This Friday is the March expiration cycle. For me, that means that I have a lot of positions to manage in the 2 weeks before. So, what have I been doing? There is good news and there is the rest and then the sad news.
First the good news
I started to play with iron condors – this means a market neutral postion where you let time do the work. These worked out quite well and generated profit in March.
And the rest
I have doubled and then trippled down on RDSA. As a result, I will soon be the proud owner of an additional 200 stock RDSA. For the medium term, I do not mind. We will get oil greedy again and there will be an excess again.
I also need to decide what I do with the accounting of these stock and option trades. For now, I will take the full option premium as a profit and book the stock at strike price +trading fees +taxes. I will report this fully transparent. More on that in the March report
My China trad is still under water. This will take time to recover… for sure… I only get assigned in April.
What does this mean for the rest of the year?
I have a limited budget allocated to, option trading. I boost this by allowing myself some non fully cash secured trades -or trading on a margin. I used to take 130€ risk for every 100€ that I have. SOme do more, some do less. That is what I do.
With the Corona crisis I have reduced my personal margin to 0. That way, I can not go belly up in leverage… I can only go to 0 🙂
So, at this stage with 300 RDSA stock and 100 FXI coming soon, I have very little space left to trade. That money is currently working to survive on some goldmine trades.
That leaves me with 0 EUR left to trade today.
As soon as gold mines go higher, I have additional room: I own gold mine stock that I can use to write calls against. I only do that for a decent profit.
So, for now, no option trading – This is the sad part…
As an opportunity, I am considering to transfer some money from money accounts to the stock market and buy the S&P500. As it is cash intensive (you need to buy per 100), I still need to figure out if I go the SPY route or the VTI route. The advantage of options is that I can decide now on the entry price and that I have a strong handcuff – breakable when I really want – to keep my order to buy during this crisis. That is then maybe the positive news…
How are you doing with investing and trading?