Welcome back to the business-as-usual newsletter after the short update last week. The story of the week was of course the better-than-expected CPI reading, which is a measure of inflation, which sent the market up 5% on Thursday alone. All these positions were actually closed prior to that massive move up, which means I did leave some money on the table - but I like to focus on what was made and sticking to winning systems, rather than squeezing every dollar that's possible out of the trade. Not everyone agrees with this approach, you do you. This week:
$174 profit in Microsoft
$217 profit (finally) in Walgreens
$113 total profit in Abbvie
$174 profit in MSFT
This jade lizard in Microsoft was put on about 2 weeks ago and got taken off at just over 50% profit early this week.
It's a nice win which also closes out the founding batch of my options course with 6 wins out of 6, with realised profits which covered the course fees. Of course we were a little lucky in that the volatility environment has been perfect for selling options, but it's also a nice bow to wrap on the founding batch as a solid proof of concept (which of course has zero bearings on any future performance).
For more information on the original Microsoft trade as well as what the heck a jade lizard is, check out the original trade entry post below.
$217 profit in Walgreens
If you're a long time subscriber of this newsletter, you'll be pleased to know my Walgreens position has finally been closed for a profit!
I think this WBA position has been the longest running saga in this newsletter. It started at the end of August, got in trouble in September and I rolled the position once. I was prepared to accept assignment in September but it didn't happen, so I rolled it once more in October. Finally after all those rolls I paid just $16 buy back that $35 put, which locked in a total profit of $217, or 93% of max profit. This is why options are such a powerful vehicle to use. You can be dead wrong and still manage to turn a profit, as long as you hold on to your nerve and follow the trade mechanics, rather than panic and close positions for a loss. You can follow this WBA trade all the way from the beginning and read how I approached the position when it got into trouble, to resigning myself to my fate of getting assigned 100 shares, to escaping that fate and finally turning a profit by checking out the original post below (and following it through the archives each week on my website).
$113 profit in ABBV
In last week's short newsletter I gave you an interim update in ABBV. I had sold 2x $135 puts for $90 each, and closed 1 early at 50% profit for $45. This week my remaining put was closed for $22 (or roughly 75% profit), which brings my total profit to $113, or 63% of max profit.
I think it's easy to write off these small gains as “just $45” or “just $113”, but that's the difference between selling and buying options. Option sellers like myself don't get the massive, multi-bagger wins that option buyers get, but the trade off is a much more consistent cashflow and win rate. Uninformed people will tell you option sellers will eventually get wiped out by that 1 trade that goes horribly wrong - while I'm not saying that can't happen, only people who don't stick to their risk management plans end up in that position ;) You can check out my article below for more thoughts on achieving 100 wins/profitable positions so far in 2022.
That's it for this week - just a heads up that I will be announcing the dates for my first batch of my options course in 2023 very soon. That will be coming on Dec 4.
I don't like to sell myself or my course - I prefer to deal in results. Either people in the course make money or they don't. I think the trade updates I've been sharing speak for themself.
I expect to hold 3 or 4 runs of the course in 2023, so don't worry if slots are full or the timing of this first run doesn't work for you - there will be other opportunities.
Please don't feel like this is something you have to sign up for immediately - I'd much prefer you be in the right headspace with enough capital to be able to make money, rather than rush into it
(I recommend a minimum of $10,000, but ideally $25,000 and up.)
This article is for educational purposes only. This is my own portfolio which is being managed according to my goals and risk tolerance. Your situation is likely different and you should do your own due diligence before investing in stocks or options.