Posted by Martin June 30, 2017


Markets lost 2% intraday yesterday, should we be worried?

Bears are coming out of the woods lately. Many say: “I told you so.” Are we turning into a long anticipated correction?

I am not so sure.

Yes, the recent market behavior looked scary:


The markets lost 2% intraday yesterday and broke below 50 day moving average. Later on it erased some of the losses.

Today, the market started higher but couldn’t keep up and dipped again. We finished where we started.

This market turbulence had a devastating impact on our portfolio too. During the whole month our net-liq grew steadily up and all our positions seemed sitting well in gain territory.

The last two days in the market (the tech stocks sell off) erased it all and we will finish June with substantial loss. Unrealized loss, but loss which makes me uncomfortable.

However, I still think this is just another dip. A gift to investors with a plan. Although the stocks lost 2% the US economy is growing and in fact accelerating.

This selling pressure from anxious bears is just an opportunity to buy the dip.

In the last six months, S&P 500 grew by 7% and Nasdaq by 14.4%. That is a good progress. And it seems we will see more uptrend as GDP is again pointing up.

Bear market
(credit: Hedgeye.com)

In 2015 our GDP peaked at 3.3% and since then, it has been sliding down to meeker 1.3% by the second quarter of 2016. For the rest of 2016 and in 2017 we saw GDP rebounding back up to 2.1%!

Are we to hit 3% GDP growth again?

We have seen a year of accelerating economy and consumer confidence. These will push the markets higher again.


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Posted by Martin June 28, 2017
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TECK strangle trade #2

UPDATE: June 28, 2017

We have 2 days to expiration for this trade and our put side just closed for 0.02 debit:

BTC 1 TECK Jun30 16.00 put
@ 0.02 debit


We still hold our Jun30 16.50 calls but they are now in the money. I do not expect the stock to drop from the current $17.23 a share down below 16.50 in two day although anything can happen. We will wait one or two more days to see and then eventually roll our calls higher and sell new puts.

UPDATE: June 15, 2017

As calls got closed a few days ago and puts slipped in the money (ITM) I decided to roll puts down and sell new calls against it:


BTC 1 TECK Jun30 16.50 put
STO 1 TECK Jun30 16.00 put
STO 1 TECK Jun30 16.50 call

@ 0.26 credit limit

Although now the trade has a very narrow window for both legs to expire or be bought back for nothing (and actually I do not expect it much) I am OK with this trade.

If the stock continues slipping down, the calls may get actually closed again and later on, if we see a recovery, the puts can get closed. This will not be a bad idea necessarily.




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Posted by Martin June 27, 2017
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TECK June 30 Iron Condor closed (ROTH IRA)

I failed to report opening of this trade when I opened it on June 14. It was such a busy month that I was not always able to report all my trades properly so you can enjoy watching and following my trading journey.

At some point in the past my old Iron Condor closed for profit and it was way before expiration of the old trade so I decided to open a new Iron Condor in my ROTH IRA account.

Here was the trade:


BTO 1 TECK Jun30 20.00 call
STO 1 TECK Jun30 18.50 call
STO 1 TECK Jun30 15.50 put
BTO 1 TECK Jun30 14.00 put

@ 0.20 credit limit

It wasn’t a big credit but I could snap a small one using the same expiration time frame, so I took it.

On 6/19/2017 the call side closed for 0.02 debit and today, the put side closed for 0.02 debit too. Total credit received was $16 dollars. The trade is now closed.



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Posted by Martin June 26, 2017
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STX Aug18 Iron Condor (ROTH IRA)

Our original STX Iron Condor closed today morning for a full profit of $40 dollars. Since the trade is closed, we can now open a new one.

I am placing a new Iron Condor in our ROTH IRA account:

BTO 1 STX Aug18 49.00 call
STO 1 STX Aug18 47.00 call
STO 1 STX Aug18 39.00 put
BTO 1 STX Aug18 37.00 put


@ 0.69 credit limit day


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New Iron Condor with STX in ROTH IRA

UPDATE: June 26, 2017 (TRADE CLOSED)

Today morning, our STX (Seagate Technology) June 30th 40.00 put strike closed for 0.04 debit. This closes our original Iron Condor completely and we can open a new trade (our calls closed at the beginning of the month for 0.02 debit so we only had puts on).

ORIGINAL TRADE: May 24, 2017

I had an Iron Condor in my ROTH IRA account (unreported in this blog) against Seagate Technology (STX) stock.

That trade closed today morning for a full profit. This released our buying power for a new trade.

We are opening a new Iron Condor against STX:

BTO 1 STX Jun30 38.50 put
STO 1 STX Jun30 40.00 put
STO 1 STX Jun30 46.00 call
BTO 1 STX Jun30 48.50 call

@ 0.34 credit limit

STX @ 43.04

Trade executed at 0.46 credit.


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Posted by Luis Aureliano June 26, 2017
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Contrarian Investments for Savvy Individuals

Many traders and investors blindly assume that there is only one way to dabble in the financial markets: conventional stocks trading. Fortunately, nothing could be further from the truth. The more you learn about the financial markets, the better informed you are about your options, and there are many of them. Let’s go back to the traditional form of investing for a second and understand what benefits are available with things like stocks, commodities, indices, and currencies trading.

If you were to go to a land-based institutional broker, that person would charge you hefty fees and commissions to manage your finances – independently of your input. You are effectively entrusting your financial livelihood into the hands of a complete stranger. True, these people are well informed about the funds their brokerages are selling – but they’re in it for themselves, not for you. Monthly maintenance charges, hidden fees, commissions, annual expenses, and other costs await you. There are no guarantees with stocks, commodities, mutual funds, ETFs and the like.

Does this mean that you should avoid any risk -related investments? Absolutely not! Without the risk elements, there would be no reward to speak of. Typically, financial portfolios are made up of a mix of domestic and international stocks, cash, bonds, immovable property and the like. The more diversified your financial portfolio, the less overall risk you assume. The precise ratios of each component in your financial portfolio will vary according to the financial advisor in question. However, conventional wisdom states your risk profile determines your mix of assets. A balanced portfolio is one where the investor reduces volatility by including stable financial assets in the portfolio.


 · What mix of stocks and bonds is best?


Balanced portfolios allow for growth and accommodate short-term price movements, with an eye to long-term gains. The precise mix of this type of portfolio is 60% bonds and 40% stocks. According to leading investment enterprises, your average annual return on such a portfolio can be around 7.8%. As you increase the stock component of your portfolio, so you increase the volatility of your profile. Remember that stocks typically generate substantially more than bonds, so your returns are going to be greater with a stock-heavy profile – provided you can tolerate the risk. The worst year in the history of stocks was 1931 – the height of the Wall Street crash and the global depression that followed.

Growth-oriented financial portfolios are ones that are heavily slanted in favour of stocks, with a minimal allocation to bonds. Recall that bonds generate fixed-interest payments and include things like Treasury Notes (2 years, 5 years, 10 years, 20 years, etc.). If you were completely risk-seeking, you may opt for a financial portfolio that is 100% based on stocks. Your best bet as an investor would be stocks, provided you could whether the storms along the way. There are many other ways to rebalance your financial portfolio, or incorporate additional forms of investment.


 · Growth-oriented strategies to boost your financial portfolio


Richard P. Horton, a Lionexo trading options expert believes that traders will find tremendous benefit in alternative investment options. ‘I’ve seen many traders asking for ways to diversify their financial portfolios. These include speculative trades on stocks, commodities, indices, and currency pairs without actually owning the underlying assets. By forecasting future price movements, you can turn over vast sums of money in next to no time at all, generating significantly more profitability in the process. When you wait for stocks to appreciate, you’re tying up all your available resources in individual trades. This is inherently risky, and is especially detrimental when cash is required. Short-term trades ensure liquidity, and substantial profits can be generated on in-the-money outcomes.’


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Posted by Martin June 23, 2017
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United Steel (X) trade adjustment

UPDATE: June 23, 2017

X is moving up (although I still believe that in the next ER they will miss badly again) but decided to roll my calls higher.
In my previous trade (see below) I sold 18 strike puts to roll the calls up. Those puts were bought back for 0.05 debit today morning and there fore I can sell new puts and roll calls higher again:

BTC 1 X Oct20 17.00 call
STO 1 X Jan19 18.00 call
STO 2 X Jul21 19.00 put

@ 0.49 credit limit day

X @ 22.28
IV @ 56.81%

(The trade executed)

The company reports earnings on July 25th and thus I opened this trade with puts expiring prior to that event. I will be then waiting after the ER for the next adjustment.




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Posted by Martin June 20, 2017
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AGNC covered call (ROTH)

UPDATE: June 20, 2017 (TRADE CLOSED)

I didn’t expect to get early assigned on this but it just happened. At least, I do not have to wait until expiration to get assigned.

Today, I bought back 100 shares of AGNC @ 22.50 a share.

This closes this trade cycle. I do not plan trading any more options using this underlying as there are no premiums. This whole trade was in fact a bad idea. So not anymore.




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Posted by Martin June 16, 2017
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TECK strangle #3

UPDATE: June 16, 2017

When I was opening this trade I felt confident that this is a safe bet. Apparently not. Mr Market can be very challenging trying to take your money away. That’s why it is important to have a strategy for days when the market goes against you. And believe me, it will be most of the time!

As TECK continues down on lowered guidance, our July 7th 20.50 calls closed for 0.02 debit today (remember, after I open a strangle trade, I immediately place a closing GTC order, which executed automatically once the conditions are met).

Since our calls closed, I decided to roll the put side lower the same way as I did yesterday with June 30 trade. Here are all trades review:

BTC 1 TECK Jul7 20.50 call @ 0.02 debit

and here is the roll:

BTC 1 TECK Jul7 16.00 put
STO 1 TECK Jul7 15.50 put
STO 1 TECK Jul7 16.50 call

@ 0.12 credit limit day

After the old call closed I rolled the above put down a bit and added a new call creating a new strangle. I expect one leg will have to be rolled again later on (I will wait closer to expiration for the next roll).

ORIGINAL TRADE: June 8, 2017



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Posted by Martin June 14, 2017
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New Iron Condor using TECK in ROTH IRA

UPDATE: June 14, 2017

We rolled our June 30th 17 strike into November 17, 2017 expiration and 17 strike. We also added new call side creating a new Iron Condor:

BTC 1 TECK Jun30 17.00 put
STC 1 TECK Jun30 15.00 put
STO 1 TECK Nov17 17.00 put
BTO 1 TECK Nov17 15.00 put
@ 0.25 credit limit

And here is the call side addition:

STO 1 TECK Nov17 19.00 call
BTO 1 TECK Nov17 21.00 call
@ 0.45 credit limit

Total credit received 0.70 + previous credit 0.19 = 0.89 credit.

UPDATE: June 08, 2017

This morning, our call side of this Iron Condor has closed for 0.02 debit:

BTC 1 TECK Jun30 22.00 call @ 0.02 debit

We still hold the put side waiting for it to either end or be rolled.

ORIGINAL TRADE: May 22, 2017



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