Weekly Newsletter   Challenge account


Posted by Martin August 07, 2021
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2021 Weeks 30 & 31 investing and trading report


July 2021 is behind us and we can close the books for week #30. We can also report our first week of August 2021 (week #31). I was on vacation last week of July and I was not able to report July trading, so I will do so here.

Last week of July we received $537.00 of options premiums ending the month of July at $3,865.00 total premiums received. Our dividend income brought in $56.95 finishing the month at $228.62.

Below is our August week #31 report.
 

Here is our investing and trading report:

 

Account Value: $77,024.88 $1,885.18 2.51%
Options trading results
Options Premiums Received: $527.00    
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: $527.00 +0.68%  
Options Premiums YTD: $32,102.00 +41.68%  
Dividend income results
Dividends Received: $7.28    
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: $7.28    
Dividends YTD: $899.44    
Portfolio metrics
Portfolio Yield: 4.70%    
Portfolio Dividend Growth: 8.13%    
Ann. Div Income & YOC in 10 yrs: $17,666.52 18.95%  
Ann. Div Income & YOC in 20 yrs: $155,096.04 166.38%  
Ann. Div Income & YOC in 25 yrs: $738,559.26 792.29%  
Ann. Div Income & YOC in 30 yrs: $5,653,530.69 6,064.83%  
Portfolio Alpha: 34.44%    
Portfolio Weighted Beta: 0.69    
CAGR: 716.27%    
AROC: 43.27%    
TROC: 19.06%    
Our 2021 Goal
2021 Dividend Goal: $1,071.42 83.95%  
2021 Portfolio Value Goal: $42,344.06 181.90% Accomplished

 

Dividend Investing and Trading Report

 
Last week, we have received a $7.28 dividends income. According to our holdings currently on our balance sheet, all stocks should generate $4,082.46 annual dividend income. We are not receiving these dividends yet because many of the stocks were purchased recently and we missed their most recent dividends. But next year, we should be receiving the full amount.

The chart below indicates our current annual dividend payout from our dividend stock holdings.

Last week, our dividend income reached 83.95% of our dividend income goal.

 
Annual Dividend Payout week 31
 

Options Investing and Trading Report

 
Last week we rolled options that got in trouble. We were not opening any new trades. Just managing the old ones. We rolled OXY, PBCT, XOM, TSLA, AES, and BA. The purpose of rolling those trades was to move the stock price to the center of the strangle. That releases a significant amount of buying power. These adjustments also delivered nice credits.
 

You can watch all our trades in this spreadsheet and you can also subscribe to our newsletter for our trade alerts.
 

Expected Future Dividend Income

 
As the table at the beginning of this report indicates, our aggressive dividend growth stocks accumulation is starting to show significant progress in our future dividends income. Our portfolio dividend yield and dividend growth will be bringing us almost $155,096.04 in 20 years and $5,653,530.69 in 30 years. I wish, I had that $5.6 million income now. But that is the fate of dividend growth investing. It is not a quick rich scheme and building an account takes time.

We will keep aggressively accumulating dividend growth stocks to generate liveable income sooner than in 20 years. And the portfolio is starting to show this to be happening. In just 10 years, we will start receiving $17,666.52 in today’s dollars. It is not bad considering that in March 2021 it was only $3,202.52 in projected future dividends.

 
Future Divi on YOC week 31
 

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 $97,113.20 to $100,173.83.

Our holdings reached $100k market value. It is a good milestone to celebrate.

 
Stock holdings week 31
 

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 0.68% monthly ROI in July 2021, totaling a 41.68% ROI YTD. We are getting close to our 45% annual revenue selling options against dividend stocks!

Our account grew by 274.41% this year despite very slow growth in June and July.
 

Our options trading averaged $4,012.75 per month this year. If this trend continues, we are on track to make $48,153.00 trading options in 2021. As of today, we have made $32,102.00 trading options. We are halfway to the projected annual income.
 

Old SPX trades repair

 

This week, we didn’t adjust any SPX trade.

 

Accumulating Growth Stocks

 

Last week, we added 1 share of SNOW to our holdings. Our goal is to accumulate 100 shares and start selling covered calls. SNOW is an expensive stock to trade naked strangles, so we will proceed with covered calls once we accumulate enough shares. As of today, we hold 21 shares.

 

Accumulating Dividend Growth Stocks

 

Last week, we added 10 shares of VICI, and 15 shares of ICSH. In the upcoming weeks, we will be accumulating aggressively the higher yield income stocks to boost our dividend income furthermore.

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

 

I am still bullish and think this market is going higher in the upcoming weeks. The reason? Earnings! No matter what you believe about the current market valuation, this market is heading higher because of earnings. What location is for real estate valuations, earnings is the most important metric for the stock market.

And the second quarter of earnings was spectacular. On a per-share basis, earnings grew from an expected 205 per share to 255 per share. That translates to a $5,533 SPX value. At today’s prices, we have a lot of room to go higher.

 

Investing and trading report in charts

 

Account Net-Liq

 

TW Account Net-Liq week 31

 

Account Stocks holding

 
TW Account holdings week 31
 

Our stock holdings still do not beat the market. However, I expect it to change over time. S&P 500 grew 53.37% since we opened our portfolio while our portfolio grew 19.18% only. On YTD basis, the S&P 500 grew 23.52% and our portfolio 12.20%.

But the numbers above apply to our stock holdings in our account, not the overall account net-liq growth. Our overall account beats the market growing by 274.41%!
 

Stock holdings Growth YTD

 
TW Account holdings Growth YTD
 

I expect our stock holdings to start outperforming the market as they mature. However, these are just our stock holdings. The entire portfolio beats the market by far thanks to monetizing those positions.

Our goal is to grow this account to $1,000,000.00 value in ten years. We are in year two.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Income week 31
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Income week 31
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 31
 

We are on track to accomplish our dividend income goal, currently, we are at 83.95% of the goal to reach $1,071 of dividend income this year. Currently, we accumulated enough shares to receive $4,082.46 in annual dividends if we have held through the entire dividend cycle.
 

TW Received vs Future Dividends week 31

The chart above is the corrected chart comparing the projected MONTHLY dividend income vs received dividend income. And again, the projected dividend income is based on the stock holdings up to date. That is the income we would have received if we have held over the entire dividend cycle.

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return. It shows how the last week’s selloff shook down our returns but we are recovering along with the market.
 

TW cumulative return wk 31
 

TW win ratio wk 31
 

As of today, our account cumulative return is 34.23% (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 exceeded our expectations. I hope, the rest of the month will be even better.

We will continue accumulating the dividend growth stocks in our portfolio to reach 100 shares. We will also replenish our cash reserves to bring them back to 25% of our current net-liq value.

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




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Posted by Martin July 24, 2021
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2021 Week 29 investing and trading report


The third week of July is behind us. I am on a vacation and it is really difficult to do anything when you have to attend family and invest as well, so this investing and trading report took a bit more time to complete than usual. My next week will be probably late too.

Last week’s investing and trading were good. We made nice options premiums income receiving $1,245.00 and OK dividend income making $14.27. Out net-liq was stangating, though. But let’s quickly review the last week’s report.
 

Here is our investing and trading report:

 

Account Value: $73,739.67 $5.68 0.01%
Options trading results
Options Premiums Received: $1,245.00    
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%  
05 June 2021 Options: $4,677.00 +6.37%  
06 July 2021 Options: $3,328.00 +4.51%  
Options Premiums YTD: $31,038.00 +42.09%  
Dividend income results
Dividends Received: $14.27    
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    
06 July 2021 Dividends: $171.67    
Dividends YTD: $835.21    
Portfolio metrics
Portfolio Yield: 4.67%    
Portfolio Dividend Growth: 8.47%    
Ann. Div Income & YOC in 10 yrs: $17,811.10 19.50%  
Ann. Div Income & YOC in 20 yrs: $169,834.32 185.93%  
Ann. Div Income & YOC in 25 yrs: $876,830.08 959.91%  
Ann. Div Income & YOC in 30 yrs: $7,612,835.00 8,334.19%  
Portfolio Alpha: 34.65%    
Portfolio Weighted Beta: 0.71    
CAGR: 729.45%    
AROC: 31.69%    
TROC: 19.94%    
Our 2021 Goal
2021 Dividend Goal: $1,071.42 77.95%  
2021 Portfolio Value Goal: $42,344.06 174.14% Accomplished

 

Dividend Investing and Trading Report

 
Last week, we have received a $14.27 dividends income. According to our holdings currently on our balance sheet, all stocks should generate $4,110.62 annual dividend income. We are not receiving these dividends yet because many of the stocks were purchased recently and we missed their most recent dividends. But next year, we should be receiving the full amount.

The chart below indicates our current annual dividend payout from our dividend stock holdings.

Last week, our dividend income reached 77.95% of our dividend income goal.

 
Annual Dividend Payout week 29
 

Options Investing and Trading Report

 
Last week we reopened all trades that expired the previous week. We opened new strangles against APAM, AES, KBE, O, PPL, and OXY. We rolled a few existing trades, and we opened a new long LEAPS trade against SPLG. We also started selling covered calls against that LEAPS option.

The new trades and adjustments delivered $1,245.00 options premiums last week.
 

You can watch all our trades in this spreadsheet and you can also subscribe to our newsletter for our trade alerts.
 

Expected Future Dividend Income

 
As the table at the beginning of this report indicates, our aggressive dividend growth stocks accumulation is starting to show significant progress in our future dividends income. Our portfolio dividend yield and dividend growth will be bringing us almost $169,834.32 in 20 years and $7,612,835.00 in 30 years. I wish, I had that $7 million income now. But that is the fate of dividend growth investing. It is not a quick rich scheme and building an account takes time.

We will keep aggressively accumulating dividend growth stocks to generate liveable income sooner than in 20 years. And the portfolio is starting to show this to be happening. In just 10 years, we will start receiving $17,811.10 in today’s dollars. It is not bad considering that in March 2021 it was only $3,202.52 in projected future dividends.

 
Future Divi on YOC week 29
 

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 $94,437.23 to $97,113.20.

 
Stock holdings week 29
 

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 4.51% monthly ROI in July 2021, totaling a 42.09% ROI YTD. We are getting close to our 45% annual revenue selling options against dividend stocks!

Our account grew by 258.44% this year despite very slow growth in June and July.
 

Our options trading averaged $4,434.00 per month this year. If this trend continues, we are on track to make $53,208.00 trading options in 2021. As of today, we have made $31,038.00 trading options. We are halfway to the projected annual income.
 

Old SPX trades repair

 

This week, we didn’t adjust any SPX trade.

 

Accumulating Growth Stocks

 

Last week, we didn’t add any positions.

 

Accumulating Dividend Growth Stocks

 

Last week, we added 50 shares of QYLD, and 15 shares of ICSH. In the upcoming weeks, we will be accumulating aggressively the higher yield income stocks to boost our dividend income furthermore.

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.

 

Investing and trading report in charts

 

Account Net-Liq

 

TW Account Net-Liq week 28

 

Account Stocks holding

 
TW Account holdings week 29
 

Our stock holdings still do not beat the market. However, I expect it to change over time. S&P 500 grew 52.51% since we opened our portfolio while our portfolio grew 18.05% only. On YTD basis, the S&P 500 grew 22.67% and our portfolio 11.07%.

But the numbers above apply to our stock holdings in our account, not the overall account net-liq growth. Our overall account beats the market growing by 258.44%!
 

Stock holdings Growth YTD

 
TW Account holdings Growth YTD
 

I expect our stock holdings to start outperforming the market as they mature. However, these are just our stock holdings. The entire portfolio beats the market by far thanks to monetizing those positions.

Our goal is to grow this account to $1,000,000.00 value in ten years. We are in year two.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Income week 29
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Income week 29
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 29
 

We are on track to accomplish our dividend income goal, currently, we are at 77.95% of the goal to reach $1,071 of dividend income this year. Currently, we accumulated enough shares to receive $4,110.62 in annual dividends if we have held through the entire dividend cycle.
 

TW Received vs Future Dividends week 29

The chart above is the corrected chart comparing the projected MONTHLY dividend income vs received dividend income. And again, the projected dividend income is based on the stock holdings up to date. That is the income we would have received if we have held over the entire dividend cycle.

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return. It shows how the last week’s selloff shook down our returns but we are recovering along with the market.
 

TW cumulative return wk 29
 

TW win ratio wk 29
 

As of today, our account cumulative return is 28.51% (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 exceeded our expectations. I hope, the rest of the month will be even better.

We will continue accumulating the dividend growth stocks in our portfolio to reach 100 shares. We will also replenish our cash reserves to bring them back to 25% of our current net-liq value.

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




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Posted by Martin July 18, 2021
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2021 Week 28 investing and trading report


Another week of July is over and it is time to provide our weekly investing and trading report for our main business account. We run two accounts – one account is our main business account where we trade options against dividend stocks we either own or plan on owning. Our second account is a challenge account that is designed for beginning investors starting with little money to invest and grow their account from $100 to $75,000. We provide a report of our business account (the main account) every Saturday on weekly basis and we provide our challenge account review every month on Monday evening at the beginning of each month.
 

Closing strangles positions

 
When we open a new strangle trade as I wrote about last week our main goal is to keep that trade running all the way to expiration. If everything goes well and the stock doesn’t move violently to either side, we let it go and let it expire.

Sometimes, the stock runs up or down hard, and either our call or put side gets challenged. That is the time we start watching our position carefully and if any of this situation happens we roll the trade:
&nbs;

The challenged side gets beyond delta 30

 

In this case, we review how much buying power would be released if we roll the trade. If the roll releases $800, $1,000, $2,000, or more of the buying power, we will roll the trade. But it must be a roll for credit. If a rolling trade would result in a debit trade, we would probably let it go and accept the assignment. But if the trade was naked and we do not have enough cash (or 100 shares) to accept the assignment, we roll farther away in time to make sure the trade will bring in credit, even a small one.
&nbs;

The challenged side gets in the money

 

A stock drops so fast that we are unable to roll soon enough to keep the price between the strikes. In this case, we roll the trade for sure. We roll lower (or higher) and away in time. If the stock was near the money or at the money (but still in the money), we can wait a bit or we can roll in the next expiration day, and we roll the challenged side out of the money. But again, such rolling must result in a credit. If the next expiration day rolling still requires debit, we go further away in time and we go as far away as it turns from a debit trade to credit trade.

The challenged side gets deep in the money

 

If the stock gets deep in the money due to a market selloff, we again do the exact same moves as described above but we do not go into the next expiration day. We go to 90 DTE or farther away. Why? We want to avoid early assignments. We then maintain that trade at 90 DTE or farther until we are able to roll the trade closer to the money. In order to roll deep in the money strangle, we sometimes have to change the trade to a staddle (meaning we bring the trade calls and puts strikes together). That helps in rolling the trade away for credit.
trade.

None of the above helps

 

If none of the above-mentioned strategies help, for example rolling would require adding more money or more buying power at the bad trade, we then take assignments. But if we do not have enough cash for put assignment, we start rolling the trade away in time as is. No changing of strikes, only moving it away in time. Usually, the opposite side brings in enough credit to offset the cost of the challenged side. This buys us time to accumulate cash and take a stock assignment. If it is a call side, we start hedging the trade by buying shares to cover the call side. If this is not feasible (for example our call strike is at $30 a share and the stock is trading at $100 a share then hedging makes no sense. In this case, I add a put and sell 2 puts to roll 1 call. It is a kinda uneven strangle. But it takes planning, releasing cash for the new obligations. If your account is stressed, then just roll until you are ready to let it go (or the market decides to work with you, and the stock retreats and allows you to roll up (or get out).
trade.

Just do it

 
When doing all these adjustments, you must do it. You must try it. I always play with those adjustments, meaning I am simulating them. I do not place those trades but I simulate the adjustments to see what the trade would look like and what the result would look like if I do that adjustment. When I am happy with what I see, I do it. If not, I rather wait. It’s a game and you have to play it. If you are not sure, just roll the entire trade away as is – same strikes just longer expiration until you find a solution you like.

As I said a few times before, options are a fluid trading vehicle. No rules are set in stone. The best way to find a solution to a bad trade is to play with it. What worked once may not work again this time and something else would work better.

 

Here is our investing and trading report:

 

Account Value: $73,733.99 -$254.28 -0.34%
Options trading results
Options Premiums Received: $719.00    
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%  
05 June 2021 Options: $4,677.00 +6.37%  
06 July 2021 Options: $2,083.00 +2.83%  
Options Premiums YTD: $29,793.00 +40.41%  
Dividend income results
Dividends Received: $23.55    
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    
06 July 2021 Dividends: $157.40    
Dividends YTD: $820.94    
Portfolio metrics
Portfolio Yield: 4.69%    
Portfolio Dividend Growth: 8.47%    
Ann. Div Income & YOC in 10 yrs: $17,602.81 19.67%  
Ann. Div Income & YOC in 20 yrs: $169,107.79 189.00%  
Ann. Div Income & YOC in 25 yrs: $878,423.27 981.73%  
Ann. Div Income & YOC in 30 yrs: $7,689,838.06 8,594.24%  
Portfolio Alpha: 32.92%    
Portfolio Weighted Beta: 0.72    
CAGR: 744.27%    
AROC: 31.64%    
TROC: 19.63%    
Our 2021 Goal
2021 Dividend Goal: $1,071.42 76.62%  
2021 Portfolio Value Goal: $42,344.06 174.13% Accomplished

 

Dividend Investing and Trading Report

 
Last week, we have received a $23.55 dividends income. We feel that the income will be growing faster as more of our holdings mature and become eligible for dividend payouts. According to our holdings currently on our balance sheet, all stocks should generate $4,044.00 annual dividend income. It is not as of yet because many of the stocks were purchased recently and we missed their dividend. But next year, we should be receiving the full amount.

The chart below indicates our current annual dividend payout from our dividend stock holdings.

Last week, our dividend income reached 76.62% of our dividend income goal.

 
Annual Dividend Payout week 28
 

Options Investing and Trading Report

 
Last week we rolled a few trades to release a stressed buying power in our account. We rolled TSLA, SPCE, SPX, BA, AAPL, CROX, CSCO, MU, TSN, OXY, DKNG, and IJS. These trades are now in good shape and some were ready to expire worthless for a full profit.

We opened new trades against QYLD (short put), and PMT (short put).

We had 8 trades that expired on Friday:
 

1 PPL Jul16 26 put / 30 call strangle for 1.47 credit
1 KBE Jul16 47 put / 61 call strangle for 0.80 credit
1 KBE Jul16 54 covered call for 0.27 credit
1 APAM Jul16 45 put / 55 call strangle for 1.60 credit
1 AES Jul16 23 put / 27 call strangle for 0.55 credit
1 SNOW Jul16 295/300 call credit spread for 1.49 credit
1 OXY Jul16 25 put / 33 call strangle for 0.52 credit
1 O Jul16 65 put for 0.37 credit

 

We will be reopening these trades during the next week or two.

The new trades and adjustments delivered $719.00 options premiums last week.
 

You can watch all our trades in this spreadsheet and you can also subscribe to our newsletter for our trade alerts.
 

Expected Future Dividend Income

 
As the table at the beginning of this report indicates, our aggressive dividend growth stocks accumulation is starting to show significant progress in our future dividends income. Our portfolio dividend yield and dividend growth will be bringing us almost $169,107.79 in 20 years and $7,689,838.06 in 30 years. I wish, I had that $7 million income now. But that is the fate of dividend growth investing. It is not a quick rich scheme and building an account takes time.

We will keep aggressively accumulating dividend growth stocks to generate liveable income sooner than in 20 years. And the portfolio is starting to show this to be happening. In just 10 years, we will start receiving $17,602.81 in today’s dollars. It is not bad considering that in March 2021 it was only $3,202.52 in projected future dividends.

 
Future Divi on YOC week 28
 

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 $93,468.90 to $94,437.23. Last week, we added 50 shares of QYLD, 10 shares to ICSH, 1 share of SNOW, and 20 shares to PMT.

We use ICSH as a savings account and as of today, we are mostly in a preservation mode. We feel like our balance sheet is way aggressive and has no cash reserves. Therefore, we are mostly adding money to our cash reserves.

 
Stock holdings week 28
 

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 2.83% monthly ROI in July 2021, totaling a 40.41% ROI YTD. We are getting close to our 45% mark!

Our account grew by 258.41% this year despite very slow growth in June and July. I suggest the growth was suppressed by the market volatility and options trades increasing their maintenance requirements that ate the net-liq value. Once the options expire (hopefully) the net liquidating value will go up faster.
 

Our options trading averaged $4,256.14 per month this year. If this trend continues, we are on track to make $51,073.71 trading options in 2021. With the income of $29,793.00 to date, we are half way to this projected income.
 

Old SPX trades repair

 

This week, we rolled our old SPX trades way higher and away in time. I am not yet decided what to do with these positions. My original plan to try to roll it out of the money doesn’t work. So, I am now thinking to keep the trades rolling until I will be able to apply for portfolio margin and convert these Condors into strangles. With a portfolio margin, I will only need about $10,000 buying power per strangles. With a Reg-T margin, I need $55,000 buying power. Not feasible to trade under such circumstances.

 

Accumulating Growth Stocks

 

Last week, we added 1 share to our SNOW position.

 

Accumulating Dividend Growth Stocks

 

Last week, we added 50 shares of QYLD, 10 shares of ICSH, and 20 shares of PMT to our dividend growth positions. In the upcoming weeks, we will be accumulating aggressively the higher yield income stocks to boost our dividend income furthermore.

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

 

The market was going up last week and it reached (almost) our price target. It got close to it. But that move upwards was not very convincing. It was in fact very weak move and we had a few hiccups on the road up. A week ago, the market dropped on inflation fears but recovered quickly just to lose it all again at the end of this week.

 
SPX July 18 2021 outlook
 

The market is looking for direction. And this trend may continue for a week or two. We may also see a correction of 10% (more or less). And honestly, even though the market may continue higher, I am more and more in favor of seeing a correction sparked by inflation fears.

But I am in the FED camp, or Jerome Powell’s camp, who insists that the inflation is transitory. I agree with that. I agree with renowned economist Lacy Hunt who says inflation is transitory and typical to recovering economies. We had a spike in inflation after every recession. We had a spike in inflation in 2009 after the economy started recovering from the Great Recession and people were predicting another crash. Remember that? Many were predicting a crash all the way until 2013-2014! But that never materialized.

Inflation doesn’t cause a recession. It is an effect of a recession. When businesses came to life after March 2020 40% crash boosted by the US government support and people receiving stimulus checks (in a similar manner as we experienced in 2009) it is obvious that there would be a spike in inflation. And there will be the same exact doom and gloom talk about it.

I still remember some pundits saying in 2009 – 2013 that this would all end badly because FED lowered interest rates to zero, started a huge QE program, and as interest rates started skyrocketing FED would have nothing left to fight it off. Well, 13 years later, history repeats itself.

Here is a video of an interview with Lacy Hunt and his excellent presentation. I would like you to watch it. It will give you a great insight into the economic behavior around recessions. How GDP behaves? Money flow and money supply? Inflation? We have experienced it all in 2009 and people already forgot.

 

 

So, if you see the market selling off on fear of inflation, buy. It is a dip that will leave naysayers and doom predictors biting the dust.

But, this doesn’t mean that the market will not sell-off. As I mentioned above, I expect it to cool off a bit. I expect it to retest our previous breakout and go lower to a $4,250 level. It may be just a one-day dip, quick and fast, that would recover quickly, or it may not materialize at all.

 
SPX July 18 2021 outlook
 

One reason for this expectation not happening is simple – earnings, earnings, earnings. And we just started another earnings season and so far, the companies are beating it. And as in real estate, location is the most important factor driving prices, in the stock market, it is earnings. And the market trails the earnings predictions so far. When we see earnings going down, expect problems:

 
SPX earnings 2021 outlook 28
 

Based on these estimates, the SPX should be trading at $3,394.00, 27% lower than today, and based on the future earnings estimate, the SPX intrinsic value is at $4,119.36 (5% below the current price). The stock market is pricing the price range to be at $4,080.00 and 4575.00. With this cold market looking for a direction, it is difficult to say where it wants to go.

 

Investing and trading report in charts

 

Account Net-Liq

 

TW Account Net-Liq week 28

 

Account Stocks holding

 
TW Account holdings week 28
 

Our stock holdings still do not beat the market. However, I expect it to change over time. S&P 500 grew 49.59% since we opened our portfolio while our portfolio grew 16.39% only. On YTD basis, the S&P 500 grew 19.74% and our portfolio 9.41%.

But the numbers above apply to our stock holdings in our account, not the overall account net-liq growth. Our overall account beats the market growing by 258.41%!
 

Stock holdings Growth YTD

 
TW Account holdings Growth YTD
 

I expect our stock holdings to start outperforming the market as they mature. However, these are just our stock holdings. The entire portfolio beats the market by far thanks to monetizing those positions.

Our goal is to grow this account to $1,000,000.00 value in ten years. We are in year two.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Income week 28
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Income week 28
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 28
 

We are on track to accomplish our dividend income goal, currently, we are at 76.62% of the goal to reach $1,071 of dividend income this year. Currently, we accumulated enough shares to receive $4,044.00 in annual dividends if we have held through the entire dividend cycle.
 

TW Received vs Future Dividends week 28

The chart above is the corrected chart comparing the projected MONTHLY dividend income vs received dividend income. And again, the projected dividend income is based on the stock holdings up to date. That is the income we would have received if we have held over the entire dividend cycle.

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return. It shows how the last week’s selloff shook down our returns but we are recovering along with the market.
 

TW cumulative return wk 28
 

As of today, our account cumulative return is 28.50% (since March 13, 2021).

 

Conclusion of our investing and trading report

 

This week our options trading exceeded our expectations. I hope, the rest of the month will be even better.

We will continue accumulating the dividend growth stocks in our portfolio to reach 100 shares. We will also replenish our cash reserves to bring them back to 25% of our current net-liq value.

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




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Posted by Martin July 10, 2021
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2021 Week 27 investing and trading report


We are in the second week of July 2021. The stock market was volatile a bit when the investors started freaking about a problem that just about two or three weeks ago was no problem at all. As you will see in this week’s investing and trading report, we took trading this week lightly and we went on preserving cash. We made $1,364.00 trading options last week, we received $133.85 in dividends, and our net-liq grew to $73,988.27, a difference of $513.04 and 0.70% growth this month.
 

Selling strangles rules

 
A few members and investors asked me this question last week. “What are your criteria to choose your put strikes and how do you manage the trade?” In this part of the report, I will try to describe how I construct my trades.

Remember, though, options are a very fluid beast. It is not easy to make rules set in stone and believe you have created a holy grail of trading. It doesn’t work that way. There will be many moving parts you need to take into account and eventually break your rule. But it is not breaking the rule so to speak, it is more like modifying the rule.
 

First

First, you need a list of stocks you will be trading around them. If you go to my trading spreadsheet, all the trades you would see there are against stocks that were pre-selected and I placed them in my watch list before. None of my trade is ad hoc trade. All stocks are screened, evaluated, and I played with them a lot, meaning tried to place simulating trades, and analyzing trades to see how the stock behaves, how it can be rolled, what strikes does it offer, etc. No stocks in my watch list are an accident.
 

Second

What criteria must be met by my stocks? It is easy. You need to know what stocks you want to be investing in. That’s why I advocate that you must be an investor first. Then a trader. As an investor, I can choose stocks I want to own.

What stocks do I want to own? If you follow my blog a bit longer than just reading this post, you already know. I want to own dividend growth stocks. Yes, I also want to own some speculative stocks such as SNOW or TSLA. But primarily, I want to own dividend growth stocks (or also high-yielding dividend stocks). And all my trading revolves around these stocks.

So, the stock must pay a dividend.
The stock must grow the dividend.
The stock must be optionable.
The options chain must offer several available strikes with decent spread and premiums.
 

Here is a snippet comparing bad options and good options:
 
Good options chain - bad options chain
 
Compare the left picture showing multiple strikes available to trade and decent premiums. Not the best options chain, but acceptable. The right side of the picture shows an option chain that offers no strikes and no premiums. I then avoid trading these stocks. I still may buy them, but do not trade options. An exception may be trading a wheel strategy with at the money strikes but even that, the chain on the picture is so bad that I would probably avoid that too.
 

Third

Once I have my list, I start trading options against these stocks. I also accumulate those stocks to reach 100 shares. That way, my call side becomes a covered call. But before I accumulate, I go naked.

I always start selecting first standard deviation (1SD) strikes. That is around delta 10. I like the Tasty Works platform because they show you where the 1 SD is but if you do not have that shown on your platform it can be calculated.
 
Options chain
 

If your platform doesn’t show it, you can calculate it. Take at the money call and put strikes and add them together, then subtract and add that number to the current price and you get your 1 SD for the particular chain.
 
Options chain 2
 

Brokers may calculate the 1 SD differently (they may add IV to their formula) but options usually price it in already. During weekends the chains may also be mispriced so you want to calculate these levels during weekdays and ideally when the market is open so you get the most recent quotes (note the chart above may be showing old strike quotes and the calculated 1 SD can differ from shown).
 
Options chain 3
 
As you can see, the web trading platform doesn’t show deltas, so I had to pull out the desktop platform to get the stock deltas. And the 1 SD is around 10 – 15 delta so if you do not want to calculate where the 1 SD is, just use delta as your guide.
 

The next number I look at is the premium. I want to collect at least 1% of the underlying price. So for example, if a stock is trading at $40 a share, then for 100 shares worth $4000 I want a 1% or $40 premium. So it must be trading for at least 0.40. And this number is for the entire strangle not just one side! This will allow me to be far away from the market and thus safe and still collect a good premium.
 

Fourth

And what time frame? I tend to go for monthly expirations first and 30 to 45 DTE trades. But I am OK to go weekly (as low as 2 to 4 days to expiration) if the conditions are met – I will be beyond 1 SD and collect 10%.
 

Fifth

As I said above, options are flexible, fluid, always moving. The rules above are a basis of design or basis of trade. I am willing to deviate from it. If I trade wheel strategy, I am OK to go closer to the money and trade only one side for example. Or if I feel extremely bullish, I may skew my puts higher (but usually not closer than delta 30). I am also OK to trade 60 DTE trade in lieu of 45 DTE. And also I do not follow the rules above as strictly with rolling trades as I would do with a brand new trade. I also look at the BP requirements, some trades would require $800 buying power at 45 DTE while the same trade at 20 DTE would require $1460 BP. Thus I pick 45 DTE.
 

These are my basic rules when constructing a strangle trade, and now, let’s go and review this week’s investing and trading.

 

Here is our investing and trading report:

 

Account Value: $73,988.27 $513.04 +0.70%
Options trading results
Options Premiums Received: $1,364.00    
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%  
05 June 2021 Options: $4,677.00 +6.37%  
06 July 2021 Options: $1,364.00 +1.84%  
Options Premiums YTD: $29,074.00 +39.30%  
Dividend income results
Dividends Received: $133.85    
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    
06 July 2021 Dividends: $133.85    
Dividends YTD: $797.39    
Portfolio metrics
Portfolio Yield: 4.61%    
Portfolio Dividend Growth: 8.47%    
Ann. Div Income & YOC in 10 yrs: $16,700.35 19.16%  
Ann. Div Income & YOC in 20 yrs: $156,925.56 180.04%  
Ann. Div Income & YOC in 25 yrs: $800,540.79 918.45%  
Ann. Div Income & YOC in 30 yrs: $6,838,812.73 7,846.08%  
Portfolio Alpha: 31.77%    
Portfolio Weighted Beta: 0.72    
CAGR: 760.94%    
AROC: 30.11%    
TROC: 23.33%    
Our 2021 Goal
2021 Dividend Goal: $1,071.42 74.42%  
2021 Portfolio Value Goal: $42,344.06 174.73% Accomplished

 

Dividend Investing and Trading Report

 
Last week, we have received a $133.85 dividends income. We feel that the income will be growing faster as more of our holdings mature and become eligible for dividend payouts. According to our holdings currently on our balance sheet, all stocks should generate $3,786.54 annual dividend income. It is not as of yet because many of the stocks were purchased recently and we missed their dividend. But next year, we should be receiving the full amount.

The chart below indicates our current annual dividend payout from our dividend stock holdings.

Last week, our dividend income reached 74.42% of our dividend income goal.

 
Annual Dividend Payout week 27
 

Options Investing and Trading Report

 
Last week we again rolled a few trades to release a stressed buying power in our account. We rolled AAPL strangle as the stock shot up and our call side got in the money. We were also adjusting our BABA trade as the Chinese government kept hammering their own companies. I also rolled Tesla (TSLA) trades as they were near expiration and in the money. I had to roll BA, MU, T, KBE, and ABBV. Now the trades are in good shape and I hope they stay in good shape.

I also opened new trades against FLMN trade. We sold a put option and we are willing to buy 100 shares of this stock so if the put gets in the money, we will let it assign (unless the new option chain offers a good roll).

The new trades and adjustments delivered $1,364.00 options premiums last week.
 

You can watch all our trades in this spreadsheet and you can also subscribe to our newsletter for our trade alerts.
 

Expected Future Dividend Income

 
As the table at the beginning of this report indicates, our aggressive dividend growth stocks accumulation is starting to show significant progress in our future dividends income. Our portfolio dividend yield and dividend growth will be bringing us almost $156,925.56 in 20 years and $6,838,812.73 in 30 years. I wish, I had that $6 million income now. But that is the fate of dividend growth investing. It is not a quick rich scheme and building an account takes time.

We will keep aggressively accumulating dividend growth stocks to generate liveable income sooner than in 20 years. And the portfolio is starting to show this to be happening. In just 10 years, we will start receiving $16,700.35 in today’s dollars. It is not bad considering that in March 2021 it was only $3,202.52 in projected future dividends.

 
Future Divi on YOC week 27
 

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 $92,291.19 to $93,468.90. Last week, we added only a single stock position to our portfolio. We purchased 10 shares of ICSH.

We use ICSH as a savings account and as of today, we are mostly in a preservation mode. We feel like our balance sheet is way aggressive and no cash reserves. Therefore, we are mostly adding money to our cash reserves.

Next 6 months trading rules

With that being said, we are in a preservation mode and trade lightly only. Here are the rules we are following for the rest of the year:
 

  1. We will not be opening new options trades. Only existing trades that expire will be re-opened. No scaling up.
  2. We will only roll existing trades that get in trouble.
  3. Save $600 every week in ICSH.
  4. If no cash available to buy ICSH, roll the purchase requirement over to the next week.
  5. Accumulate $40,000 in the ICSH fund.
  6. After the weekly purchase of ICSH, buy DGI stock using 20% of available buying power if it is above $2,000
  7. If purchasing a DGI stock would result a BP dropping below $2,000, the stock purchase cannot be made.
  8. Raise available BP to $10,000 before scaling the trades up again

 

This way, I hope to raise enough cash for opportunities and also overcome volatility when the market hits the fan.

 
Stock holdings week 27
 

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 1.84% monthly ROI in July 2021, totaling a 39.30% ROI YTD. We are getting close to our 45% mark!

Our account grew by 259.65% this year despite very slow growth in June and July. I suggest the growth was suppressed by the market volatility and options trades increasing their maintenance requirements that ate the net-liq value. Once the options expire (hopefully) the net liquidating value will go up faster.
 

Our options trading averaged $4,153.43 per month this year. If this trend continues, we are on track to make $49,841.14 trading options in 2021. With the income of $29,074.00 to date, we are half way to this projected income.
 

Old SPX trades repair

 

This week, we didn’t do anything with our old SPX trades.

 

Accumulating Growth Stocks

 

Last week, we didn’t add any speculative or growth stocks to our portfolio. But, we will be adding SNOW and TSLA to reach 100 shares.

 

Accumulating Dividend Growth Stocks

 

Last week, we added 10 shares of ICSH only. Next week, we may be adding more shares if our new rules allow it.

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

 

The stock market continued higher last week as expected with a little hiccup on Thursday that quickly recovered on Friday. Tech stocks appear to be in the spotlight again, AAPL, AMZN, and other tech stocks skyrocketed to new all-time highs. APPL started moving again after several months of dormancy. But this is a typical AAPL behavior.

We are entering into another earnings season and the expectation is 64% growth in earnings vs. last year’s comparable quarter. Remember though, that we are up against a quarter that saw the economy shut down in many areas due to Covid-19 last year. And if the earnings disappoint, we may see some serious selling. However, given that the economy is recovering very strongly, it is highly unlikely that the companies would fail to beat earnings compared to last year when everything was closed.

The stock market (as measured by S&P 500) is still in a good, uninterrupted, long-term uptrend. Even with a few dips on the road, it still is going up with no resistance:

 
SPX July 10 2021 outlook
 

However, the market keeps going higher reaching our target price of $4,400. The target is in fact a 1SD level for July and we are bout to hit that level. What are the implications? Or why we may actually see that level being hit?

 
SPX July 10 2021 outlook
 

Most of the big institutions and hedge funds trade naked options, they sell the options (unlike the retail investors who foolishly buy options). But although they trade options naked, they hedge them. So if they have naked short calls, as the market goes higher, they start buying shares to hedge their positions. And that is propelling the market higher. Unless we see some issues or some black swan event that would change the narrative, expect this market to go higher and reach the mark.

 

Investing and trading report in charts

 

Account Net-Liq

 

TW Account Net-Liq week 25

 

Account Stocks holding

 
TW Account holdings week 27
 

Our stock holdings still do not beat the market. However, I expect it to change over time. S&P 500 grew 51.05% since we opened our portfolio while our portfolio grew 18.39% only. On YTD basis, the S&P 500 grew 21.21% and our portfolio 11.40%.

But the numbers above apply to our stock holdings in our account, not the overall account net-liq growth. Our overall account beats the market growing by 259.65%!
 

Stock holdings Growth YTD

 
TW Account holdings Growth YTD
 

I expect our stock holdings to start outperforming the market as they mature. However, these are just our stock holdings. The entire portfolio beats the market by far thanks to monetizing those positions.

Our goal is to grow this account to $1,000,000.00 value in ten years. We are in year two.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Income week 27
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Income week 27
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 27
 

We are on track to accomplish our dividend income goal, currently, we are at 74.42% of the goal to reach $1,071 of dividend income this year. Currently, we accumulated enough shares to receive $3,785.54 in annual dividends if we have held through the entire dividend cycle.
 

TW Received vs Future Dividends week 27

The chart above is the corrected chart comparing the projected MONTHLY dividend income vs received dividend income. And again, the projected dividend income is based on the stock holdings up to date. That is the income we would have received if we have held over the entire dividend cycle.

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return. It shows how the last week’s selloff shook down our returns but we are recovering along with the market.
 

TW cumulative return wk 27
 

As of today, our account cumulative return is 28.94% (since March 13, 2021).

 

Conclusion of our investing and trading report

 

This week our options trading exceeded our expectations. I hope, the rest of the month will be even better.

We will continue accumulating the dividend growth stocks in our portfolio to reach 100 shares. We will also replenish our cash reserves to bring them back to 25% of our current net-liq value.

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




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Posted by Martin July 07, 2021
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Dividend Growth Stocks to Accumulate in July 2021


Our primary goal is to accumulate dividend growth stocks and create a strong, safe, and large passive income. Our secondary goal is to trade options around those stocks to generate additional income and reinvest that income to accumulate even more dividend growth stocks.

To find a proper strategy that would get me to my goal, I needed to answer a simple question: How to invest to achieve my goal? How to achieve a large enough income that can buy more stocks that would generate even more income? The answer was dividend growth stocks.

I was not satisfied with just dividends. An income from dividends is small and grows slowly. At least, at the beginning of the accumulation phase. So, I added an options strategy to generate even more income selling options and collecting premiums. But I wanted more. So, I started looking for speculative but safe high-yielding dividend stocks (mostly ETFs and closed-end funds “CEF”). Unlike the dividend growth stocks, these stocks can be bought and sold out from our portfolio. The dividend growth stocks are the only stocks we plan to hold forever (unless they cut the dividend due to insufficient earnings or free cash flow).
 

Dividend growth stocks to accumulate in July 2021

 

July 2021 dividend growth stocks

 

Do your own due diligence if you decide to invest in these stocks. The information here is believed to be accurate but may have changed since publishing.
 

We will hold these stocks forever. We will sell them only when they no longer meet our dividend investing criteria (for example the company cuts the dividend) or the stock significantly underperform and better opportunities present themselves. If these companies keep paying dividends and increasing them, we will hold.

We will also sell options around these positions to offset our cost basis. During selloffs and recoveries, we may also buy call options to capture the recovery. If you are interested to see what we are buying and what options we are selling/buying, subscribe to our program.
 
 




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Posted by Martin July 06, 2021
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June 2021 $100 Challenge account review


We have completed our first month growing our $100 account to $75,000. At first, the net-liq value was a bit bumpy but it quickly recovered. We also deposited another $100 to our account (we will keep adding $100 every month). As of today, our account is worth $302.67. That makes our account behind the monthly goal but it is expected in this early stage of accumulation that we would not make much. However, as we progress, the account will speed up and will start growing faster.
 

Accumulation phase

 
Since our account is small we need to accumulate cash first. But while waiting, we also want to get paid. Once we accumulate enough cash to start trading options, we will liquidate our initial investment so we can trade, but not for long. Once we start trading, we will continue re-accumulating our positions and trading options against that position – or in other words, monetizing it. We will have saved enough in about 2 more months when the account will be large enough to take first small option trades and boost our income.
 

June 2021 Challenge account review

 

The month is in the books and our account ended the month with

MONTH GOAL $$ ACTUAL $$
June 2021: $203.00 $202.67
July 2021: $306.00 $302.67
August 2021: $409.00  
September 2021: $512.00  
October 2021: $615.00  
November 2021: $718.00  
December 2021: $821.00  
January 2022: $924.00  
February 2022: $1,027.00  
March 2022: $1,130.00  
April 2022: $1,233.00  
May 2022: $1,336.00  

 

$100 Challenge account review

 
From the chart above, the red dot (line) indicates the current account value, compared to the blue line (plan). As of today, we are at the very beginning of the journey.
 

June 2021 Overall Challenge account review

 
The chart below indicates our account value compared to the overall goal and plan to grow $100 investment into a $75,000 portfolio. As of today, we are at the beginning of our journey.

YEAR CONTRIBUTIONS $$ GOAL $$ ACTUAL $$
Year 0: $100.00 $100.00 $100.00
Year 1: $1,300.00 $1,336.00 $302.67
Year 2: $2,500.00 $3,016.96  
Year 3: $3,700.00 $5,303.07  
Year 4: $4,900.00 $8,412.17  
Year 5: $6,100.00 $12,640.55  
Year 6: $7,300.00 $18,391.15  
Year 7: $8,500.00 $26,211.96  
Year 8: $9,700.00 $36,848.27  
Year 9: $10,900.00 $51,313.64  
Year 10: $12,100.00 $70,986.56  

 

$100 Challenge account review goal

 

June 2021 Cumulative return Challenge account review

 

As of today, our challenge account provided a 1.16% monthly cumulative return.
 

$100 Challenge account review goal

 

If you want to see what investments we take, what trades and strategies we will use to grow this small account join our program today and grow your money too. We engage in safe investments, select strategies to maximize winning trades, and grow our portfolio. And you can do it too, today! We do not provide quick rich promises, gambling, or reckless strategies. We want our portfolio to grow steadily and preserving our capital while maximizing returns.

 

 




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Posted by Martin July 03, 2021
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2021 Week 26 investing and trading report


June 2021 is over. It was a good month trading stock options, although not the best month. The Net-liq of the account increased a little (only +6.73%) compared to double-digit growths in the previous months. Our options income grew above the average so I am happy about it. In this investing and trading report, we will once again present the results of our dividend growth investing and options trading.
 

Our investing and trading rules

 
Once again, we would like to remind you of our rules when trading and investing in our portfolio, or investment fund. It is important to know what rules and what kind of trading we engage in. In this case, you will understand our results and our trades as they will be put into a perspective.

For example, a scalper, or a swing trader has different rules and takes different trades than a long-term investor. So you need to know what we trade.

 

6 Rules of our trading

 

  1. We do NOT trade stocks, we do not look to sell our stock positions.

  2. Our positions are our stock rental properties.

  3. We consistently use our stock rental properties to generate income.

  4. We do not stress over our positions going up or down.

  5. We use the income generated for living expenses or it can be reinvested into new assets.

  6. Trading should be fun but it is also a business.

 

With these rules, we can invest and trade options without fear of losing or fear of having a trade that is going against us. We have a long-term INVESTOR mentality. And that gives us peace of mind. I said that many times. Even as a trader, you still have to think, act, and be an investor. Many people start trading because they want to be traders. But then, they take a trade that goes against them and they decided to be investors. They end up sitting on a bad trade and think that one day, they will be able to go out. They are now involuntary investors.

And now, let’s go and review this week’s investing and trading.

 

Here is our investing and trading report:

 

Account Value: $73,475.23 $1,086.34 +1.50%
Options trading results
Options Premiums Received: $716.00    
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%  
05 June 2021 Options: $4,677.00 +6.37%  
Options Premiums YTD: $28,384.00 +38.63%  
Dividend income results
Dividends Received: $26.43    
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    
Dividends YTD: $709.64    
Portfolio metrics
Portfolio Yield: 4.60%    
Portfolio Dividend Growth: 8.44%    
Ann. Div Income & YOC in 10 yrs: $16,467.77 19.00%  
Ann. Div Income & YOC in 20 yrs: $152,946.95 176.50%  
Ann. Div Income & YOC in 25 yrs: $771,976.83 890.84%  
Ann. Div Income & YOC in 30 yrs: $6,491,300.24 7,490.78%  
Portfolio Alpha: 31.06%    
Portfolio Weighted Beta: 0.73    
CAGR: 774.18%    
AROC: 30.02%    
TROC: 21.01%    
Our 2021 Goal
2021 Dividend Goal: $1,071.42 66.23%  
2021 Portfolio Value Goal: $42,344.06 173.52% Accomplished

 

Dividend Investing and Trading Report

 
Last week, we have received a $26.43 dividends income. We feel that the income will be growing faster as more of our holdings mature and become eligible for dividend payouts. According to our holdings currently on our balance sheet, all stocks should generate $3,783.70 annual dividend income. It is not as of yet because many of the stocks were purchased recently and we missed their dividend. But next year, we should be receiving the full amount.

The chart below indicates our current annual dividend payout from our dividend stock holdings.

Last week, our dividend income reached 66.23% of our dividend income goal.

 
Annual Dividend Payout week 26
 

Options Investing and Trading Report

 
Last week we again rolled a few trades to release a stressed buying power in our account. In about a mid-week, our account started showing more growth of BP and we were able to re-open one last trade that was still pending as “to be reopened”.

What does that mean?

For the first half of the year, I was scaling up my trades. When the account, buying power, and cash grew, I was adding more and more new trades. For the second half of this year, I decided to not scale up the trades and trade only what I am trading up to today. So I set rules for the rest of the year to only reopen trades that expired or were closed, and roll existing trades. But no new trades that would require more BP.

Based on the rule described above, I opened a new trade against MU only. Now I am fully invested and I will be reopening expired trades only.

Last week, no trade had an expiration day.

The new trades and adjustments delivered $716.00 options premiums last week.
 

You can watch all our trades in this spreadsheet and you can also subscribe to our newsletter for our trade alerts.
 

Expected Future Dividend Income

 
As the table at the beginning of this report indicates, our aggressive dividend growth stocks accumulation is starting to show significant progress in our future dividends income. Our portfolio dividend yield and dividend growth will be bringing us almost $152,946.95 in 20 years and $6,491,300.24 in 30 years. I wish, I had that $6 million income now. But that is the fate of dividend growth investing. It is not a quick rich scheme and building an account takes time.

We will keep aggressively accumulating dividend growth stocks to generate liveable income sooner than in 20 years. And the portfolio is starting to show this to be happening. In just 10 years, we will start receiving $16,467.77 in today’s dollars. It is not bad considering that in March 2021 it was only $3,202.52 in projected future dividends.

 
Future Divi on YOC week 26
 

The chart above shows how our future dividend income 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 $88,163.26 to $92,291.19. Last week, we added a few stock positions to our portfolio, such as 10 shares of VICI, 15 shares of ICSH, 10 shares of PMT, and 23 shares of ABBV.

With the addition of 23 shares of ABBV, we finished accumulating this stock. We now hold 100 shares of ABBV. We will proceed to accumulate other shares. Our immediate candidate for more accumulation is VICI Properties Inc. (VICI).

 
Stock holdings week 26
 

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 6.37% monthly ROI in June 2021, totaling a 38.63% ROI YTD. We are getting close to our 45% mark!

Our account grew by 257.16% this year despite very slow growth in June. I suggest the growth was suppressed by the market volatility and options trades increasing their maintenance requirements that ate the net-liq value. Once the options expire (hopefully) the net liquidating value will go up faster.
 

Our options trading averaged $4,054.86 per month this year. If this trend continues, we are on track to make $48,658.29 trading options in 2021. With the income of $28,384.00 to date, we are half way to this projected income.
 

Old SPX trades repair

 

This week, we rolled one old SPX trade away, keeping the bad dream going. But I am thinking to let it go. There are traders out there that roll their trades for years until they finally work in their favor. I might be doing the same thing here until I will grow our account enough to get rid of an Iron Condor and switch to a strangle. With a strangle, I have a lot better chance to adjust the trade successfully. But a strangle against SPX is capital expensive trade. It will require a lot of margin. And the only way how to reduce the margin is to be able to trade with a portfolio margin. For now, I will keep it on and decide later.

 

Accumulating Growth Stocks

 

Last week, we didn’t add any speculative or growth stocks to our portfolio. But, we will be adding SNOW and TSLA to reach 100 shares.

 

Accumulating Dividend Growth Stocks

 

Last week, we added 15 shares of ICSH (which is our savings account equivalent), 10 shares of VICI, 10 shares of PMT, and 23 shares of ABBV to our portfolio. We have reached our goal to accumulate 100 shares of ABBV.

VICI is a new company. It is a REIT that invests in properties in Las Vegas like Caesars Palace. They do not own and operate the hotel itself, but they own the building and rent it to the hotel owner. Unlike many businesses, they were not impacted by covid-19 (the stock was because investors were freaking out about the business but the fears never materialized). The company was getting paid the rent every single month during the pandemic. And once investors realized that VICI was not impacted, the stock recovered extremely quickly.

The company has very good growth potential and its expected earnings are estimated to grow by 10% year over year. Currently, the stock is greatly undervalued at the current price of $31.09 (my calculated intrinsic value is $96.21 for 2021 and $101.63 for 2022. So, I will be accumulating at these levels aggressively.

The company pays dividends, currently yielding 4.25% and they have been increasing the dividend since 2017. The management appears to be investors friendly and they plan on paying and increasing dividends in the future.

And lastly, if you go to Vegas these days, you will experience enormous visitations by tourists. Vegas is packed! Streets are full of people and restaurants are booked three to four weeks ahead. Yes, you read it correctly, three to four weeks ahead. I believe, VICI is a good way to get a share of this recovery frenzy.

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.

I feel really good about finishing our ABBV accumulation phase. ABBV is not a cheap stock and it took a long time to get to 100 shares. But now that we are there, I am proud.

 

Market Outlook

 

The stock market broke above its sideways consolidation trade, confirmed the breakout, and now continues going higher. It is in a clear and strong uptrend and as of now, it has no resistance above. So, it can literally move to the moon. The only resistance is priced by the market at $4,400 as expected move since June 18. The more the market moves towards that level, the more hedge funds have to start hedging their positions by buying shares against their short calls, and the more they do so, the more the market melts up. As we get closer to that level, expect faster and stronger moves. And then? After that, either consolidation or retreat.

 
SPX July 03 2021 outlook
 

With current S&P 500 earnings at 194 a share, the intrinsic value of the market is at $4,074 a share. That makes this market overvalued. But we are still recovering from the pandemic and businesses are expected to grow. The earnings forecast for 2022 is at 218 per share and that would make this market’s intrinsic value $4,578 (without Biden’s corporate tax hike). If this market keeps going sideways, the evaluation may catch up with the current price.

 

90% probability of going up

 

Based on the numbers and earnings of the market, the trend momentum shifted to the upside dramatically over the last week. Expect this market to continue going higher unless some black swan event halts it.

 

Investing and trading report in charts

 

Account Net-Liq

 

TW Account Net-Liq week 25

 

Account Stocks holding

 
TW Account holdings week 26
 

Our stock holdings still do not beat the market. However, I expect it to change over time. S&P 500 grew 50.46% since we opened our portfolio while our portfolio grew 17.32% only. On YTD basis, the S&P 500 grew 20.61% and our portfolio 10.33%.
 

Account Growth YTD

 
TW Account holdings Growth YTD
 

I expect our stock holdings to start outperforming the market as they mature. However, these are just our stock holdings. The entire portfolio beats the market by far thanks to monetizing those positions.

Our goal is to grow this account to $1,000,000.00 value in ten years. We are in year two.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Income week 26
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Income week 26
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 26
 

We are on track to accomplish our dividend income goal, currently, we are at 66.23% of the goal to reach $1,071 of dividend income this year. I also noticed that I was mistakenly comparing our monthly dividend income with the annual dividend income projection on the chart below. So I corrected that chart and moved the annual dividend projection to this chart (above). Now, what you can see, is the received dividends per year (blue), our 2021 goal (red line), and dividend projection based on the existing holdings (magenta line). If we held our current holding for the entire dividend cycle, the projection is the dividends we would have received.

Currently, we accumulated enough shares to receive $3,783.70 in annual dividends if we have held through the entire dividend cycle.
 

TW Received vs Future Dividends week 26

The chart above is the corrected chart comparing the projected MONTHLY dividend income vs received dividend income. And again, the projected dividend income is based on the stock holdings up to date. That is the income we would have received if we have held over the entire dividend cycle.

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return. It shows how the last week’s selloff shook down our returns but we are recovering along with the market.
 

TW cumulative return wk 25
 

As of today, our account cumulative return is 28.04% (since March 13, 2021).

 

Conclusion of our investing and trading report

 

This week our options trading exceeded our expectations. I hope, the rest of the month will be even better.

We will continue accumulating the dividend growth stocks in our portfolio to reach 100 shares. We will also replenish our cash reserves to bring them back to 25% of our current net-liq value.

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




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Posted by Martin June 26, 2021
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2021 Week 25 investing and trading report


June 2021 is almost over, one more week and the month’s books can be closed. Although our options income was good this month, our account grew little compared to previous months. As you will see in this investing and trading report, our net-liq went up by 5.15% this month only. Our options revenue was 5.47% this month. Our dividend income reached $142.13 for June totaling $637.11 for the year 2021. However, June is not yet over, we still have one week to go and it may all change.
 

Let’s go and review this week’s investing and trading.

 

Here is our investing and trading report:

 

Account Value: $72,388.89 $2,377.24 +3.40%
Options trading results
Options Premiums Received: $1,407.00    
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%  
05 June 2021 Options: $3,961.00 +5.47%  
Options Premiums YTD: $26,994.00 +37.29%  
Dividend income results
Dividends Received: $32.75    
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: $142.13    
Dividends YTD: $637.11    
Portfolio metrics
Portfolio Yield: 4.65%    
Portfolio Dividend Growth: 8.44%    
Ann. Div Income & YOC in 10 yrs: $15,928.83 19.33%  
Ann. Div Income & YOC in 20 yrs: $150,048.39 182.08%  
Ann. Div Income & YOC in 25 yrs: $766,137.56 929.67%  
Ann. Div Income & YOC in 30 yrs: $6,543,526.56 7,940.21%  
Portfolio Alpha: 29.64%    
Portfolio Weighted Beta: 0.74    
CAGR: 784.70%    
AROC: 36.09%    
TROC: 22.60%    
Our 2021 Goal
2021 Dividend Goal: $1,071.42 59.46%  
2021 Portfolio Value Goal: $42,344.06 170.95% Accomplished

 

Dividend Investing and Trading Report

 
Last week, we have received a $32.75 in dividends income. We feel that the income will be growing faster as more of our holdings mature and become eligible for dividend payouts. According to our holdings currently on our balance sheet, all stocks should generate $3,602.93 annual dividend income. It is not as of yet because many of the stocks were purchased recently and we missed their dividend. But next year, we should be receiving the full amount.

The chart below indicates our current annual dividend payout from our dividend stock holdings.

Last week, our dividend income reached 59.46% of our dividend income goal.

 
Annual Dividend Payout week 25
 

Options Investing and Trading Report

 
Last week we rolled a few trades that got in trouble. The market continued declining just to reverse a few days later. The trades that we were adjusting to the downside suddenly needed to be adjusted to the upside.

We opened a covered call against newly acquired KBE shares and re-opened trades that expired last week, such as strangle against ABBV, OXY, AES, and O. Then we rolled trades such as AAPL, OXY, DKNG, AXP, BABA, BA, and WEN.

The new trades and adjustments delivered $1,407.00 options premiums last week.
 

We had only one trade that expired for a full profit:
 

1 ABBV Jun25 110 put / 118 call strangle for +0.49 credit
 

You can watch all our trades in this spreadsheet and you can also subscribe to our newsletter for our trade alerts.
 

Expected Future Dividend Income

 
As the table at the beginning of this report indicates, our aggressive dividend growth stocks accumulation is starting to show significant progress in our future dividends income. Our portfolio dividend yield and dividend growth will be bringing us almost $150,048.39 in 20 years and $6,543,526.56 in 30 years. We will keep aggressively accumulating dividend growth stocks to generate liveable income sooner than in 20 years. And the portfolio is starting to show this to be happening.

 
Future Divi on YOC week 25
 

The chart above shows how our future dividend income 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 $83,739.91 to $88,163.26. Last week, we added a few stock positions to our portfolio, such as 15 shares of ICSH, and 10 shares of ABBV. We now hold 77 shares of ABBV in this portfolio and we will continue accumulating to reach 100 shares as quickly as possible.

 
Stock holdings week 25
 

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 5.47% monthly ROI in June 2021, totaling a 37.29% ROI YTD.

Our account grew by 251.87% this year despite very slow growth in June. I suggest the growth was suppressed by the market volatility and options trades increasing their maintenance requirements that ate the net-liq value. Once the options expire (hopefully) the net liquidating value will go up faster.
 

Our options trading averaged $4,499.00 per month this year. If this trend continues, we are on track to make $53,988.00 trading options in 2021. With the income of $26,994.00 to date, we are half way to this projected income.
 

Old SPX trades repair

 

This week we have not done any adjustments to our old SPX trades. We are still sitting on those trades and waiting for the untouched side to close so we can roll the trades again. The goal will be to roll the trades until we will be able to close them for at least break even and release the buying power. We will keep doing this only if the resulting trade will be a credit trade or a very small debit. If adjusting these trades would require adding more new money, we would rather close these trades and move on.

 

Accumulating Growth Stocks

 

Last week, we didn’t add any speculative or growth stocks to our portfolio. But, we will be adding SNOW to reach 100 shares. It is interesting to see people out there and investors taking notice of this stock. I mentioned this stock for the first time on Facebook in December 2020 and started buying shares of the company since then:

“I think they are betting on the cloud business competing AMZN. I also think SNOW can get a nice market share and the price could go way higher over time. AMZN’s valuation was also always crazy when it was trading for 300 a share. Today, it trades at 3000+ a share… and it is still a crazy valuation…
I think they consider entering into AMZN to be too late as AMZN is maturing and the growth will be slowing. SNOW is a new company and its growth can be multifold.”

If you look at my reports, many times I was mentioning SNOW as a great stock to be in, that it could become a new Amazon in cloud service. One year later (almost a year) people are starting to take notice.

 

Accumulating Dividend Growth Stocks

 

Last week, we added 10 shares of ICSH (which is our savings account equivalent), and 10 shares of ABBV to our portfolio.

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

 

The stock market continued being trendless until Wednesday, June 23rd, 2021, then, on Thursday after the White House announcement of a bipartisan infrastructure deal, the market spiked up and broke out of the sideways channel. Could this be the beginning of another leg up?

Thursday’s breakout seems to be confirmed on Friday. If we see more uptrend on Monday, we may expect another leg up of this market.

 
SPX June 26 2021 outlook
 

With current S&P 500 earnings at 195, the intrinsic value of the market is at $4,095 a share. That makes this market overvalued. But we are still recovering from the pandemic and businesses are expected to grow. The earnings forecast for 2022 is at 205 per share and that would make this market’s intrinsic value $4,305. If this market keeps going sideways, the evaluation may catch up with the current price.

 

70% probability of going up

 

Based on the numbers and earnings of the market, the trend momentum shifted to the upside dramatically over the last week. Unless this breakout turns out to be fake.

 

Investing and trading report in charts

 

Account Net-Liq

 

TW Account Net-Liq week 25

 

Account Stocks holding

 
TW Account holdings week 25
 

Our stock holdings still do not beat the market. However, I expect it to change over time. S&P 500 grew 47.98% since we opened our portfolio while our portfolio grew 17.85% only. On YTD basis, the S&P 500 grew 18.14% and our portfolio 10.87%.
 

Account Growth YTD

 
TW Account holdings Growth YTD
 

I expect our stock holdings to start outperforming the market as they mature. However, these are just our stock holdings. The entire portfolio beats the market by far thanks to monetizing those positions.

Our goal is to grow this account to $1,000,000.00 value in ten years. We are in year two.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Income week 25
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Income week 25
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 25
 

We are on track to accomplish our dividend income goal, currently, we are at 59.46% of the goal to reach $1,071 of dividend income this year.

However, the chart below indicates that our dividend income will possibly exceed this goal as we accumulated enough shares to receive $3,602.93 in dividends.
 

TW Received vs Future Dividends week 25

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return. It shows how the last week’s selloff shook down our returns but we are recovering along with the market.
 

TW cumulative return wk 25
 

As of today, our account cumulative return is 27.02% (since March 13, 2021).

 

Conclusion of our investing and trading report

 

This week our options trading exceeded our expectations. I hope, the rest of the month will be even better.

We will continue accumulating the dividend growth stocks in our portfolio to reach 100 shares. We will also replenish our cash reserves to bring them back to 25% of our current net-liq value.

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




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Posted by Martin June 19, 2021
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2021 Week 24 investing and trading report


The market didn’t like the FED meeting and what they came up with after they finally admitted that the inflation may not be as transitory as they were trumpeting last few months. In this trading report, we will look at our investing and trading results, and focus on the market direction and how to protect our portfolio against the new inflationary cycle.
 

Let’s go and review this week’s investing and trading.

 

Here is our investing and trading report:

 

Account Value: $70,011.65 -$2,308.14 -3.19%
Options trading results
Options Premiums Received: $974.00    
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%  
05 June 2021 Options: $2,554.00 +3.65%  
Options Premiums YTD: $25,587.00 +36.55%  
Dividend income results
Dividends Received: $43.99    
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: $109.38    
Dividends YTD: $604.36    
Portfolio metrics
Portfolio Yield: 4.72%    
Portfolio Dividend Growth: 8.44%    
Ann. Div Income & YOC in 10 yrs: $15,942.33 19.80%  
Ann. Div Income & YOC in 20 yrs: $795,593.16 988.25%  
Ann. Div Income & YOC in 25 yrs: $649,650.04 891.04%  
Ann. Div Income & YOC in 30 yrs: $6,948,865.15 8,631.57%  
Portfolio Alpha: 28.90%    
Portfolio Weighted Beta: 0.74    
CAGR: 788.07%    
AROC: 29.00%    
TROC: 22.79%    
Our 2021 Goal
2021 Dividend Goal: $1,071.42 56.41%  
2021 Portfolio Value Goal: $42,344.06 165.34% Accomplished

 

Dividend Investing and Trading Report

 
Last week, we have received a $43.99 in dividends income. We feel that the income will be growing faster as more of our holdings mature and become eligible for dividend payouts.

The chart below indicates our current annual dividend payout from our dividend stock holdings. A dividend growth investor needs to be aware of this payout from each stock. The chart indicates that some stocks contribute (or will be contributing to our income with large sums while others contribute very little. That can be a problem. If a company that contributes with large dividends suddenly cuts the dividend, it will have a very significant impact on our income (for example, if OMF cuts the dividend, or suspends it, the impact on our portfolio dividend income will be significant.

I am OK with this imbalance during the accumulation phase but plan to address it in the next phase of cultivating our portfolio. In other words, in the next phase, I will be accumulating stocks with lesser payout to match the stocks that pay more in dividends. If a company cuts the dividend, the impact of a lost income will be mitigated.

Last week, our dividend income reached 56.41% of our dividend income goal.

 
Annual Dividend Payout week 24
 

Options Investing and Trading Report

 
Last week we didn’t trade much. We rolled a few trades that got in trouble. We also reopened some of the trades that expired two weeks ago and we were waiting for the market to show its direction.

The new trades and adjustments delivered $974.00 options premiums last week.

We had a few trades expiring this week and we may re-open them next week (but that will depend on the market). The following trades expired for a full profit:

1 TSLA Jun18 660/670 bear call spread for +0.70 credit
1 TSLA Jun18 530/540 bull put spread for +0.83 credit
1 KBE Jun18 50 put / 60 call strangle for +0.67 credit
1 O Jun18 65 put for +0.45 credit
1 ABBV Jun18 108 put / 123 call strangle for +0.86 credit
1 AES Jun18 24 put / 27 call strangle for +0.31 credit
1 OXY Jun18 26 put / 32 call strangle for +0.52 credit

We had to roll our APAM trade, and our KBE puts got in the money. I was not able to roll the trade (I was not in front of the computer) and we got assigned to 100 shares of KBE. However, in the inflationary environment, banks should perform well and KBE is a banks’ ETF. So I plan on staying in the position (if I have enough cash in the account, due to SPX open trade, over the weekend, the account pricing is messed up by the broker and I can’t see what buying power I have available, so I have to wait until Monday to make the decision whether to keep KBE or close the position). If I stay, I will be selling covered calls.

You can watch all our trades in this spreadsheet and you can also subscribe to our newsletter for our trade alerts.
 

Expected Future Dividend Income

 
As the table at the beginning of this report indicates, our aggressive dividend growth stocks accumulation is starting to show significant progress in our future dividends income. Our portfolio dividend yield and dividend growth will be bringing us almost $152,246.48 in 20 years and $6,863,144.95 in 30 years. We will keep aggressively accumulating dividend growth stocks to generate liveable income sooner than in 20 years. And the portfolio is starting to show this to be happening.

 
Future Divi on YOC week 24
 

The chart above shows how our future dividend income based on the future yield on cost develops 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 $78,473.04 to $83,739.91. Last week, we added a few stock positions to our portfolio, such as 10 shares of ICSH, 100 shares of KBE (put assignment), 20 shares of TSN, and 10 shares of WBA.

 
Stock holdings week 24
 
Our goal is to accumulate 100 shares of each stock of our interest and we are getting to that goal. However, as mentioned above, this harms our dividend payout and portfolio growth. Although, it is temporary. Therefore, once we reach this goal (which we set because of the ability to trade covered calls), we will start accumulating these shares to equalize our dividend income rather than have an equal amount of shares.
 

Investing and trading ROI

 

Our options trading delivered a 3.65% monthly ROI in June 2021, totaling a 36.55% ROI YTD.

Our account grew by 240.32% this year.
 

Our options trading averaged $4,264.50 per month this year. If this trend continues, we are on track to make $51,174.00 trading options in 2021.
 

Old SPX trades repair

 

This week we have not done any adjustments to our old SPX trades. We are still sitting on those trades and waiting for the untouched side to close so we can roll the trades again. The goal will be to roll the trades until we will be able to close them for at least break even and release the buying power. We will keep doing this only if the resulting trade will be a credit trade or a very small debit. If adjusting these trades would require adding more new money, we would rather close these trades and move on.

 

Accumulating Growth Stocks

 

Last week, we didn’t add any speculative or growth stocks to our portfolio.

 

Accumulating Dividend Growth Stocks

 

Last week, we added 10 shares of ICSH, 100 shares of KBE (put assignment), 20 shares of TSN, and 10 shares of WBA to our portfolio.

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

 

The FED announced at its last week’s FOMC meeting that they may raise the interest rate in 2023. But not just once but possibly twice. The stock market didn’t like it and retreated from the all-time high.

 
SPX June 18 2021 outlook
 

In the last few weeks, the S&P 500 traded sideways in a narrow channel, it even broke the upper channel trendline but it was not convincing at all. On Wednesday and especially Friday, the market retreated hard. Currently, the market is trendless and there are no signs of direction. It can go anywhere from here.

The FED is also prepared to start reducing its bond purchasing program (at least they talk about it). That could pour more fuel on the market’s downward fire. There are several dangers for the market.

The FED is going to hike interest rates, but European Central Bank, ECB, announced that they have no interest in raising their rates and that they will keep them low at 0.00 to -0.5%. If FED does raise rates, that could spark outflows from the US markets to European markets and we might see a substantial correction.

This can easily tamper with Fed’s intentions.

 

Why did value stocks drop?

 

In the inflationary environment and rising interest rates, value stocks and low PE growth stocks perform the best. One would see banks, insurance companies, and tech stocks actually making money, not the meme stocks, rallying. But on Friday, everything went down, except the tech stocks that should not have gone down. What the heck? So why the stocks that should strive dropped? The reason was the dollar. The dollar jumped up after the announcement. But this appears to be a brief shakedown and market repositioning. Nevertheless, the growth stocks seem to be back.

 
USD June 18 2021
 

The best strategy? A mix of both, the growth stocks and value stocks.

 

70% probability of going down

 

Overall, I am still bullish and I expect the market to go as high as $4,800 – $5,000 by 2023. The reason is that the overall S&P 500 earnings expectation for the next years and the following year is extremely strong (the US economic growth is expected to remain above 5% well into 2022 and the inflation will decelerate according to Wells Fargo, and S&P 500 EPS is up to $220). That will fuel the market up. The interest hike is already priced in today’s market and unless FED comes up with any surprise (or the economy) all the events are priced in. Nothing new to expect.

But short term, we may see some correction.

 
SPX June 18 2021-2 outlook
 

The best scenario is that from here we would bounce, and continue higher. The market is sitting at a 50-day moving average and it went nowhere for months. It could be an end of a consolidation pattern. But I do not see anything that would confirm this trend, so it is just speculation.

 
SPX June 18 2021-3 outlook
 

We could continue lower to retest the previous lows before we go higher again.

 
SPX June 18 2021-4 outlook
 

But given how extended the market is, inflated by cheap money, I lean towards the declining scenario and I think we will see a correction. If we break the 50-day moving average, the $4,000 level or $3,966 level (that would correspond to a 7% correction, so we may even overshoot that target, if the market decides to go down) is very likely.

 

Investing and trading report in charts

 

Account Net-Liq

 

TW Account Net-Liq week 24

 

Account Stocks holding

 
TW Account holdings week 24
 

Our stock holdings still do not beat the market. However, I expect it to change over time. S&P 500 grew 44.03% since we opened our portfolio while our portfolio grew 14.35% only. On YTD basis, the S&P 500 grew 14.19% and our portfolio 7.36%.
 

Account Growth YTD

 
TW Account holdings Growth YTD
 

I expect our stock holdings to start outperforming the market as they mature. However, these are just our stock holdings. The entire portfolio beats the market by far thanks to monetizing those positions.

Our goal is to grow this account to $1,000,000.00 value in ten years. We are in year two.

 

Investing and Trading Report – Options Monthly Income

 
TW Options Income week 24
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Income week 24
 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 24
 

We are on track to accomplish our dividend income goal, currently, we are at 56.41% of the goal to reach $1,071 of dividend income this year.

However, the chart below indicates that our dividend income will possibly exceed this goal as we accumulated enough shares to receive $3,548.03 in dividends.
 

TW Received vs Future Dividends week 24

 

Our account cumulative return

 

The chart below indicates our cumulative adjusted return. It shows how the last week’s selloff shook down our returns but we are recovering along with the market.
 

TW cumulative return wk 24
 

As of today, our account cumulative return is 22.85% (since March 13, 2021).

 

Conclusion of our investing and trading report

 

This week our options trading exceeded our expectations. I hope, the rest of the month will be even better.

We will continue accumulating the dividend growth stocks in our portfolio to reach 100 shares. We will also replenish our cash reserves to bring them back to 25% of our current net-liq value.

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




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Posted by Martin June 15, 2021
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$100 Challenge account review


Our first week of growing a $100 dollar account to $75,000 is over and here is the weekly Challenge account review. We opened the account last week and deposited $100 initial investments plus the first month’s $100 deposit. We started with a $200 dollar account. As of today, our account is worth $200.36
 

Accumulation phase

 
Since our account is small we need to accumulate cash first. But while waiting, we also want to get paid. Once we accumulate enough cash to start trading options (in our case, at least $600 dollars), we will liquidate our initial investment so we can trade, but not for long. Once we start trading, we will continue re-accumulating our positions and trading options against that position – or in other words, monetizing it.
 

June 14th Challenge account review

 

We will track the progress of our account and compare it to our goal/benchmark. Below is the chart of our account progress for the first year of 2021-2022. Let’s see, how much we can grow this account this year compared to the plan.

MONTH GOAL $$ ACTUAL $$
June 2021: $203.00 $200.36
July 2021: $306.00  
August 2021: $409.00  
September 2021: $512.00  
October 2021: $615.00  
November 2021: $718.00  
December 2021: $821.00  
January 2022: $924.00  
February 2022: $1,027.00  
March 2022: $1,130.00  
April 2022: $1,233.00  
May 2022: $1,336.00  

 

$100 Challenge account review

 
From the chart above, the red dot (line) indicates the current account value, compared to the blue line (plan). As of today, we are at the very beginning of the journey.
 

June 14th Overall Challenge account review

 
The chart below indicates our account value compared to the overall goal and plan to grow $100 investment into a $75,000 portfolio. As of today, we are at the beginning of our journey.

YEAR CONTRIBUTIONS $$ GOAL $$ ACTUAL $$
Year 0: $100.00 $100.00 $100.00
Year 1: $1,300.00 $1,336.00 $200.36
Year 2: $2,500.00 $3,016.96  
Year 3: $3,700.00 $5,303.07  
Year 4: $4,900.00 $8,412.17  
Year 5: $6,100.00 $12,640.55  
Year 6: $7,300.00 $18,391.15  
Year 7: $8,500.00 $26,211.96  
Year 8: $9,700.00 $36,848.27  
Year 9: $10,900.00 $51,313.64  
Year 10: $12,100.00 $70,986.56  

 

$100 Challenge account review goal

 

If you want to see what investments we take, what trades and strategies we will use to grow this small account join our program today and grow your money too. We engage in safe investments, select strategies to maximize winning trades, and grow our portfolio. And you can do it too, today! We do not provide quick rich promises, gambling, or reckless strategies. We want our portfolio to grow steadily and preserving our capital while maximizing returns.

 

 




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