FINALLY I have some time to write up my trading performance from last month. I am very eager to write this one since it was a breakout month for me, earning over $1000 in income from non-dividend related trading activity!
This is my 3rd monthly post on the activities and gains/losses in my other portfolios. These portfolios include Option Income, Swing Trading, Day Trading and P2P Lending. My goal is to reinvest all gains from these activities into either my Dividend Empire portfolio or my Freedom Fund.
In this post I will give an update on how I performed in August, 2016. In July I made a total of $312.40 income from all of my portfolios, $41.04 from dividends and $271.36 from my other portfolios.
My August goal was to break the $500 mark. Well I did that and then some!
I made a total of $1,131.23 in August, crushing my goal and my previous high of $435.70 set in June 2016. Dividends accounted for $88.92 while all other activities produced $1,042.31. The vast majority of this income came from my Option Income and Swing Trading portfolios. My gains were offset slightly by a $54 loss in day trading.
Option Income Portfolio
July 2016 Income: $331.09
August 2016 Income: $570.39
The basic goal of the Option Income portfolio is to generate income from the sale of option contracts. I write (sell) out of the money put contracts on stocks that I wish to own at the price that I wish to own them at. If assigned shares, I simply write calls and collect dividends (if paid) until the shares are called away (detailed strategy).
I closed out a total of 6 positions in July and received one dividend on the HRL shares that were assigned to me back in June.
The VLO, GPRO, NFLX and MON were all closed out prior to expiration because they met my 75% of max gain criteria. A big chunk of my gains this month came from FL. I first sold a FL put back in April and I was assigned 100 shares in May when the stock tanked. I then proceeded to sell calls and collect dividends until the shares were finally called away last month. I collected the full $201.34 premium on the call and basically broke even on the shares.
This FL trade was a bit of a roller coaster and I plan on writing a post on it to show how much money you can make with this strategy when you are WRONG about price movement.
I also opened 5 new positions in August – selling the following put contracts:
I fully expect the F, DAL, MO, and DIS positions to expire worthless though I wouldn’t mind holding stock in these companies if I get assigned. BMY, on the other hand, is one of those rare cases where I sold a near the money put to increase the likelihood of assignment.
I am extremely bullish on BMY and I wouldn’t mind buying shares at the current price. I sold a put which was about $2 below the market price at the time (this contract has since gone in the money) and collected a nice premium. If I end up acquiring these shares, it would be at a significant discount compared to purchasing shares outright on 8/23/2016.
A complete list of all open and closed option positions can be viewed HERE.
Swing Trading Portfolio
July 2016 Income: -$205.26
August 2016 Income: $513.07
In this portfolio I use technical chart analysis (support/resistance, chart patterns, indicators, etc) to take advantage of short-term swings in various stocks. These trades typically last anywhere from a couple of days to several weeks.
Much better than last month! The only thing I need to work on is closing out too early. I have this nasty habit of shooting for $100 gains and quickly locking them in. While this increases my winning percentage, it limits my gains.
Specifically I left a ton of cash on the table with the GPS and PTGX trades. Had I followed my exit strategies I would have made $325 on GPS and PTGX would still be going with a gain (as of 9/23/16) of $585!
I won’t complain too much. Gains are gains…
July 2016 Income: $132.90
August 2016 Income: -$54.09
I use the exact same methods for day trading that I use in my swing trades, just on a shorter time frame (usually the 5- and 15-minute intra-day charts). I trade high-volume, very liquid stocks and futures contracts that have tight bid-ask spreads to avoid slippage.
I made a total of 4 day trades in July: 2 wins and 2 losses. I have really cut back on this activity for two reasons. I simply don’t have the time for it and I have shifted much of my focus to Option Income and, to a lesser extent, swing trading. Moving forward I will simply combine my income from day trading and swing trading since they are essentially the same strategy.
Lending Club Portfolio
July 2016 Interest Received (minus fees): $12.63
August 2016 Interest Received (minus fees): $12.94
This portfolio is straight forward. I use the Lending Club platform to buy notes, which are portions of loans to individuals looking to consolidate debt, make large purchases, etc. Each month I (hopefully) receive payments from these individuals consisting of interest + principle.
The interest that I receive each month is income that can be added to principle and additional contributions to buy more notes, thus keeping the compounding snowball rolling.
Not much to say here. I was able to purchase 4 new notes through gains and deposits so my income should continue to creep up in the coming months.
So far in 2016 I have generated a total of $2,320.65 from all investing activities with $1753.23 coming from non-dividend related trading. My best performing portfolio is still the Option Income portfolio, generating $1354.01 in just 5 months.
My September goal is still $500 since there aren’t quite as many options expiring and I haven’t had much time for swings.