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2021 Week 44 investing and trading report

The first week of November is behind us. The year is nearing the end and in this investing and trading report, I will attempt to show you not only the results of our weekly trading and investing but also why I think this market is going to a very bullish end. The first week of November started well. We made a decent premium income bringing in $756.00 cash, we made $10.35 in dividends, and our net-liq jumped up by $1,654.80 reaching a total of $95,700.64. I am satisfied with the results so far and I believe, we will see better returns in the remaining weeks of the year.

 

Here is our investing and trading report:

 

Account Value: $95,700.64 +$1,654.80 +1.76%
Options trading results
Options Premiums Received: $756.00    
01 January 2021 Options: $4,209.00 +16.65%  
02 February 2021 Options: $4,884.00 +15.41%  
03 March 2021 Options: $5,258.00 +12.79%  
04 April 2021 Options: $2,336.00 +4.30%  
05 May 2021 Options: $6,346.00 +9.22%  
06 June 2021 Options: $4,677.00 +6.37%  
07 July 2021 Options: $3,865.00 +5.14%  
08 August 2021 Options: $6,133.00 +7.40%  
09 September 2021 Options: $2,353.00 +2.97%  
10 October 2021 Options: $8,721.00 +9.27%  
11 November 2021 Options: $756.00 +0.79%  
Options Premiums YTD: $49,538.00 +51.76%  
Dividend income results
Dividends Received: $10.35    
01 January 2021 Dividends: $53.04    
02 February 2021 Dividends: $63.00    
03 March 2021 Dividends: $30.31    
04 April 2021 Dividends: $139.70    
05 May 2021 Dividends: $167.45    
06 June 2021 Dividends: $168.56    
07 July 2021 Dividends: $228.62    
08 August 2021 Dividends: $780.09    
09 September 2021 Dividends: $176.60    
10 October 2021 Dividends: $256.73    
11 November 2021 Dividends: $10.35    
Dividends YTD: $2,131.78    
Portfolio metrics
Portfolio Yield: 4.16%    
Portfolio Dividend Growth: 8.13%    
Ann. Div Income & YOC in 10 yrs: $17,125.27 15.67%  
Ann. Div Income & YOC in 20 yrs: $129,430.83 118.45%  
Ann. Div Income & YOC in 25 yrs: $546,062.53 499.72%  
Ann. Div Income & YOC in 30 yrs: $3,550,188.16 3,248.92%  
Portfolio Alpha: 45.07%    
Portfolio Weighted Beta: 0.63    
CAGR: 625.36%    
AROC: 40.97%    
TROC: 14.04%    
Our 2021 Goal
2021 Dividend Goal: $1,071.42 198.97% Accomplished
2021 Portfolio Value Goal: $42,344.06 226.01% Accomplished
6-year Portfolio Value Goal: $175,000.00 54.69%  
10-year Portfolio Value Goal: $1,000,000.00 9.57%  

 

Dividend Investing and Trading Report

 
Last week the stock market moved higher on strong earnings. I keep saying, the market follows earnings. Everything else is just noise and bogus. If you believe that the market is manipulated or rigged, then take the earnings of the S&P 500 per share chart and overlay it over the S&P 500 chart. You will clearly see how highly correlate the two are. So all the rigging and manipulation claims are usually by those people who are losing money because they do not understand the market. And because they do not understand the market, they blame their losses on everything.

The market strong move (and I can tell you it will continue into the end of the year) had a positive impact on our account.

We received $10.35 in dividends last week. We kept adding dividend growth stocks to our portfolio as per our plan and accumulation rules.

Here you can see our dividend income per stock holding:

 
Annual Dividend Payout week 44
 

Options Investing and Trading Report

 
We generated $756.00 options income last week. Let’s see how our options income will look like by the end of the month. So far, if we continue receiving the same amount of cash, we are set to end November at $3,024 dollars. I hope we will do better than that. But it is too early to say.

Last week we mostly closed or rolled trades that were already worthless (so why sit on them). We added one trade against SPY (bull put spread) and SNOW (also a bull put spread). We closed a strangle against Realty Income (O) due to their merger and spinoff that is happening in November. It should be completed by November 12th. This caused the options to be a non-standard option after November 12th and set to closing only. This would make rolling trades and other adjustments difficult, so I decided to close the trade and reopen after the spinoff.

 

You can watch all our trades in this spreadsheet. You can watch the spreadsheet and look for a “NEW” indication next to the trading date. When the indicator shows up, it is typically good for up to 3 days to follow that trade.
 

Expected Future Dividend Income

 
We received $10.35 in dividends last week. It is still a very small income and I wish it could be larger than that but our stock holdings are still relatively small and “young” to show the full strength of the dividend investing. Yet, our portfolio currently yields 4.16% at $95,700.64 market value. I think this is not a bad result.

 
Our projected annual dividend income in 10 years is $17,125.27 but that projection is if we do absolutely nothing and let our positions grow on their own without adding new positions or reinvesting the dividends.

We are also set to receive a $4,063.72 annual dividend income. We are 23.73% of our 10 year goal of $17,125.27 dividend income.

 
Future Divi on YOC week 44
 

The chart above shows how our future dividend income is based on the future yield on cost and what dividend income we may expect in the future. The expected dividend growth depends on what stocks we are adding to our portfolio and the stocks’ 3 years average dividend growth rate. It is interesting to see what passive income we may enjoy 10, 20, 25, or 30 years from now.

 

Market value of our holdings

 
Our non-adjusted stock holdings market value increased from $121,107.63 to $126,668.98 last week.

However, we still expect the value of our holdings to grow and outperform the market long term. Many positions in our portfolio are new and “young” and they did not have enough time to show gains yet. We were building cash reserves to buy depressed stocks during selloffs and corrections as well as negative analysts reports (as long as the company is still good long term).

 
Stock holdings week 44
 

Our goal is to accumulate 100 shares of each stock of our interest and we are getting to that goal.
 

Investing and trading ROI

 

Our options trading delivered a 0.79% monthly ROI in November 2021, totaling a 51.76% ROI YTD. We again exceeded our 45% annual revenue selling options against dividend stocks target!

Our account grew by 365.19% beating our projections and the market.
 

Our options trading averaged $4,503.45 per month this year. If this trend continues, we are on track to make $54,041.45 trading options in 2021. As of today, we have made $49,538.00 trading options.
 

Old SPX trades repair

 

This week, we didn’t adjust any SPX trades. Our goal is to reach a level that we will be eligible for portfolio margin (PM). Once that happens, we plan on converting the existing SPX Iron Condors to strangles and trade these positions as strangles.

With RegT margin, the capital requirements would be approx. $66,586.06 and that is beyond our means. With PM the requirement for margin would drop to around $10k. That is doable in our account. Once we reach this level, we will start adjusting our SPX trades accordingly. Until then, we will just roll these trades around.

 

Accumulating Growth Stocks

 

Last week we have added shares of SSO to our holdings according to our plan and rules. Our goal for the nearest future is to accumulate 25% of our net-liq in SSO and SPXL and maintain the weight. If the weight goes above 25% we will start trimming the positions, and when the weight goes below 25% we will start accumulating the positions. Any leftovers will be reinvested to the dividend growth stocks, options trades, or reserves.

 

Accumulating Rules

 

Our rule is to buy shares of growth stocks using 20% of any BP value that is above the $4,000 November limit. For example, if our BP ends at $4,900, we can buy shares using 20% of $900 or $180 to accumulate shares of any growth stocks. Once we reach the $10,000 limit we will start scaling up our options trades again.

Why such a rule? Up to today, I was scaling up my trades and portfolio. That resulted in rapid growth but also all our proceeds were constantly locked in the trades. If we want to live off of our dividends and options income, we cannot have them locked by new trades. We need to start accumulating “cash available to withdraw”. Therefore, I am shifting my trading to trade the same amount of contracts and invest only a certain excess of the accumulated cash.

Another reason, of course, is to have enough cash to buy opportunities when the market crashes or corrects. As is typical, Wall Street usually overreacts (stupidly) and I want to buy shares when the market is in panic. Like in March 2020. I bought some shares but I wish, I had more free cash. I would buy more.

 

Accumulating Dividend Growth Stocks

 

Last week, we added shares of TD, MSFT, and AAPL to our dividend stock holdings. We are still accumulating SSO and SPXL as a primary goal (a growth sub-goal), but we are also adding dividend stocks to accumulate to 100 shares as that is our overall portfolio primary goal.

Our goal is to reach 100 shares of high-quality dividend stocks and build a weekly dividend income as per this calendar, but we have made no changes to this goal last week:
 

Weekly dividends income calendar
 
You can see the entire spreadsheet here.

 

Market Outlook

 

A week ago, it started being obvious that the market is going to rally for the rest of the year. Earnings are beating estimates and outlooks are better than expected. That pushes the market higher. It may be overvalued but its growth is still well in line with the earnings growth. Next year, it can be however a different story as the estimates indicate a lot smaller growth so the market still may go higher but not as strong and fast as today.

Last week, FED also announced its tapering of bond purchases and that would be normally taken as a negative move from FED and if done in the past, the market would throw a taper tantrum. It didn’t happen today.

If you are a subscriber to my newsletter, you will get another issue this weekend and I will describe this more in detail.

Here is what happened last week:
 

SPX 2021 1106

 
What you can see is that the markets rallied toward the 4710 level. That was the level what options market priced in as a 1 SD (1 standard deviation) at the beginning of the November expiration cycle. All big players, banks, and hedge funds usually sell options (only retail and Robinhood investors buy them), so at the beginning of the cycle, the big players sell their puts and calls and they usually do so at these levels as marked on our chart above. I do the same. When my October options expire, I sell November options at the same levels.

But then, the hedge funds start hedging and protecting their positions. When the market starts moving toward one or the other level, they start either buying shares or options to hedge the short position. That fuels the move. And that is what you can clearly see on last week’s chart. This was clear hedging and FOMO buying.

If you want to learn more about the stock market, events that moved the market last week and will likely impact it in the near future, I recommend you to subscribe to our weekly newsletter. Knowing where the market is heading and knowing when you should expect its reversal can benefit your trading and investing. Subscribe and you get one month free.

 

Investing and trading report in charts

 

Account Net-Liq

 

TW Account Net-Liq week 44

 

Account Stocks holding

 
TW Account holdings week 44
 

Last week, S&P 500 grew 62.39% since we opened our portfolio while our portfolio grew 35.55%. On YTD basis, the S&P 500 grew 32.55% and our portfolio 28.57%.

Our portfolio grew at the same pace as the overall market and we are pairing this year’s market performance. I expect this trend to continue in the next few years.

The numbers above apply to our stock holdings only. Our overall account net-liq grew by 365.19% this year! This is thanks to options trading that generates income. It can be also seen how the options help lower our cost basis. Just compare the P&L in the regular (left) column with the P&L in the “Options adjusted” column. For example, our AES holding would be a loser as of today (down -4.68%), but we generated enough income (we can call it also a return of our invested capital) and that position is 126.84% up.
 

Stock holdings Growth YTD

 
TW Account holdings Growth YTD
 

I expect our stock holdings to start outperforming the market very soon. The entire portfolio beats the market by far thanks to monetizing those positions.

Our 10-year goal is to grow this account to $1,000,000.00 value in ten years. We are in year two and we accomplished 9.57% of that goal.

Our 6-year goal is to reach $175,000 account value to be eligible for portfolio margin (PM) and today we accomplished 54.69% of that goal.

Our 2021 year goal is to grow this account to a $42,344.00. We already accomplished this goal.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Income week 44
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Income week 44
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 44
 

We have accomplished our dividend income goal. We planned to make $1,071 of dividend income this year and we finished receiving $2,131.78. However, we accumulated enough shares to start making $4,063.72 a year.
 

TW Received vs Future Dividends week 44

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return.
 

TW cumulative return wk 44
 

TW win ratio wk 44
 

As of today, our account cumulative return is 58.93% (note, data in this section are since March 13, 2021, only as that is the date we started tracking these metrics. Thus the results are skewed a bit and will show full picture next year.).

 

Conclusion of our investing and trading report

 

This week our options trading was within our expectations and I believe, the rest of the month will be even better.

We will continue accumulating the dividend growth stocks in our portfolio to reach 100 shares and continue building our cash reserves so we have enough cash to sustain any market corrections and be able to buy depressed stocks.

We will report our next week’s results next Saturday. Until then, good luck and good trading!





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