 12.00 July bean puts.  His thinking is he doesn't go broke taking profits.