As April is heading towards the end I decided to report the trades I made recently which I have failed to report due to my busy schedule at work.
If you follow my blog, you may remember my desire to change the purpose of my accounts to different strategies. Thus my TD account is now dedicated primarily to options trading with dividend growth stocks as a base or core of the portfolio.
I recognized how powerful put selling strategy can be, and as Tom Sosnoff confirms in one of his shows that it is the most outperforming strategy out of all other strategies in Wall Street.
I must admit that I myself am stunned by results of this strategy and somewhat regret that I was stupid enough in the past not learning it earlier.
I have been trading options for three years. It is, though, early to claim that I am a proficient options trader, but I could claim my results so far. I have been making 45% profit in average during these three years.
Yes, you read it correctly. 45% profit may sound like too good to be true, but my trading speaks for itself. Last year I made 65%, this year I am heading towards 45% gain.
I plan to use gains from put selling to invest into dividend growth stocks and that would help me to create and grow my dividend growth portfolio faster than what I anticipated before. If I will be able to keep this strike of returns, I will double my investments every 1 and a half year. My small account should then reach 300,000 dollars in about 6 years. If still maintaining 45% average return, I should be making 135,000 dollars annually. Well enough to retire.
I can hear many people now doubting this vision, so this is also a challenge to me, but to all doubters. Will I make it? Or will I lose it all?
Let’s review the trades I made.
Taser Int. (TASR) rollover
First few trades were against Taser Int. (TASR). I had 2 September contracts at 17 strike. One contract was an original trade, the second was a rollover from 18 strike I made earlier due to TASR showing weakness.
A few days ago, TASR again suffered a sell off. I couldn’t find any reason for selling. The company reported better than expected results and also reported a new contract of stun guns worth of millions of dollars. I would assume this to be bullish, yet investors sold of hard. TASR fell by 6% that day.
I decided to roll those two trades lower, but keep the expiration. Thus I bought back two old contracts with 17 strike and sold 4 new contracts still in September, but 15 strike. This is well below TASR’s technical support and this level should hold.
Carlyle Group LP (CG) new trade
Well, I must admit this trade was opened by a mistake. Originally, I wanted to open a trade against Goldcorp Inc. (GG), but I messed up the symbols. However I do not regret this trade. CG pays nice dividend (as it is a limited partnership) and seems to be somewhat stable (the whole 2014 this stock seems to be a range bound; and that is quite well for put selling as the options lose value quite quickly. As of now, since the opening of the trade on April 16 I already see a 26% profit. It may still change till the end of the trade, but I do not expect it. I collected $182 premium with this trade.
Goldcorp Inc. (GG) new trade
This is the trade I wanted to open before I made a profitable mistake with Carlyle Group LP (CG). This trade is losing right now. I am still OTM, but the volatility is eating up my profits. I collected $130 premiums and will keep it if the trade expires worthless in October 2014.
These were the trades I made during the end of April.
Happy trading and good luck.