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Posted by Martin April 30, 2022
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HFEA April 2022 strategy report


Our HFEA strategy got a severe beating in April as there was nowhere to hide. Stocks got beaten down as well as bonds. A TMF position that was supposed to protect the account got sold off terribly and we hold larger losses in TMF than in the SPXL.

The only unit that held a bit up was an inverse bond ETF TBT but, unfortunately, we do not have a very large position in it, so the protection is insignificant.

So what is next? I reconsidered the HFEA strategy and decided to abandon the TMF position at some point in the future. As of now, I hold some options against TMF but as soon as I will be able to close them (now it would be for a loss), I will re-allocate TMF funds into SPXL and let SPXL run only. As of today, I am investing heavily in SPXL adding more shares, and waiting for the market to finally end its craziness over nothing (yes, I do not consider the fears that our there significant enough to cause the selling that will be forgotten next quarter or next year… I do not care when, but it will be forgotten). And when that happens, I expect the SPXL position to outperform the market significantly. I am also selling covered calls against SPXL (TMF, and TBT).

Originally, I dedicated $15,000 to this strategy. That represented approx. 15% of our portfolio. If the strategy underperforms and is below this amount, I will add cash to it. If it outperforms and ends above this threshold, I will trim the position and save the cash aside. We will be rebalancing quarterly and our next rebalancing will occur at the end of June 2022.

The HFEA strategy is about investing in leveraged ETF but adding protection to the downside since the leverage works both ways. I like the idea because drawdowns can be significant.
 

Initial HFEA allocation

 
Start date: 11/27/21
Approach: Variable allocation* – 75%/25% SPXL/TMF
Rebalancing frequency: Quarterly*
Return (total / YTD): -44.95%/-44.95%
Initial contribution: 15% of portfolio Net-Liq (~ $15k)
 

* Variable allocation will be adjusted based on the moving averages and VIX term structure. When moving averages turn negative (downside) and VIX turns into backwardation, the SPXL allocation will be decreased and TMF allocation increased.

 

Current HFEA allocation

 
Goal Approach: 75% SPXL, 25% TMF
Current Approach: 64% SPXL, 36% TMF
 

MONTH NET-LIQ PROFIT/
LOSS
PROFIT/
LOSS %%
November 2021 $13,441.91 $0.00 0.00%
December 2021 $14,773.72 $1,331.81 9.91%
January 2022 $12,597.96 -$2,175.76 -14.73%
February 2022 $11,665.69 -$932.27 -7.40%
March 2022 $12,483.01 $817.32 7.01%
April 2022 $8,694.65 -$3,788.36 -30.35%

 

Our HFEA strategy lost -30.35% in April 2022 while the entire market lost -9.03%.
 

HFEA charts

 
HFEA net-liq 03
Strategy Net liquidation value
 

HFEA vs SPY net-liq 03
Strategy vs SPY Net liquidation value
 

HFEA vs SPY
Strategy performance vs. SPY
 

April turned out to be the worst month ever for this strategy as both the SPXL and TMF funds declined significantly. However, I am going to slowly re-allocate funds into SPXL in preparation for the next market rally. When it comes, I expect this strategy to outperform the market significantly.
 
 




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Posted by Martin April 30, 2022
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2022 SPX put credit spreads trading review – week 17


Our SPX PCS strategy finished up by 1.71% while SPX lost -3.27%. Last week was a horrible week. As pundits and media say, it was the worst week since 2008. There seems to be no end to selling pressure. Our account performed well but I do not feel happy about it because it was very stressful trading. I opened two new trades but other than that I was mostly in a defense mode protecting and rolling the trades.

Our overall SPX account is up +180.61% since the beginning of this program, and we have -$105 in unrealized losses.
 

If the market stays sideways in this wide sideways range, I will be trading Friday’s trades only. If we break below the critical support, I might be trading call side or skip trading at all until the market calms down.
 

Initial trade set ups

 

For my SPX strategy, I dedicated a $3,600 initial amount that will be used to trade SPX PCS strategy per week. If this amount is depleted, I will evaluate the strategy to determine whether to continue or change it. If I grow this amount, I will scale up the trading.
 

WHAT WILL WE TRADE?    
DAY DTE TYPE
MONDAY 7 DTE & 40 delta 10 wide Put Credit Spread
TUESDAY 30 DTE & 40 delta 10 wide Put Credit Spread
WEDNESDAY 7 DTE & 40 delta 10 wide Put Credit Spread
FRIDAY 60 DTE & 14 delta 10 wide Put Credit Spread
EVERY MONTH 120 DTE Put Debit Spread – HEDGE

 

Last week trading

 

Overall, the strategy resulted in a $170.00 gain last week.
 

Initial account value (since inception: 12/07/2021): $3,600.00
Last week beginning value: $9,931.95
Last week ending value: $10,101.95 (+1.71%; total: +180.61%)
The highest capital requirements to trade this strategy: $19,190
Current capital at risk: $18,105
Unrealized Gain: -$105 (-0.58%)
Realized Gain: $6,492 (+35.86%)
Total Gain: $6,387 (+35.28%)
Win Ratio: 69%
Average Winner: $213
Average Loser: $259

 

SPX PCS account value
SPX PCS account value
 
Our SPX net-liq increased slightly last week creating a new all-time high. But the market is volatile too much and our trading activity will be adjusting our existing trades, and opening Friday’s trades, only. We will evaluate case by case which trade to take.
 

SPX PCS account vs SPX
SPX PCS account vs SPX index net liq
 
However, it is nice to see that our account is growing while the market is struggling, going sideways or down. Although I must admit, trading in this year’s environment is very frustrating.

 

SPX PCS account vs SPX
SPX PCS account vs SPX index
 

If you want to receive trade alerts whenever we open a new SPX put credit spread or a hedge trade, you can subscribe to our service:

 

 

Note, if you wish to subscribe to multiple levels, you can do so by subscribing to one level only and then send us an email that you want to be added to other levels too.

Also, if you like this report, hit the like button so I know there is enough audience wanting to see this type of report. If you have any questions or want to see anything else about my SPX trading, do not hesitate to contact me or write a comment in the comments section. Thank you!

 
 




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Posted by Martin April 23, 2022
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2022 Week 16 investing and trading report


Once again I was surprised with our options trading results this week. I expected a positive return but only around $1,000 dollars. So receiving $3,108 in options premiums was a nice surprise that offset the horrible account balance results. Our net-liq dropped significantly again and we pretty much erased all last year’s gains. But the loss is temporary! We have not sold any equity for a loss and we are seeing losses in options due to rolling the options. When you roll the option, you close the old trade (typically for a loss) and open a new trade that offsets the loss. The loss is a realized one, the new credit is unrealized. Once the market stabilizes and we start seeing our options trades expiring, the net-liq will skyrocket. We just have to wait out this terrible market and keep rolling.

 

Here is our investing and trading report:

 

Account Value: $98,050.47 -$4,395.61 -4.48%
Options trading results
Options Premiums Received: $3,108.00    
01 January 2022 Options: $8,885.00 +8.36%  
02 February 2022 Options: $10,009.00 +10.34%  
03 March 2022 Options: -$1,662.00 -1.47%  
04 April 2022 Options: $3,870.00 +3.95%  
Options Premiums YTD: $21,102.00 +21.52%  
Dividend income results
Dividends Received: $50.22    
01 January 2022 Dividends: $303.38    
02 February 2022 Dividends: $732.81    
03 March 2022 Dividends: $393.74    
04 April 2022 Dividends: $111.05    
Dividends YTD: $1,540.98    
Portfolio metrics
Portfolio Yield: 5.17%    
Portfolio Dividend Growth: 11.61%    
Ann. Div Income & YOC in 10 yrs: $52,906.28 34.28%  
Ann. Div Income & YOC in 20 yrs: $1,655,646.58 1,072.70%  
Ann. Div Income & YOC in 25 yrs: $28,562,517.66 18,505.77%  
Ann. Div Income & YOC in 30 yrs: $1,619,647,588.25 1,049,376.28%  
Portfolio Alpha: 16.27%    
Sharpe Ratio: 6.93 EXCELLENT  
Portfolio Weighted Beta: 0.47    
CAGR: 442.43%    
AROC: 16.45%    
TROC: 9.03%    
Our 2022 Goal
2022 Dividend Goal: $4,800.00 32.10% In Progress
2022 Portfolio Value Goal: $151,638.03 64.66% In Progress
6-year Portfolio Value Goal: $175,000.00 56.03% In Progress
10-year Portfolio Value Goal: $1,000,000.00 9.81% In Progress

 

Dividend Investing and Trading Report

 
Last week we have received $50.22 in dividends bringing our April’s dividend income at $111.05.

Last week, we have not purchased any dividend stock.

 

Here you can see our dividend income per stock holding:

 
Annual Dividend Payout week 16

 

Growth stocks Investing and Trading Report

 

Last week, we have not purchased any growth stocks.

However, I was adding the ICSH fund to increase reserves. Last year, I built nice reserves in this cash equivalent fund but then I thought that holding cash in that account is a waste of resources and I liquidated the holdings and invested it into dividend-paying stocks. That is not necessarily a bad thing but I have no cash reserves that I can tap into. The cash in the account is tied to the current margin maintenance and cannot be used. This was a lesson learned. Now that the market tanked, I struggle to keep the account buying power positive. If I had the reserves intact, I could be now selling the ICSH position to release funds instead of hastily rolling the trades around to stay afloat. So, I am slowly rebuilding those reserves to the previously determined level.

Options Investing and Trading Report

 
Last week we rolled our strangle trades to keep our account safe. Some of those rolls could have been avoided if I had enough cash reserves.

However, these adjustments delivered income of $3,108.00 making our April options income $3,870.00.

 

We were actively trading our SPX strategy that delivered $1,940.00 gain.

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 have received $50.22 in dividends last week. Our portfolio currently yields 5.17% at $98,050.47 market value.

 
Our projected annual dividend income in 10 years is $52,906.28 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 $5,941.07 annual dividend income ($495.09 monthly income). We are 11.23% of our 10 year goal of $52,906.28 dividend income.

 
Future Divi on YOC week 16
 

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 decreased from $156,795.57 to $148,744.46 last week.

In 2022 we plan on accumulating dividend stocks, monetizing these positions, HFEA strategy, and SPX trading. We plan on raising more of our holdings to 100 shares so we can start selling covered calls. We continued rebalancing our options trades that released buying power significantly. That allowed us to start buying shares of our interest again.

 
Stock holdings trading week 16
 

Our goal is to accumulate 100 shares of dividend growth stocks we liked and then start selling covered calls or strangles around those positions. We also planned on reinvesting all dividends back into those holdings.
 

Investing and trading ROI

 

Our options trading delivered a 3.95% monthly ROI in April 2022, totaling a 21.52% ROI YTD. We hope that in 2022 we exceed our 45% annual revenue selling options against dividend stocks target, although as of today, we are getting behind this goal.

Our entire account is down -6.30%.
 

Our options trading averaged $5,275.50 per month this year. If this trend continues, we are on track to make $63,306.00 trading options in 2022. As of today, we have made $21,102.00 trading options.
 

Old SPX trades repair

 

Last week we have not adjusted any of our old trades. The market is playing with me. When all the ods looked good and I had a chance to get rid of one bad trade, the market tanked ruining my chance to improve the position. Now I am back at the beginning of my attempt to fix the old trade.

We however traded our SPX put credit spread strategy which you will be able to review in my next report. The SPX strategy held well so far, and our signals kept us away from opening new trades.

 

Market Outlook

 

The stock market did what we expected it would do. It bounced last week and then wasn’t able to break above the strong resistance at 200-day MA. Then Powell spoke and sent the market to the abyss. Currently, it is on the track to retest the February 24th lows which is what I think is going to happen. On Monday, we may see a flush out and then possible bounce but overall we will be reversing and heading lower.
 

If you want to find out more about the market outlook, 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 trading Net-Liq week 16

 

Account Stocks holding

 
TW Account holdings week 16
 

Last week, S&P 500 grew 47.67% since we opened our portfolio while our portfolio grew 13.25%. On YTD basis, the S&P 500 fell -17.09% and our portfolio -16.53%. We are outperforming the market although by a small percentage point.

The numbers above apply to our stock holdings only. Our overall account net-liq is down by -6.30% this year thanks to our options strategies that generated enough income to stay up a bit.
 

Stock holdings Growth YTD

 
TW Account holdings Growth YTD
 

Our stock holdings are starting to outperform the market. Hopefully, this trend will stay and we will be doing better than S&P 500 constantly.
 

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 9.81% 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 56.03% of that goal.
 

Our 2022 year goal is to grow this account to a $151,638.03 and today we accomplished 64.66% of this goal.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Trading Income week 16
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Trading Income week 16
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 16
 

We planned to make $4,800.00 in dividend income in 2022. As of today, we received $1,540.98. This is in line with our projected dividend 2022 goal. We also accumulated enough shares to start making $5,941.07 a year.
 

TW Received vs Future Dividends week 16

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return since we started tracking this metric.
 

TW cumulative (overall) trading return wk 16
 

Here is the cumulative return for the year 2022:
 

TW cumulative (2022) trading return wk 16
 

Our win ratio overall:
 

TW trading win ratio (overall) wk 16
 

Our win ratio for 2022:
 

TW trading win ratio (2022) wk 16
 

As of today, our account overall cumulative return is -1.09% (note, data in this section are since March 13, 2021, only as that is the date we started tracking these metrics). Our 2022 cumulative return is -33.00%. That means we erased the entire 2021 revenue as of today. That is a horrible result. But I am optimistic. As I mentioned above, the results are temporary as we are rolling our trades and these rolls cause realized losses while we have open unrealized gains. Once the open trades end (when this horrible market finally calms down), the gains will offset the losses.

I have a favor to ask. If you like this report, please, hit the like like button button so I know that there is enough audience that like this content. Also if there is something you want to know or you want me to change this report to a different format, let me know in the comments section.

 
 




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Posted by Martin April 23, 2022
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2022 SPX put credit spreads trading review – week 16


Our SPX PCS strategy finished up by 24.27% while SPX lost -2.75%. Last week was a horrible week. The market lost over 5% in two days based on fear of the FED raising rates “too aggressively”. But our account was up significantly.

But there is nothing much to celebrate. All I was doing was adjusting the old trades and adding hedges against them. I was adding call spreads because my old put spreads were in the money and I will have to roll them at some point in the future. My rationale behind this was to bring in as much credit as possible by selling call spreads and hopefully buy the call spreads back for cheap, then roll the put spreads and add new call spreads to bring in more credit to offset the cost of rolling the put spreads. So, this week’s large income may disappear in the next coming weeks.

Our overall SPX account is up +175.89% since the beginning of this program, and we have -$380 in unrealized losses. At some point, we will have to work hard to offset those losses.

During this volatile and sideways market, we will be trading Friday’s trades only until the market sets the direction it wants to go.
 

Initial trade set ups

 

For my SPX strategy, I dedicated a $3,600 initial amount that will be used to trade SPX PCS strategy per week. If this amount is depleted, I will evaluate the strategy to determine whether to continue or change it. If I grow this amount, I will scale up the trading.
 

WHAT WILL WE TRADE?    
DAY DTE TYPE
MONDAY 7 DTE Put Credit Spread
TUESDAY 30 DTE Put Credit Spread
WEDNESDAY 7 DTE Put Credit Spread
FRIDAY 60 DTE Put Credit Spread
EVERY MONTH 120 DTE Put Debit Spread – HEDGE

 

Last week trading

 

Overall, the strategy resulted in a $1,940.00 gain last week.
 

Initial account value (since inception: 12/07/2021): $3,600.00
Last week beginning value: $7,991.95
Last week ending value: $9,931.95 (+24.27%; total: +175.89%)
The highest capital requirements to trade this strategy: $19,160
Current capital at risk: $16,380
Unrealized Gain: -$380 (-2.32%)
Realized Gain: $6,711 (+40.97%)
Total Gain: $6,331 (+38.65%)

 

SPX PCS account value
SPX PCS account value
 
Our SPX net-liq increased significantly last week creating a new all-time high. But the market is volatile too much and our trading activity will be adjusting our existing trades, and opening Friday’s trades, only. We will evaluate case by case which trade to take.
 

SPX PCS account vs SPX
SPX PCS account vs SPX index net liq
 
However, it is nice to see that our account is growing while the market is struggling, going sideways or down. Although I must admit, trading in this year’s environment is very frustrating.

 

SPX PCS account vs SPX
SPX PCS account vs SPX index
 

If you want to receive trade alerts whenever we open a new SPX put credit spread or a hedge trade, you can subscribe to our service:

 

 

Note, if you wish to subscribe to multiple levels, you can do so by subscribing to one level only and then send us an email that you want to be added to other levels too.

Also, if you like this report, hit the like button so I know there is enough audience wanting to see this type of report. If you have any questions or want to see anything else about my SPX trading, do not hesitate to contact me or write a comment in the comments section. Thank you!

 
 




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Posted by Martin April 20, 2022
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Netflix (NFLX) isn’t dead despite Wall Street’s gloom and doom


Netflix (NFLX) reported a decline in subscribers in the second consecutive quarter. And Wall Street is panicking and predicting the end of the company. Everybody – Youtubers, talking heads on CNBC, Facebook, Reddit is now bearish and talking about the gloom of Netflix being dead. Everybody has a solution now and everybody knows what to do now – after the fact.

So, is Netflix dead? I do not think so. It is just resetting to its true fair value. But also remember that Wall Street is a short-sighted beast. They only look to the next quarter and focus on the wrong thing, in this case, subscribers.

During the Covid pandemic, Netflix was one of the many companies that benefitted from the lockdown. People were sitting at home, playing games, watching movies. Many companies saw significant growth in users. Netflix had millions of new subscribers during that time, too.

In 2018 – 2019 we saw a subscribers base stagnation when Netflix added 28 million new subscribers in 2018 and 27 million in 2019 (the entire 2019 was showing a slow down). But then in 2020 Netflix added almost 37 million new subscribers. That’s almost 40% growth YoY! And now, when the pandemic is over, people are returning back to work and they do not have time to sit in front of the TV watching Netflix, many are unsubscribing from the service. I do not know how about you but to me this was a predictable and natural development.

 
Netflix subscribers
 

Comparing subscribers to the unusual year is foolish as well as it was foolish to chase the stock because of the unusual growth and rally its price from $300 a share to $600 a share.

And Wall Street was cheering like a drunkard over Netflix’s growth. I remember myself thinking if this growth was to be sustainable, where else would Netflix chase the new subscribers? On Mars, maybe?

And now, that the obvious started happening the same imbeciles at Wall Street are saying on CNBC that this is the death of Netflix that is suffering from a streaming war.

However, I do not think Netflix is dead. It is just resetting from an incredibly high valuation but it will grow at the same pace as it was growing before the pandemic. Why?

 

Netflix should stop reporting subscribers

 

We can look at a clue with Apple (AAPL). Some time ago, AAPL reported few phone sales in a few consecutive quarters, and obsessed Wall Street was digging a grave for APPL predicting the end of a behemoth. Saturated market, no more new expensive phones, years of declines ahead, they shouted.

And what did Apple do? They simply stopped reporting the phone sales and focused on revenue and earnings only. No end happened. No dead bodies to bury. And Apple prospers reporting earnings and revenue only and the obsessed Wall Street has one more worry to stop freaking about.

Netflix should do the same and stop reporting subscribers. That number is misleading and has very little value in providing the overall picture of the company’s health. Netflix is an industry leader with the largest subscriber base in the world. The sound in line is Amazon Prime and they only have 70% of Netflix’s subscriber base (Netflix is at 209 million, Amazon 150 million, the rest is way below those numbers).

 

Netflix and inflation

 

Tom Rogers, a media expert, provided a good insight into why he thinks Netflix will actually benefit from the current situation in the long run. He says that during the high inflation many people will be looking at cutting expenses and the first thing that will go is cable TV. They will cut the cord and subscribe to Netflix. Why Netflix? One reason is that Netflix has the widest variety of content compared to other providers (so far, it may change, but like it or not, Netflix provides the largest ad-free content out there). We will see some fluctuations when people will be searching for their best streaming provider and you may see them going from one provider to another before they settle. But that is the nature of this industry too.

I admit, this view is totally in line with my bias and I may be wrong along with Tom Rogers.

 

Netflix and cheap ad-supported subscription

 

One reason why I left the cable TV and refuse to watch other providers is advertising. I hate having my movie cut into pieces with 5 to 10-minute long advertisements. It was a premise of people cutting the cord. It was why Netflix was so revolutionary in the beginning. No ads no obstructions. And now, we are supposed to be going back to what we were cutting off? I still hate Amazon providing paid and ad-supported movies on top of my Prime subscription and I do not watch these movies. I always select “free to me” and browse free movies only.

 

Is Netflix overvalued? Yes and No…

 

It depends on how you look at its price after today’s carnage. In my opinion, the stock is now valued at its multiple (or slightly above it). At the current price of $226 a share, the stock is overvalued for this year and next year’s earnings correlated multiples. The calculated fair value for this year is $163 a share, for 2023 it is $211 a share and for 2024 it is $272 a share.

 
Netflix potential growth
 

So if nothing seriously bad happens, buying at this level should be a good long-term opportunity. And as a long-term investor, I think, the company will grow even more over time. of course, if you are looking for a quick buck by the next quarter, you will have to pass this stock. It will not get there any time soon.

 

Should you buy Netflix or wait?

 

I think there is still a lot of blood and weak hands on the street and many sellers will be dumping their shares. So, it is my opinion that Netflix will go lower for some time. It may be going lower just tomorrow, or we may see a bounce as buyers will step in. But, there are too many subscribers-obsessed investors who now think that Netflix will lose even more subscribers until there will be no one left and these people will be selling. Add short sellers to the mix and the stock will be heading lower.

Thus, I think, we should wait until the dust settles.

I added 10 shares of Netflix after the first 25% drop last quarter, so I am now sitting on a loss. But I am buying for the long term. I plan on holding this stock for the next 30 or more years. I refused to buy when Netflix was at $600 as I thought that it was way too overvalued so I avoided the huge loss. If you are the one who bought at those levels and didn’t sell, your only strategy is either take the loss and move on or keep holding and selling covered calls to lower your cost basis. It will be a long process to get out of the hole, but if you have time on your side, you have nothing to lose, unless you believe, that Netflix is finished.

And, I personally, will be adding more shares once the stock shows its bottom. So not yet. Hold!

 
Hold buying Netflix
 
 




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Posted by Martin April 16, 2022
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2022 Week 15 investing and trading report


I expected my options trading last week to be a disaster, so I was quite surprised that I could achieve positive returns and brought in over $600 in premiums. Of course, compared to premiums received in the previous months or during 2021, this is a mediocre result (and it is an overstatement). But given the market’s horrible conditions, bearish sentiment, volatility, and my last month’s loss, I consider it a good result.

 

Here is our investing and trading report:

 

Account Value: $102,446.08 -$6,031.58 -5.89%
Options trading results
Options Premiums Received: $668.00    
01 January 2022 Options: $8,885.00 +8.36%  
02 February 2022 Options: $10,009.00 +10.34%  
03 March 2022 Options: -$1,662.00 -1.47%  
04 April 2022 Options: $762.00 +0.74%  
Options Premiums YTD: $17,994.00 +17.56%  
Dividend income results
Dividends Received: $0.00    
01 January 2022 Dividends: $303.38    
02 February 2022 Dividends: $732.81    
03 March 2022 Dividends: $393.74    
04 April 2022 Dividends: $60.83    
Dividends YTD: $1,490.76    
Portfolio metrics
Portfolio Yield: 5.09%    
Portfolio Dividend Growth: 11.61%    
Ann. Div Income & YOC in 10 yrs: $52,235.61 33.48%  
Ann. Div Income & YOC in 20 yrs: $1,589,728.43 1018.81%  
Ann. Div Income & YOC in 25 yrs: $26,755,585.58 17,146.81%  
Ann. Div Income & YOC in 30 yrs: $1,466,881,262.46 940,078.12%  
Portfolio Alpha: 12.26%    
Sharpe Ratio: 9.00 EXCELLENT  
Portfolio Weighted Beta: 0.47    
CAGR: 456.23%    
AROC: 13.48%    
TROC: 4.29%    
Our 2022 Goal
2022 Dividend Goal: $4,800.00 31.06% In Progress
2022 Portfolio Value Goal: $151,638.03 67.56% In Progress
6-year Portfolio Value Goal: $175,000.00 58.54% In Progress
10-year Portfolio Value Goal: $1,000,000.00 10.24% In Progress

 

Dividend Investing and Trading Report

 
Last week we have received no dividends keeping our April’s dividend income at $60.83.

Last week, we have not purchased any dividend stock.

 

Here you can see our dividend income per stock holding:

 
Annual Dividend Payout week 15

 

Growth stocks Investing and Trading Report

 

Last week, we have not purchased any growth stocks.

Options Investing and Trading Report

 
Last week we rolled our strangle trades to keep our account safe.

These adjustments delivered income of $668.00 making our April options income $762.00.

 

We were actively trading our SPX strategy that delivered $445.00 gain.

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 have received $0.00 in dividends last week. Our portfolio currently yields 5.09% at $102,446.08 market value.

 
Our projected annual dividend income in 10 years is $52,235.61 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 $5,900.27 annual dividend income ($491.69 monthly income). We are 11.30% of our 10 year goal of $52,235.61 dividend income.

 
Future Divi on YOC week 15
 

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 decreased from $160,848.53 to $156,795.57 last week.

In 2022 we plan on accumulating dividend stocks, monetizing these positions, HFEA strategy, and SPX trading. We plan on raising more of our holdings to 100 shares so we can start selling covered calls. We continued rebalancing our options trades that released buying power significantly. That allowed us to start buying shares of our interest again.

 
Stock holdings trading week 15
 

Our goal is to accumulate 100 shares of dividend growth stocks we liked and then start selling covered calls or strangles around those positions. We also planned on reinvesting all dividends back into those holdings.
 

Investing and trading ROI

 

Our options trading delivered a 0.74% monthly ROI in April 2022, totaling a 17.56% ROI YTD. We hope that in 2022 we exceed our 45% annual revenue selling options against dividend stocks target, although as of today, we are getting behind this goal.

Our entire account is down -2.10%.
 

Our options trading averaged $4,498.50 per month this year. If this trend continues, we are on track to make $53,982.00 trading options in 2022. As of today, we have made $17,994.00 trading options.
 

Old SPX trades repair

 

Last week we have not adjusted any of our old trades. The market is playing with me. When all the ods looked good and I had a chance to get rid of one bad trade, the market tanked ruining my chance to improve the position. Now I am back at the beginning of my attempt to fix the old trade.

We however traded our SPX put credit spread strategy which you will be able to review in my next report. The SPX strategy held well so far, and our signals kept us away from opening new trades.

 

Market Outlook

 

The market’s bullish outlook changed quickly last week and we are back in the bearish territory. The odds of improving this market are now lesser and there is a higher possibility of going lower. We may still see a nice bounce next week but unless earnings season and better-than-great reports change the mood, this market is poised to go lower. If we get a bounce, it is likely going to be sold later.
 

If you want to find out more about the market outlook, 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 trading Net-Liq week 15

 

Account Stocks holding

 
TW Account holdings week 15
 

Last week, S&P 500 grew 52.02% since we opened our portfolio while our portfolio grew 17.72%. On YTD basis, the S&P 500 fell -12.75% and our portfolio -12.05%. We are outperforming the market although by a small percentage point.

The numbers above apply to our stock holdings only. Our overall account net-liq is down by -2.10% this year thanks to our options strategies that generated enough income to stay up a bit.
 

Stock holdings Growth YTD

 
TW Account holdings Growth YTD
 

Our stock holdings are starting to outperform the market. Hopefully, this trend will stay and we will be doing better than S&P 500 constantly.
 

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 10.24% 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 58.54% of that goal.
 

Our 2022 year goal is to grow this account to a $151,638.03 and today we accomplished 67.56% of this goal.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Trading Income week 15
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Trading Income week 15
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 15
 

We planned to make $4,800.00 in dividend income in 2022. As of today, we received $1,490.76. This is in line with our projected dividend 2022 goal. We also accumulated enough shares to start making $5,900.27 a year.
 

TW Received vs Future Dividends week 15

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return since we started tracking this metric.
 

TW cumulative (overall) trading return wk 15
 

Here is the cumulative return for the year 2022:
 

TW cumulative (2022) trading return wk 15
 

Our win ratio overall:
 

TW trading win ratio (overall) wk 15
 

Our win ratio for 2022:
 

TW trading win ratio (2022) wk 15
 

As of today, our account overall cumulative return is 8.90% (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.) and our 2022 cumulative return is -26.23%.

I have a favor to ask. If you like this report, please, hit the like like button button so I know that there is enough audience that like this content. Also if there is something you want to know or you want me to change this report to a different format, let me know in the comments section.

 
 




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Posted by Martin April 16, 2022
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2022 SPX put credit spreads trading review – week 15


Last week,the SPX PCS strategy finished down by -0.50% while SPX lost -2.13%. It was because we didn’t trade much. Our strategy is directional and we trade to the upside. When the market is bad, we stay away. From time to time, we take a bearish position (credit call spread) but in this market, it can be a dangerous side. We use credit call spreads to offset costs of rolling trades and they can bite us. Last week, we only adjusted our trades and if the market keeps being negative, we will most likely stay away and only monitor the existing trades.

Our overall SPX account is up +122.00% since the beginning of this program. However, we still have -$3,035 in unrealized losses. At some point, we will have to work hard to offset those losses.

We are also slightly adjusting our trading strategy due to extreme volatility and bearishness and pushing all deltas down. We will collect fewer premiums but stay safer. Once the markets calm down we may become more aggressive again.
 

Initial trade set ups

 

For my SPX strategy, I dedicated a $3,600 initial amount that will be used to trade SPX PCS strategy per week. If this amount is depleted, I will evaluate the strategy to determine whether to continue or change it. If I grow this amount, I will scale up the trading.
 

WHAT WILL WE TRADE?    
DAY DTE TYPE
MONDAY 7 DTE Put Credit Spread
TUESDAY 30 DTE Put Credit Spread
WEDNESDAY 7 DTE Put Credit Spread
FRIDAY 60 DTE Put Credit Spread
EVERY MONTH 120 DTE Put Debit Spread – HEDGE

 

Last week trading

 

Overall, the strategy resulted in a -$40.00 loss last week.
 

Initial account value (since inception: 12/07/2021): $3,600.00
Last week beginning value: $8,031.95
Last week ending value: $7,991.95 (-0.50%; total: +122.00%)
The highest capital requirements to trade this strategy: $19,160
Unrealized Gain: -$3,035 (-18.44%)
Realized Gain: $7,436 (+45.18%)
Total Gain: $4,401 (+26.74%)

 

SPX PCS account value
SPX PCS account value
 
Our SPX net-liq retreated a bit last week. The market is volatile too much and our trading activity will be adjusting our existing trades, and opening Friday’s trades, only. We will evaluate case by case which trade to take.
 

SPX PCS account vs SPX
SPX PCS account vs SPX index net liq
 
However, despite our muted trading activity, our account is outperforming the market so far and I hope that it will continue like that. We have a few trades that will need adjustments later during the year and I hope this market will eventually settle so the damage I expect will not be too bad.

 

SPX PCS account vs SPX
SPX PCS account vs SPX index
 

If you want to receive trade alerts whenever we open a new SPX put credit spread or a hedge trade, you can subscribe to our service:

 

 

Note, if you wish to subscribe to multiple levels, you can do so by subscribing to one level only and then send us an email that you want to be added to other levels too.

Also, if you like this report, hit the like button so I know there is enough audience wanting to see this type of report. If you have any questions or want to see anything else about my SPX trading, do not hesitate to contact me or write a comment in the comments section. Thank you!

 
 




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Posted by Martin April 11, 2022
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What’s with the AT&T (T)?


Wow, AT&T (T) crashed this morning more than 25% after the spinoff was finalized over the weekend. But then, the media told you that AT&T rallied almost 8% after the spinoff.

 
AT&T crash
 

So, what is wrong with this chart? How can the stock open below $19 a share when it closed above $23 a share the previous day on Friday and everybody calls it an 8% runup and a victory for AT&T?

There is not much information on this item but this seems to be a discrepancy and not a crash. A discrepancy due to spinoff when the media and their charting systems were not yet able to adjust the price for the spinoff.

So we need to wait a day or two to see what happens next. If the charts get adjusted (in a similar manner to a stock split) then this was a truly remarkable day for the AT&T stock. If the charts remain the same, then the old investors will get busted hard.

Nevertheless, I am happy that I got rid of this stock when it was trading at $30 a share.

But on the other hand, if this stock is truly trading at $19.63 a share, down from $23 a share, then the stock is down to its 20-year low and that could be a great opportunity to buy in:

 
AT&T crash opportunity
 

But, we need to wait for the brokers and chart services to update the data before we jump in.

Why do I think that this is just a discrepancy? It is because I still hold short strangles against AT&T and these were not adjusted. In fact, I cannot even adjust my positions as the options chains are not available. So we need to wait.
 




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Posted by Martin April 09, 2022
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2022 Week 14 investing and trading report


Our options trading was slow last week. We just adjusted our trades to keep them safe. Many of these trades were debit trades offsetting the credit ones. However, I was aggressively buying dividend and growth stocks and I feel really good about it as I think I bought at a good value.

Our net-liq dropped a bit last week as investors were freaking about a known issue – raising interest rates and FED more hawkish than a hawk. But it is all nonsense. All the things the markets are freaking about are known:
 

  • the war in Ukraine – known
  • high inflation – known
  • FED raising the rates – known
  • FED being overly hawkish – known
  • High yields – known
  • Yield curve inversion – known
     

All is known, so the selling pressure is most likely just fear created by big money to scare retail investors into selling while they are buying. But time will show. I am keeping my powder dry for more buying.

 

Here is our investing and trading report:

 

Account Value: $108,477.66 -$4,347.97 -4.01%
Options trading results
Options Premiums Received: $59.00    
01 January 2022 Options: $8,885.00 +8.36%  
02 February 2022 Options: $10,009.00 +10.34%  
03 March 2022 Options: -$1,662.00 -1.47%  
04 April 2022 Options: $94.00 +0.09%  
Options Premiums YTD: $17,326.00 +15.97%  
Dividend income results
Dividends Received: $36.23    
01 January 2022 Dividends: $303.38    
02 February 2022 Dividends: $732.81    
03 March 2022 Dividends: $393.74    
04 April 2022 Dividends: $60.83    
Dividends YTD: $1,490.76    
Portfolio metrics
Portfolio Yield: 5.02%    
Portfolio Dividend Growth: 11.61%    
Ann. Div Income & YOC in 10 yrs: $50,883.75 32.61%  
Ann. Div Income & YOC in 20 yrs: $1,501,776.07 962.44%  
Ann. Div Income & YOC in 25 yrs: $24,594,972.65 15,762.15%  
Ann. Div Income & YOC in 30 yrs: $1,299,076,593.10 832,537.38%  
Portfolio Alpha: 10.63%    
Sharpe Ratio: 1.96 ACCEPTABLE  
Portfolio Weighted Beta: 0.48    
CAGR: 473.10%    
AROC: 12.42%    
TROC: 8.65%    
Our 2022 Goal
2022 Dividend Goal: $4,800.00 31.06% In Progress
2022 Portfolio Value Goal: $151,638.03 71.54% In Progress
6-year Portfolio Value Goal: $175,000.00 61.99% In Progress
10-year Portfolio Value Goal: $1,000,000.00 10.85% In Progress

 

Dividend Investing and Trading Report

 
Last week we have received $36.23 in dividends bringing April’s dividend income to $60.83.


Last week, we bought these dividend growth stocks:
 

  • 43 shares of CSQ @ $17.69
  • 20 shares of RYLD @ $24.02
  • 30 shares of TRIN @ $17.91
  • 2 shares of AAPL @ $175.85
  • 40 shares of BAC @ $39.26
  • 10 shares of O @ $71.34
  • 20 shares of WBA @ $43.12
  • 20 shares of OHI @ $28.49
  • 3 shares of CLX @ $144.70
     

If the market keeps going lower, I will be adding more shares to our portfolio.

Here you can see our dividend income per stock holding:

 
Annual Dividend Payout week 14

 

Growth stocks Investing and Trading Report

 


Last week we bought the following growth stocks and funds:
 

  • 20 shares of TMUS @ $131.48
  • 10 shares of SPXL @ $122.71
  • 15 shares of CROX @ $68.96
     

Options Investing and Trading Report

 
Last week we rolled our strangle trades to keep our account safe.

These adjustments delivered income of $59.00 making our April options income $94.00.

 

We were actively trading our SPX strategy that delivered $445.00 gain.

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 have received $36.23 in dividends last week. Our portfolio currently yields 5.02% at $108,477.66 market value.

 
Our projected annual dividend income in 10 years is $50,883.75 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 $5,900.27 annual dividend income ($491.69 monthly income). We are 11.60% of our 10 year goal of $50,883.75 dividend income.

 
Future Divi on YOC week 14
 

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 $154,449.47 to $160,848.53 last week.

In 2022 we plan on accumulating dividend stocks, monetizing these positions, HFEA strategy, and SPX trading. We plan on raising more of our holdings to 100 shares so we can start selling covered calls. We continued rebalancing our options trades that released buying power significantly. That allowed us to start buying shares of our interest again.

 
Stock holdings trading week 14
 

Our goal is to accumulate 100 shares of dividend growth stocks we liked and then start selling covered calls or strangles around those positions. We also planned on reinvesting all dividends back into those holdings.
 

Investing and trading ROI

 

Our options trading delivered a 0.09% monthly ROI in April 2022, totaling a 15.97% ROI YTD. We hope that in 2022 we exceed our 45% annual revenue selling options against dividend stocks target, although as of today, we are getting behind this goal.

Our entire account is up +3.66%.
 

Our options trading averaged $4,331.50 per month this year. If this trend continues, we are on track to make $51,978.00 trading options in 2022. As of today, we have made $17,326.00 trading options.
 

Old SPX trades repair

 

Last week we have adjusted one of our old trades rolling it more into the future. Now we have to trade. Now we will be waiting.

We however traded our SPX put credit spread strategy which you will be able to review in my next report. The SPX strategy held well so far, and our signals kept us away from opening new trades.

 

Market Outlook

 

The stock market pulled back a bit last week which in my opinion could be expected after a strong rally. Now the question is whether this pullback turns into something more serious or not. I will be describing possible options in my weekly newsletter. A week ago, the market looked very bullish but last week, one FED official (that cannot agree on the color of an orange) opened her mouth and said something that spooked the market. Now everybody is bearish again. But I think it is the wrong side to be bearish.
 

If you want to find out more about the market outlook, 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 trading Net-Liq week 14

 

Account Stocks holding

 
TW Account holdings week 14
 

Last week, S&P 500 grew 55.16% since we opened our portfolio while our portfolio grew 19.76%. On YTD basis, the S&P 500 fell -9.61% and our portfolio -10.01%. We are underperforming the market although by a small percentage point.

The numbers above apply to our stock holdings only. Our overall account net-liq is up by 3.66% this year thanks to our options strategies that generated enough income to stay up a bit.
 

Stock holdings Growth YTD

 
TW Account holdings Growth YTD
 

Our stock holdings are starting to outperform the market. Hopefully, this trend will stay and we will be doing better than S&P 500 constantly.
 

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 10.85% 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 61.99% of that goal.
 

Our 2022 year goal is to grow this account to a $151,638.03 and today we accomplished 71.54% of this goal.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Trading Income week 14
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Trading Income week 14
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 14
 

We planned to make $4,800.00 in dividend income in 2022. As of today, we received $1,490.76. This is in line with our projected dividend 2022 goal. We also accumulated enough shares to start making $5,900.27 a year.
 

TW Received vs Future Dividends week 14

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return since we started tracking this metric.
 

TW cumulative (overall) trading return wk 14
 

Here is the cumulative return for the year 2022:
 

TW cumulative (2022) trading return wk 14
 

Our win ratio overall:
 

TW trading win ratio (overall) wk 14
 

Our win ratio for 2022:
 

TW trading win ratio (2022) wk 14
 

As of today, our account overall cumulative return is 15.31% (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.) and our 2022 cumulative return is -21.89%.

I have a favor to ask. If you like this report, please, hit the like like button button so I know that there is enough audience that like this content. Also if there is something you want to know or you want me to change this report to a different format, let me know in the comments section.

 
 




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Posted by Martin April 09, 2022
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2022 SPX put credit spreads trading review – week 14


Last week,the SPX PCS strategy finished up by +5.87% while SPX lost -1.27%. Our overall SPX account is up +123.11% since the beginning of this program. However, we still have -$3,035 in unrealized losses. At some point we will have to work hard to offset those losses.

We are also slightly adjusting our trading strategy due to extreme volatility and pushing all deltas down to delta 14 – 15 only. We will collect fewer premiums but stay safer. Once the markets calm down we may become more aggressive again.
 

Initial trade set ups

 

For my SPX strategy, I dedicated a $3,600 initial amount that will be used to trade SPX PCS strategy per week. If this amount is depleted, I will evaluate the strategy to determine whether to continue or change it. If I grow this amount, I will scale up the trading.
 

WHAT WILL WE TRADE?    
DAY DTE TYPE
MONDAY 7 DTE Put Credit Spread
TUESDAY 30 DTE Put Credit Spread
WEDNESDAY 7 DTE Put Credit Spread
FRIDAY 60 DTE Put Credit Spread
EVERY MONTH 120 DTE Put Debit Spread – HEDGE

 

Last week trading

 

Overall, the strategy resulted in a $445.00 gain last week. Note that the gain might be unrealized as some or all trades may be still open. We also have quite a few credit call spreads that will give us some hard time in the near future as the market will go higher and we will have to roll them but overall, I expect good returns.
 

Initial account value (since inception: 12/07/2021): $3,600.00
Last week beginning value: $7,586.95
Last week ending value: $8,031.95 (+5.87%; total: +123.11%)
The highest capital requirements to trade this strategy: $19,160
Unrealized Gain: -$3,035 (-18.44%)
Realized Gain: $7,382 (+44.85%)
Total Gain: $4,347 (+26.41%)

 

SPX PCS account value
SPX PCS account value
 
Our SPX net-liq grew up again last week. The market is volatile too much so we might be adjusting our existing trades and take Friday’s trades only. We will evaluate case by case which trade to take.
 

SPX PCS account vs SPX
SPX PCS account vs SPX index net liq
 
Our account is outperforming the market so far and I hope that it will continue like that. We have a few bearish expectations and panic still rattling the markets so, we need to slow down a bit to be prepared for any eventuality that this market will go lower and retest the lows.

 

SPX PCS account vs SPX
SPX PCS account vs SPX index
 

If you want to receive trade alerts whenever we open a new SPX put credit spread or a hedge trade, you can subscribe to our service:

 

 

Note, if you wish to subscribe to multiple levels, you can do so by subscribing to one level only and then send us an email that you want to be added to other levels too.

Also, if you like this report, hit the like button so I know there is enough audience wanting to see this type of report. If you have any questions or want to see anything else about my SPX trading, do not hesitate to contact me or write a comment in the comments section. Thank you!

 
 




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