new IRA opened, ready to hit the slots!

[KTP]

Woo hoo, my optionshouse IRA account is now open and funded with $3000. I just found out that the 100 free trades promotion for new accounts includes options trading as well as stocks! SWEET. This means I can break up the $3000 in to ridiculously small amounts of contracts for different plays that if done at etrade would have bankrupted me on commissions. I will be able to spread the risk out among several companies instead of just 1 or 2.

Currently thinking about:

SDRL
MSFT
CSCO
JASO
FRO
ANW
MRK
VNDA
ORN

I think the shippers like ORN, ANW, and FRO have the best short term potential as they have been beaten down to 52 week (or greater) lows, yet are still profitable and can skyrocket if the economy gets back on level footing. CSCO and MSFT have already started moving up, so may have missed the boat a bit there...might wait on a small pullback. JASO should do better as spring/summer approaches and people start thinking solar again. Merck is not trading where it should be, but no idea how long that will continue before it goes higher. Anyway, that list is a good start.

[bjl584]

I just bought CSCO at $19 a share. They are going to start paying a dividend in January, so they have some upside potential. Mutual funds will be able to start including them in their portfolios come 2011 with the implementation of their dividend, so you may see a rise of several dollars a share (it may go as high as $25 a share) in the near term.

[KTP]

I just bought CSCO at $19 a share. They are going to start paying a dividend in January, so they have some upside potential. Mutual funds will be able to start including them in their portfolios come 2011 with the implementation of their dividend, so you may see a rise of several dollars a share (it may go as high as $25 a share) in the near term.

Wow, you got in at the rock bottom. Good move!

I bought some July 11 Cisco option call $21 contracts at $0.97 when it was trading in the mid $19 and they are already doing quite nice (up about 50%). Seeing that I have 6 months of time value, I may wait on Cisco $23 or so before selling them, which would be a 200% profit (give or take a few %). Leveraging is so risky and fun!

I feel more comforatable with 6 month options on Cisco than I do with actually owning stock in a biotech, although I did buy some Vanda at $8.80.