Back in 2017, my trading account statement looked like this: Account Statement, January 2017 Account Holdings, January 2017 While these were some rather solid stocks to hold onto, I knew that there had to be a better way. At the time, I was thinking about ways I can increase my portfolio performance, and I started reading various books on options trading. I read Sheldon Natenberg's "Option Volatility and Pricing" and John C. Hull's "Options, Futures, and Other Derivatives." If you have not read either of these books, I recommend them highly, since they are considered the main references in the field. After toying with some strategies and research, I decided to implement some of my trading strategies. A year later, these are my results: Account Holdings, January 8th, 2018 While the market in 2017 experienced a favorable rally, my portfolio experienced significant gains during this time. What is shown here is my IRA account....
The market keeps treating me kindly.. My leveraged portfolio is up 21.4% for the new year. Keep in mind, when you do deep-in-the-money options, you will not lose more than your initial investment, unlike buying on margin. As long as the options have not expired, you will have some positive value. My general rule of thumb is buy 20-25% into the money on any security you feel bullish on, and try to do it for a 2-year contract. I am working on getting my 401k from a former employer rolled over to my IRA. I believe the new tax bill that got passed that reduced corporate income tax will have a multiplier effect on the overall economy and corporate earnings. The recent run-up on the market has not yet captured all of the values from the bill. The strong will keep getting stronger, and this is the ideal time to go long... very long... and do it with DITM.
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