It's Wednesday morning, and it's already been a long week for the market. (My condors expire on Wednesdays, so it has been a very long week for me.)
It's the end of the month. Time to review my trading portfolio and see what I've learned.
Balance and performance:
My trading account started year at $23,500. Currently $30,600. $7100 gain. 30% return, YTD. Average 3.75% per month.
A successful trader expects 3% to 5% per month on total portfolio. I've been at this for five years.... this is the first year that I have achieved this target.
I have a history of losing all my gains during autumn volatility, so I am going to proceed cautiously from here. 30% is good enough already, and I still expect my oil positions to add value by year end.
Market
Big correction at the end of summer now as Mr. Market absorbs the risk of global recession without any safety net offered by the US Federal Reserve. SPX is at 4000 right now, eyeing that mattress of strong support at 3900 which we talked about last May.
NVDA
Trading at $151. Just want to congratulate Tim again for bailing your position at $191. You cut your losses at the top of a swing. Well played!
Copper
This has been a bust. I am down $750 on this position today.... sudden drop due to global recession fears. I expect it will recover somewhat by Sept 16 when my calls expire. I will assess and likely close the position, hopefully with a loss less than $500.
Oil & gas
New position. After 10 calendar days, I remain pleased with my positions in XLE and DRLL. They weathered the market clobbering of last week and trade close to my entry points. I will evaluate setting some protective stops on this asset. If the bottom falls out of the market, I can save some bacon and buy back at a lower price. The fundamentals on this sector are very strong.
In my retirement fund, I moved out of Vanguard Total Index (VTI) and bought DRLL on Aug. 24.
At this moment, after enduring severe market correction --
DRLL - position down $6020
VTI - position down $16,890
Net gain on portfolio - $10,870
Sectors that lose the least during a downturn usually gain the most in recovery.
Iron Condors on Russell 2000 Index (RUT)
This has been my workhorse investment. YTD profits $5700.
Let's update my table of performance in recent weeks:
Week ending; profit/loss:
7/6 $693
7/13 $1194
7/20 $1073
7/27 $-1614
8/3 $1071
8/10 $1328
8/17 $934
8/24 $80
8/31 $1405
Violent volatility the last two weeks has forced me to make expensive adjustments and take on excessive risk. I have a tendency to double-down
(martingale) under adverse conditions. This doubles my risk, and a second big movement could blow up my account.
Investing in condors is like sailing in a small boat. When the water gets too rough, it is best to head into port and wait for calmer weather.