In a strange way I liked August’s price action. We got the correction we’ve been overdue for and got a good bit of panic to enter the market. I took the opportunity to reload on some positions and plan to make another strong run for a couple of months. There’s enough fear in the market now to think the downside risk isn’t too far from the upside potential. That’s the kind of market I prefer for writing options.
If it’s a raging bull market, you’re probably better off buying calls. If it’s a bear market, the premiums don’t always beat out the losses. With a market that will likely not fall another 5-7% in the near-term, put selling is a cool place to hang out for now. Volatility is up and risk is down.
I’m still kicking the major indexes butts although slightly off of the insane pace I was running before August. Here’s my breakdown according to what Quicken tells me my returns are. Quicken and Ameritrade tend to stay off by a few bucks always. I haven’t taken the time in a while to figure out if I’ve mistyped something or it’s just the trade settling that is the difference. Either way, I’m up 30% for the past year and that kicks ass!
- Current Account Value: Ameritrade: 61,963.34, Quicken: 62,060.79
- Annualized return year to date: 27.57%
- 12 month trailing return: 30.70%
- My % YTD return (using quicken report Average Annual Return Current Year): 16.41%
- S&P % YTD return: 4.9%
- Dow Jones % YTD return: 7.52%
If you make 30% in the next 12 months, that would be another 18K. with any savings your balance could come close to $90,000. You are getting real close to 6 figure account. Imagine everything you could do with 100,000 dollars.
Kadena, I think about that just about every day. I’m making another deposit tomorrow and have high hopes for the next 12 months on my returns. Hitting $100k starts a whole new level of excitement.
Congrats! Your investing style seems conservative yet makes lots of sense. Any plans to do different trading strategies in the near future?
Great investing style. It is somehow interesting to see how it can be easy to invest in such a thing.
Armand Rousso
http://trade.armandrousso.biz/
Pete, I don’t plan to make any major changes to my investing style. I’m always looking for ways to tweak it, but the foundation has worked well for me for a while. Now I’m actually getting enough money built up to make it somewhat worthwhile. I bought a couple of calls in the past two months and that’s different for me and sold a naked call a few weeks ago, but those are the only other changes outside of my normal naked put selling that I’ve made.