So I did some fun portfolio performance analysis this morning to try to better establish the level of risk and reward I have been taking with my strategy. (I've been primarily trading NVDA and it was much easier to evaluate than TSLA.)
So in a wild bull run, I started trading NVDA when it was $722 in mid-February, so up roughly $500 or 67%. For the number of shares I could have purchased at the time (cash and some margin), my unrealized gain would have been equal to what I realized mostly selling -P's. But, in the process I also acquired the same number of shares that I would have been able to buy at the beginning, with a cost basis of $900. Essentially I made an extra 50% return selling puts. My total return is equal to 45% of my capital trading reserve (for lack of a better term-- the total money I am willing to spend buying shares to cover assignment) over four months.
TSLA wasn't as good. I am essentially even with the stock trading flat. IV has been too low to justify selling options for me; there are so many extra variables that come into play when you can't take advantage of theta decay.
My one-off trade in SMCI was far too stressful for me. The quick gain in LULU for one week was actually ~5% of my total gains for the period. I scalped a little on AAPL, but no noteworthy income.
Just thought I would share; people talk a lot about individual trades but total performance has been harder to find. In the end, the last four months options performance is roughly my annual spending or annual tax bill in a period the portfolio would have otherwise been fairly flat. I just wish I had started doing it a year or two ago rather than watch my stocks go almost nowhere. I think the stock portion of my portfolio over the last two years is the worst 2-year period I have had in 25 years!
So in a wild bull run, I started trading NVDA when it was $722 in mid-February, so up roughly $500 or 67%. For the number of shares I could have purchased at the time (cash and some margin), my unrealized gain would have been equal to what I realized mostly selling -P's. But, in the process I also acquired the same number of shares that I would have been able to buy at the beginning, with a cost basis of $900. Essentially I made an extra 50% return selling puts. My total return is equal to 45% of my capital trading reserve (for lack of a better term-- the total money I am willing to spend buying shares to cover assignment) over four months.
TSLA wasn't as good. I am essentially even with the stock trading flat. IV has been too low to justify selling options for me; there are so many extra variables that come into play when you can't take advantage of theta decay.
My one-off trade in SMCI was far too stressful for me. The quick gain in LULU for one week was actually ~5% of my total gains for the period. I scalped a little on AAPL, but no noteworthy income.
Just thought I would share; people talk a lot about individual trades but total performance has been harder to find. In the end, the last four months options performance is roughly my annual spending or annual tax bill in a period the portfolio would have otherwise been fairly flat. I just wish I had started doing it a year or two ago rather than watch my stocks go almost nowhere. I think the stock portion of my portfolio over the last two years is the worst 2-year period I have had in 25 years!
