Thoughts of a mechanical engineer turned programmer turned statistical investor. Here to save you from making mistakes I made at the beginning of my investing career.

Well that week went by hella fast

I want to preface this post and ask you to please interact with my blog! PLEASE 🙂 Whether its to say this is a load of BS, or you like it, or you disagree with something, or something isn’t clear, or it made you think, or WHATEVER! I’m just starting out and I would love to have some interaction with the people who read this. So please like and comment, its what fills my sails 🙂

Secondly, I will do a weekly summary post at the end of every week, in which I will compare my portfolio performance to market performance, mention events that happened which I think are worth mentioning, and probably a bunch of other stuff. Feel free to subscribe to get these posts directly to your inbox in real time 🙂 Although this is obviously not necessary, this content is completely free no strings attached (for now).

Ok then.

To summarize this first week since I started the blog:

Nasdaq -7%, S&P -5%, Rus -3.1% DJIA – Don’t even care, the dow represents NOTHING significant! VIX +23%.

Hab tech: I actually don’t know what I was at at the beginning of the week, I will now make note each week how the week ended. But since my screenshot, which was on the 20th after market close, -2.3%. Arguably at the beginning of the week my porftolio was lower because monday and tuesday were big up days, so from midweek high to end of week I lost 2.3%, arguably less from the beginning of the week. But lets go with 2.3% since I can’t calculate otherwise and I am purely analytical.

So one thing that happened this week is TSLA reported earnings Wed evening.. I actually did a TSLA earning play of a 1000-1050-1075 butterfly which cost 12.4 which I closed just after they reported for 28.5 so pocketed ~$1600 in realized gains:

Ideally I would have put a post up describing the play and showing the risk/reward graph when I did it (so subscribe to get posts directly to your email!!), but this is the beginning of the blog so everything is a bit delayed.

Other than that, I took advantage of the high VIX and GOOGles price to open a bull position. Its a double covered bear put position, calendared (yes I madeup that word), so spread across 2 months, which is actually a bear put position with a short put below it, but I actually made 2 bear put positions over the next 2 months, so if the market does continue down I will make money on the way down. It sounds complicated, but its a net credit and is actually bull position overall (ie a positive delta). Here are the order details, which will make the position clearer as well:

The position graph looks like this, and I’ll explain immediately afterwards:

So with google now at ~2400$, if on expiration google is above 1850 the short put expires worthless and I pocket the initial credit (~500$, so not much). If in the next month google goes down below 2000 (20%, so not likely but possible if this next month is very bad), the May bear put spread (BPS) will go in the money, and I will make up to 10k$ on that spread. If google continues going down below 1900, the June BPS will start going in the money, and will make up to another 5k$, but the second naked put will start losing money at the same time. Overall the likely outcome of this position is it expires worthless and I pocket 500$, but if the market goes bad theres a chance I could make a lot more, even though it could take a while to actually show green. And if the market goes really bad and google drops in the next 2 months below 1850 (ie it went down 2400-1850 = 550$ = 23% in 2 months), then I will need to roll the short put down and out, but it would also mean I pocketed 15k$ realized gains, which I can use to roll out the puts. And if google goes down 23% in the next 2 months that would mean a bunch of horrible stuff happened to the economy.

So that wraps up my week.. This turned into a bit of a longer post that I was planning to do, and I didn’t even get to any background, so for now this blog is fairly advanced. I just wanted to update the blog with the weeks events.

In the future I will make some more posts about theory, investing philosophy, may post some interesting things I come across on the web (or have come across and would like to share now that I have a blog), and obviously any updates I do to my portfolio.

To some green in the coming week!

PS – I might as well also post a screenshot of the portfolio so I have it to compare to next week.

as usual right click open in new tab to be able to zoom in 🙂

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