Investors & Friends:

Here's a summary of our investment actions from the past week.

Option Strategies - Naked Puts

1) Du Pont (NYSE: DD) - Our Jan '14 puts reached 80+% of their maximum value, so we closed them out. The date we opened the trade was 5/17/12.

Option Strategies - Collars

2) Oracle Corp (Nasdaq: ORCL) - We sold our Oracle collars on 1/14/13 @ $31.98 for a 1.0% gain. (A collar is a combination of shares, calls, and puts. Purchasing puts protects against losses. Selling calls helps pay for the puts, but limits profits. It "collars" the gains and losses.)

Return calculation = ($31.98 sale price - $31.65 buy price) / $31.65 buy price x 100% = 1.0%.

The date we opened the trade was 11/23/11.

Option Strategies - Partial Collars

3) Bank of America Corp (NYSE: BAC) - We bought Bank of America shares and protected them with Jan '14 $17 puts. We can sell calls, to complete the collar, at any time before expiration.

The reward-to-risk profile of the investment analysis is as follows.

Bought shares @ -$11.30
Bought $17 puts @ -$5.93
Total debit @ -$17.23

Maximum reward = Unlimited share price appreciation above $17.23, plus quarterly dividends
Maximum loss (risk) = $17 -$17.23 = -$0.23

Adding to our thesis... Meredith Whitney, head of Meredith Whitney Advisory Group LLC, says shares of Bank of America Merrill Lynch will climb to $15 in the next six to nine months. (Source: Bloomberg)

Short Strategies

4) We sold short additional shares of the United States Natural Gas Fund LP (NYSE: UNG) on 1/16 @ $19.24.

Click here for the Investrio Stock Selector Fund Bull and Bear Market Indicators Report for the week ending January 18, 2013.

Click here for upcoming IPOs.

Lead Fund Manager
Investrio