(7) PUTS AND CALLS OPTIONS AT FAIR VALUE

12 Months Ended

Dec. 31, 2011

Derivatives and Fair Value [Text Block]

(7) PUTS AND CALLS OPTIONS AT FAIR VALUE

At December 31, 2011 and 2010, the Company had open positions of put and call options on various stocks the company is willing to buy or sell.

The following summarizes the Company’s Put and Call Options as of December 31, 2011 and December 31, 2010.

Put and Call Options	Selling price		Fairvalue		Mark to Market Adjustment
December 31, 2011	$	6,954,421	$	7,103,448	$	(149,027)
December 31, 2010	$	9,896,627	$	4,330,069	$	5,566,558

As part of the company’s investment strategy, put and call options are sold on various stocks the company is willing to buy or sell. The premiums received are deferred until such time as they are exercised or expire. In accordance with ASC 815   these options are marked to market for each reporting period using readily available market quotes, and this fair value adjustment is recorded as a gain or loss in the Statement of Operations.

Upon exercise, the value of the premium will adjust the basis of the underlying security bought or sold. Options that expire are recorded as income in the period they expire.

For the year ended December 31, 2011, the Company recorded a loss of $5,715,585 from marking put and call options to market. For the year ended December 31, 2010, the Company recorded a gain of $210,205 from marking put and call options to market.

All proceeds of the put and call options which are equity contracts are shown net of the mark to market adjustment in the current liability section of the balance sheet as Put and call options, at fair value.