Stock Trading

[Del]

How's everyone doing so far this year?

SPX is up 10% already near the end of the first quarter. There doesn't seem to be an end to Mr. Market's exuberant mood.

Yesterday the FED announced that they aren't planning to do much of anything with interest rates this year, with a slight bias toward lowering rates if unemployment ever starts to increase. Mr. Market is giggly with pleasure at the thought of nothing.

My IRA is up 25% YTD. Basically, I've made more this first quarter than Mrs. Del will earn by working all year. I'd like to take credit for this, but NVDA and CAVA did most of heavy lifting. Target (TGT) also beats the SPX.

Still, I'm beating SPX by 15%. I have Mr. Piper to thank for urging me to pick stocks and sell calls.

Mr. Piper recommended selling calls at 1% premium relative to stock price. This wasn't working for me during this exuberance. Prices kept crashing through my call strikes, and I was losing more on lost gains than I was getting paid in premiums.

1% premium is equivalent to a delta of 0.3. I started selling calls at delta = .2 (roughly 20% chance of getting called out). This has worked much better. Prices tend to close near my strike price, so I enjoy maximum gain and maximum premium. Sometimes I can even buy the stock back at a price that is less than the strike that I sold, effectively increasing my gains.
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In my trading account, condors have been doing extremely well. I have stuck to my strategy of taking less risk, selling wider condors for less premium, and avoiding the need for expensive adjustments. Slowing down and making fewer mistakes results in faster gains.

Trading Account Balance: $67K
My trading account is up 49% YTD!!!!! About a third of this growth is CAVA. Two-thirds is sale of condors.

I am drawing $1400 per month in cash to supplement the family budget after Bidenflation.

Today converted some accumulated cash into another 100 shares of JEPI. I use JEPI as an emergency cash reserve, set apart from my working cash fund.
==================================

I expect that Q2 and Q3 will see the market meander at this level, as it did last year. Calls and condors will be my primary profit center.

Come October, Mr. Market will start watching the election more closely. That's as far as my crystal ball can see.

[sweetandsour]

How's everyone doing so far this year?

SPX is up 10% already near the end of the first quarter. There doesn't seem to be an end to Mr. Market's exuberant mood.

Yesterday the FED announced that they aren't planning to do much of anything with interest rates this year, with a slight bias toward lowering rates if unemployment ever starts to increase. Mr. Market is giggly with pleasure at the thought of nothing.

My IRA is up 25% YTD. Basically, I've made more this first quarter than Mrs. Del will earn by working all year. I'd like to take credit for this, but NVDA and CAVA did most of heavy lifting. Target (TGT) also beats the SPX.

Still, I'm beating SPX by 15%. I have Mr. Piper to thank for urging me to pick stocks and sell calls.

Mr. Piper recommended selling calls at 1% premium relative to stock price. This wasn't working for me during this exuberance. Prices kept crashing through my call strikes, and I was losing more on lost gains than I was getting paid in premiums.

1% premium is equivalent to a delta of 0.3. I started selling calls at delta = .2 (roughly 20% chance of getting called out). This has worked much better. Prices tend to close near my strike price, so I enjoy maximum gain and maximum premium. Sometimes I can even buy the stock back at a price that is less than the strike that I sold, effectively increasing my gains.
======================================

In my trading account, condors have been doing extremely well. I have stuck to my strategy of taking less risk, selling wider condors for less premium, and avoiding the need for expensive adjustments. Slowing down and making fewer mistakes results in faster gains.

Trading Account Balance: $67K
My trading account is up 49% YTD!!!!! About a third of this growth is CAVA. Two-thirds is sale of condors.

I am drawing $1400 per month in cash to supplement the family budget after Bidenflation.

Today converted some accumulated cash into another 100 shares of JEPI. I use JEPI as an emergency cash reserve, set apart from my working cash fund.
==================================

I expect that Q2 and Q3 will see the market meander at this level, as it did last year. Calls and condors will be my primary profit center.

Come October, Mr. Market will start watching the election more closely. That's as far as my crystal ball can see.

This looks great. I sold everything earlier this year either outright or via calls getting exercised, and have been on the sideline while busy with other things, and watching the S&P drift upward. My Fidelity S&P index fund is still doing quite well as a result; I haven't checked the YTD return lately, but it was up something like 26% last year.

Earlier this year I made a small withdrawal from my trading acct to help out our granddaughter college student, so my goal this year is to build the balance back up in my trading, or so-called, play account.

Another decision that we've made is to begin making all charitable contributions and tithes directly from our IRA, rather than simply writing checks.

And I may transfer all of the cash that's currently on the side, to JEPI. So, there's that.

[Del]

I expect that Q2 and Q3 will see the market meander at this level, as it did last year. Calls and condors will be my primary profit center.

And I may transfer all of the cash that's currently on the side to JEPI. So, there's that.

Mrs. Del took us out for fish fry last night with her friend from work. Friend's husband turns out to be a savvy investor -- he bought "vacation stocks" (airlines, cruise lines) during the covid crash. 200% return in four years.

He also has keen insights as an industrial insider.

He is the sales and service division leader for a company that provides monster air compressors -- the kind that supply pneumatic power to auto factories and oil refineries. Units as big as a house. He also has smaller units for smaller factories -- the size of semi-trucks or a living room.

There has been a recent surge in new factories as the economy recovered strongly after covid. Much was pushed by Biden-bucks urging auto makers to set up for EV's. (I suppose smaller factories are exploiting cheap labor by hiring illegal immigrants.) Anyhow, this build-out has come to an end. Industrial sector is entering a consolidation mode.

My guy is certain there will be a market correction of 15% this year. This is consistent with my prediction that the market will meander for six months or so.

Overvaluations -- based on expectations of endless growth -- are due for correction.

Sitting on cash or JEPI and waiting to buy at lower prices is a strategy.
I'm going to hold my positions and keep selling covered calls.

I suppose a really clever guy could sit on cash as the market corrects and sell puts to buy at lower prices. That's what Warren Buffet does.
I'm not Warren Buffet. I would shoot myself in the foot.
==========================

Fish Fry Guy is also privy to seminars led by monster speakers -- the CEO of Ford Motor, for example. Guys who have the duty to look forward five and ten years, position themselves to endure, and the resources to buy the clearest crystal balls. Industrial titans are predicting a major economic downturn in 2028, as geo-political and economic forces converge. Something on the order of the Dot-Com Bubble of 2000 and the Subprime Meltdown of 2008, with a 50% drop from recent highs.

Generally such market crashes happen every 12 years or so. Major corps need to foresee and survive. Private investors take a punch in the face.

[sweetandsour]

I bought a few shares of JEPI today at it's low for the day.

[Del]

I bought a few shares of JEPI today at it's low for the day.

I bought 100 JEPI at its high of 57.64 on Mar 21.
I knew it was at a relative high, but it doesn't move far or fast. It was just a convenient time for me.

Currently trading at 57.49. I'm down $15 at the moment.
Next dividend is due on April 4. My 200 shares will pay $60 or better.

I intend to hold JEPI and forget about it until I really need some cash.

[Del]

Stock market pulled back today. Looks like the market got spooked by a spike in oil prices (possibly reigniting inflation), as well as comments from some FED officials regarding the unlikelihood of rate cuts.

Yesterday, the big news was ULTA (Ultra Beauty retail cosmetic and salons). They dropped BIG on some warnings from CEO that earnings will likely be on the low end of their past guidance. Biggest loser in the S&P, that day. Unfortunately, I own a chunk of ULTA in my IRA.

As always, I am concerned about the Strategic Petroleum Reserve. I found this chart:



It is astounding how much of our piggy bank Biden robbed in order to influence the mid-term elections -- especially compared to some historical emergencies when we really needed it.

Trump wanted to top off the SPR when oil was $22. Democrats wouldn't let him. Now WTI is up new $87, and WW3 is looming.

[Del]

April 8, 2024


Started working on my taxes.

I am so grateful that TurboTax can automatically import most of my trading data from TD Ameritrade. So grateful.

I have to manually enter some numbers regarding §1256 straddles (condors). Glad to know that I have to do this. Big trouble if I don't!

[sweetandsour]

April 8, 2024


Started working on my taxes.

I am so grateful that TurboTax can automatically import most of my trading data from TD Ameritrade. So grateful.

I have to manually enter some numbers regarding §1256 straddles (condors). Glad to know that I have to do this. Big trouble if I don't!

Good luck. I almost broke even this year; first time in many years. But for the cost of our CPA we would be on the positive side, with an actual refund, an extremely rare occasion.

WRT stocks, all I have invested right now in my play account is with JEPI. All other stocks that I've been watching are still priced above my target price, and the longer I've waited for a dip, the higher they creep up. Sort of a Catch 22 perhaps? I'm sure there's a trading term or acronym for this but anyway it's a rut I'm stuck in at the moment.

[Del]

Good luck. I almost broke even this year; first time in many years. But for the cost of our CPA we would be on the positive side, with an actual refund, an extremely rare occasion.

WRT stocks, all I have invested right now in my play account is with JEPI. All other stocks that I've been watching are still priced above my target price, and the longer I've waited for a dip, the higher they creep up. Sort of a Catch 22 perhaps? I'm sure there's a trading term or acronym for this but anyway it's a rut I'm stuck in at the moment.

XLE is looking very good for the rest of this year. It's pulling back a bit this week. Keep an eye on it.

Energy is still a strong sector. Tech caught everyone's attention, due to the coming AI boom. But energy is a strong second, and still not so highly overvalued as Tech, which is dominated by NVDA a few other mega-stocks. Plus the likelihood of Trump winning in November and unleashing Biden's shackles on American energy. Somebody has to refill the SPR.

CPI data releases tomorrow morning. Fair chance of a significant short-term market drop.
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Somewhere along the way, I picked up an accounting degree and passed the CPA exam. So I feel obligated to do my own taxes.

I'm a complicated tax return. My Turbotax PDF for state and federal is exactly 100 pages long. (17 pages are just trading records. No wonder it took 15 seconds to download from TD Ameritrade!)

Somehow I ended up with a monster refund, about $15,000. Enough that I have to figure out what to do with it. Tax planning for next year is my next exercise.

I did a lot of withholding last year, in anticipation of major profit from trading. Then I made some major mistakes during Q4, and didn't end up with a lot of profit. My plan this year is to hold on to more profit and pay more taxes.

Someone once asked Warren Buffet how he felt about the monster tax bill he had just reported for the year. He replied that he didn't mind paying taxes.... because that meant that he had made a lot of money.

Half of Americans don't pay any taxes, but they are not happy people. They voted for Biden.

[Del]

Another decision that we've made is to begin making all charitable contributions and tithes directly from our IRA, rather than simply writing checks.

I have been intrigued by this tactic.

Apparently, a guy needs to be 70½ or older to play. I'm training for that goal, but I don't expect I will achieve it before 2031.

Apparently, this is a way to get all of one's charitable contributions to reduce his AGI.... and still let him qualify for the standard deduction.

I'm wondering if this could trigger a guy into Alternative Minimum Tax territory. I'm already on the cusp of that nightmare.

https://www.investopedia.com/taxes/can- ... e-charity/