November Passive Income

Winter is coming… Ski holiday is only 3 weeks away… That is a nice outlook. With November behind us, it is time to look at my passive non-working income.

I have 3 sources of non-working income in my portfolio: dividends, capital gains from trading and option premium income.

November has only income in option premium and some small dividend income.

Option Trading

There was 341€ of option income last month. Not a bad month for me. With almost one year of active option trading, this is slightly above my YTD average.  I should buy my wife and me a nice glüwhein on the ski slopes. What do you think?

passiveincome201611

Numbers do not tell the full story. I try to be as transparent as possible in my option story, showing you the good news and the bad news.

This month, I got actually assigned for the first time stock. This means I sold a put and someone decided to use his right to sell the stock at the strike price. I had the obligation to buy the stock. I was scared for about 5 seconds, then the rationale kicked in. Remember, I write puts on stock I would not mind owning.

The option had a strike a of 28USD and now the stock trades around 21USD. That is a loss of 7USD per stock, so, that makes 700USD. So, where is that loss? For now: nowhere! Why? It is a paper loss. As long as I do not sell, it is not a real loss. I apply the same rule on gains. I have stock I bought at 16, that now trades 22. That paper gain is also nowhere. My trading reporting deals only with realised losses and gains.

Dividend Income

November was rather skinny: 7,59 EUR of dividend income.

December looks better, with the dividends from RDSA, SOLV and BPOST coming in. That should be my best month of the year. Although I do not consider dividends as part of my core strategy, I do like the dividend return that beats the interest on a savings account. When I manage to build up a Belgian based dividend portfolio, I could start to see this as an alternative for my savings account. The home bias is a non issue due to my investments in trackers that cover the whole world. Let me sleep on it.

How was your November month?

 

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12 thoughts on “November Passive Income

  1. Ciao ATL,
    Which one was the stock that got assigned? I guess you are up to managing the position now right? As to the mulled wine I’d buy that ANY TIME even if you made a loss! 🙂
    Ciao cai
    Stal

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  2. You’ve taken the right approach to the option selling, and not minding owning the stock helps I’m sure. Hopefully it’ll bounce back up for you and negate those paper losses!

    Enjoy your upcoming time off. I’m looking forward to holiday vacation. We will be heading back to the Midwest to visit family and should be a nice relaxing time.

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  3. Awesome job writing puts on stocks that you don’t mind owning. Makes for a much better feeling if you’re on the wrong side of the option trade. Hope you have an awesome time on the slopes this winter!!!

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  4. hey ATL,

    Nice work with your option trading!
    I think this is the right mindset. Dont mind if you have to buy the stocks. You can sell covered calls against the position 🙂
    I am doing this all year long.

    best regards
    Chri

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  5. Nice job with your options income. That source can definitely make up for any shortfall in dividend income. While options are nice don’t neglect your dividend income as it’s a lot more reliable and predictable than options income. Thanks for sharing.

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  6. Hey ATL, nice job. You got more dividends than us in November lol 🙂 It’s really impressive how you’re making your money work for you – over 300 euros is a very nice additional amount of money to play with.

    Tristan

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