Subject: Re: Charts and predictions
I've been running my BRK at leverage = 2 with DITM LEAPs. Is it time to go back to stock and sell covered calls every week?

Well, there are lots of moving pieces. I don't know what else you own or the size of your cash pile, and I probably prefer not to.

But if that leverage was something put on at a time that valuations were unusually good as a way to profit maximally from the upswing, then this is decidedly not such a time, so I guess taking the leverage off makes sense. If it is just the current method you are using to hold upside to a specific number of shares over the long term for whatever reason, the answer might potentially be different. But if I had to guess your situation, taking the leverage off is more likely to be a good idea than a bad one.

Writing covered calls against that is perhaps gilding the lily. It might work and add value, but it's a more aggressive decision. As mentioned in another thread, most people find it hard to watch that lose money (even through their stock is making more money at the same time). So I'd be hesitant to recommend that.

The net of my long and short positions is the smallest net long I've had in a very long time. (though that's hard to calculate, as it depends on how much, if any, of my stock is called away from the calls I've written)

Jim, I am remembering your prediction for the next book value being a leap of 6% from the previous quarter. That is not going to help BRK to "remember" it has to slow down, is it?

Honestly I have little idea how the market will react to the Q2 book figures. Markets can be pretty perverse. It seems pretty certain that book will look good, largely due to the very large increase in the market price of Apple shares in Q2. But yes, in general, the market reacts to current book value more than it does to "on trend" value, both in unusually high and unusually low quarters, so even if Q2 book is "unusually" high, that may not be taken into account.

Jim