June 2013 Results

We’ve had some headwinds in the market these last few weeks – a couple of worries about how fast interest rates had risen, some comments from the Fed about what lays ahead – all of these gave us for straight days of decline.  Those who are inclined to do technical analysis reported that we tested some key areas of support; we could be headed for a bear market, or maybe not.

During the depths of those four days I was second guessing my decision to stay in the market at the 95% level.  Sure enough though, as soon as those thoughts started circling around the old noodle, the market surprised us and we’ve just had three straight days of gains, getting back most of what we’d lost last week.

I think we will see this kind of summer action all the way through Labor Day, so buckle your seat belts.

At the end of it all Rescue My IRA had a good month.  I learned a new tool – unwinding an in-the-money position – and took some capital gains from my GE position early in the month.  I collected some dividends and then turned a profit on call premiums, and made my goal of 1% returns for the month.

Here is a summary of the Rescue My IRA statistics for June 2013, as of the 6/27/2013 market close:

Account Status:

·         Total Account Value, 6/27/2013 Market Close:  $142,516.16 (down from May’s close of $144,085.05, but still up vs. the April close of $142,267.90)

·         Total Cash Reserve, 6/27/2013 Market Close:  $8,351.52

·         Core Stock Positions (as of 6/27/2013):   AFL (200 shares), CAT (100 shares), CMI (100 shares), COP (200 shares), CSCO (500 shares), DVN (200 shares), IP (200 shares), JPM (300 shares), MSFT (400 shares), SPLS (700 shares), TLT (100 shares), TXT (300 shares), WIN (500 shares)

Performance Metrics:

• Option Premiums Collected (net, month of June):  $319.51
• Capital Gains Collected (net, month of June): $1,208.68
• Dividends Collected (recognized on the ex-date): $286.51
• Interest on Cash Reserve (estimated): $0.08
• Total, Absolute Return:  $1,814.78
• Absolute Return, Percentage Basis:  1.47%
• Annualized Return, Percentage Basis:  16.62%

Next Month To-dos:

July is a very light month for dividends; while I am forecasting $244.00 forecast from four positions:  TLT, CAT, CSCO, and JPM.  The CSCO and JPM positions are in-the-money and stand a good chance to be called away early, so my dividends may end up less than $100 for the month.  The stock gains on those positions will more than make up for that – and I may even take the opportunity to unwind some underperformers. 

I have five June contracts:  CSCO and JPM, mentioned above, are in the money, as is MSFT.  My TLT and TXT positions are out of the money – but only barely so, so they could well be called away too when all is said and done.

As I’ve written over the last few months, I decided not to “sell in May and go away,” and I’m staying 95% in until the summer is over…and I am always looking for good bargains.  It looks like I will have some cash freeing up soon to go bargain hunting during the ups and downs that I think we’re going to continue to see.

I was pretty slow to post this month - it has been totally hectic at work, where it is government budgeting season.  We've had some late nights putting together program briefs.  I will try to do better.

So until next month – have a good one.