Play Money – February 2016

Since the start of the year, I have expressed a monthly goal of 85 EUR income out of my playmoney. It is exciting to see each month how I do compared to my set goal. Let’s go …

February has been a busy option month. There were no less than 6 ticker symbols that contributed to my “passive” income. There were 4 puts, 3 calls, 1 dividend payment and 1 capital gain.

Premium Income

The total income of premium was 171,6 EUR.

Dividend

There was one dividend payer this month: KMI. It brought in a total of 13,44 EUR

Capital gains

There was one ticker that was sold with a capital gain: GDX. The result is 108,81 EUR.

My covered call experiences so far have been mixed. I like them when they expire worthless. I have a problem with them if the stocks goes on a firm rally. More on that later.

All things considered, February was an excellent month with a total income of 280,86 EUR. This is well above my monthly target of 85 EUR! Let’s pop the champagne!

Why be ecstatic with 280 EUR of income? This is nowhere near our monthly expense.  I know. Remember, this income is generated only with a small part of my portfolio. The actual return is significant. If I do the math, I am close to a 22pct return on capital on an annual basis. This puts another perspective on the number…

Given that both January and February were  such a good months, I decided to change a little the goal. Rather than making the 85 EUR per month out of premium, dividend and appreciation, I now go for making the income out of premium alone. The appreciation and dividend are a bonus of some sort.

The most important for me remains that I keep myself occupied in the markets with my portfolio and that I have fun while not fiddling with my main portfolio. At the same time, I make sure I do not get to greedy or self confident by taking on a massive amount of risk. I have my limits on the open amount of puts that I can have and I follow the principle to trade small and trade often (As teached by tastytrade).

Do you have some February income to report?

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