LiveRocket Portfolio Update

It's been 2 months since I posted a performance summary. During that time, we've seen the following:

Dividend Payouts received: $112
QID $9
SZK $10
SCC $14
SIJ $9
SRS $44
DUG $16
CF $10

Three Covered Calls (CF, ETFC, & ETFC again)
CF Covered Call Play Total Net: $600
CF 100 shares @ $130 Strike price (cost basis $130.2)
CF Covered Calls 100 @ $6.2 each

ETFC Covered Call Play Total Net: $1,300
ETFC 2000 shares @ $4 Strike Price (cost basis $3.75)
ETFC 2000 Covered calls @$0.40 each

ETFC Covered Call Play Total Net: ($580 loss at current values)
ETFC 1000 shares @ $4 Strike price (cost basis $4.07) – Not exercised
ETFC Covered Calls 1000 @ $0.35

The covered call move has been a net positive. We also have 1000 shares of ETFC at a cost basis of $3.72. I missed an opportunity to write another $4 covered call and bring down that cost basis further. The sudden downshift in ETFC caught me by surprise. I think patience will pay off and that, within 6 months, we'll see at least a 33% return on this position (via a combination of ETFC covered calls and an actual stock movement up closer to $5)

I moved into short territory in early March, probably the worst possible timing because the market chose to rally strongly immediately after the purchase. But patience has paid off:
* Ultrashorts & QID are down a combined $2,091 or -5%. This is 41% of our invested position
* Puts are down a combined $810 or -3%. This is 29% of our invested position

What will it take for the shorts to generate positive returns?
Obviously patience matters most. We have plenty of room to wait - the Ultrashorts don't expire and most Puts go out to January 2009 (MGM expires September 2008 and AGN expires this month).
Having the right positions matters next. We have 3 quarters of earnings releases: July, October, & January. In a hostile market like today, one misstep will drop a stock hard. I believe that we have positions in companies that are at risk of lowered earnings guidance.
Finally, continued negative sentiment. We are in Bear territory. There will be rallies, but as long as the Bear continues to bite, we could see a further 10% dip in the markets over the next 4 months months. That's probably all we need to see a 15% return in these positions.

Ultrashorts & QID: most of these positions are ahead or barely 5% away from being positive. QID is the real problem here - down 23%.
Puts: The key here is that we have 2000 each of AN/HOG/NKE/VMC/ZLC and we have 6 months before they expire. A major move down in any of these stocks makes a big impression: every $1 gain in the put will drive $2000. If all puts go up $1, that drives $10K.

The longs are a calculated risk at the moment. Longs are 30% of our position.
I recently chose to dive into 3 stocks: DSX, DUG & MUR. I'll explain more below.

My short term focus:
Exit AN, AGN, NKE puts as soon as reasonable.
Hold MGM for a further dip
Write covered calls on ETFC AFTER earnings release