Friday, June 29, 2012

Alpha-D Updates for June 2012

This update comes a few days after I executed a few trades in my own portfolio.  There's a pretty good reason for this delay.  I spent much of June in a remote part of Monterey County, California where I had only intermittent access to the Internet and very little free time.  I had just enough time a few days ago to log into my brokerage account and make some trades.  Only now have I had the time to explain my actions.  My critics will just have to deal with it.

My short puts under GDX expired unexercised over June's options expiration weekend, but my covered calls were exercised when GDX rose in price.  I bought back all of my GDX holdings (no net change) and sold more covered calls; I did not sell any more puts.

My covered calls on FXI expired unexercised, so I renewed them for another month.

I still have my long positions in FXA and FXC with covered calls that are set to expire next month.  I also have my short put position under FXF that will expire next month.  Those currency positions are very important parts of my plan to hedge against the devaluation of the U.S. dollar from hyperinflation.  I reserve the right to go long FXF at some point.

My remaining California muni bonds will mature on July 1.  I will not buy any more fixed income instruments denominated in U.S. dollars until the possibility of hyperinflation has passed.  That could be years away, and if the U.S. actually enters hyperinflation the holders of U.S. dollar fixed income securities will wish they had never seen a bond or CD.

I'm sitting in plenty of cash, awaiting the European implosion that will get the economic crisis roaring once more.