Closing out trades

Two more winners to close out today; My naked BRK.B puts from October and my naked MSFT puts from the end of November. The market jump this morning has killed most of the remaining value on both these trades. Luckily I get cheap commissions on options from TD Ameritrade. With higher commissions it's not always worth it to close out "zero-risk" trades when they get cheap like this. I know these aren't technically "zero-risk," but since they are both rock-solid companies I don't see any risk to holding the options since they are just an opportunity for me to purchase the stock cheaper than it is now. The only reason I close them out is because it frees up margin for more profitable trades(within the current model portfolio, I have plenty of margin available, but that may not always be the case. It only costs me a few bucks to close them out now and if the stock drops again I can get back in for a better price.

• Buy to Close: 1 BRKB Jan 20 2012 67.5 Put @ $0.09
• Buy to Close: 2 MSFT Jan 21 2011 24.0 Put @ $0.04

I ended up with about a 21% gain in 2 1/2 months on Berkshire and a 12% gain in just a month with Microsoft.

The Numbers

• Cash: -$17
• Short Option: +$17
• Margin: +$1000