Solid day on back of earnings and China news. Options expiry time brings good news on all the income trades and all the naked puts - bad news on a few short term earnings trades. I am thinking of going back to not trading short term using options.
Portfolio News
Market Rally
Markets moved from nerves to rally.
US markets were buoyed by good earnings and upbeat guidance from chip-maker Broadcom (AVGO) and by positive noises from China NPC, which tabled the new foreign investment legislation.
Brexit Bumbles
The stroll to the edge of the precipice continues
There is talk that Theresa May could table a new vote in Parliament this weEk. Exit day of March 29 is looming. A vote for delay is no more than keeping the UK inside the EU and each day that passes the power of the EU grows. Constituency pressure is building on parliamentarians to give effect to the vote of the people - they voted Exit. "Let's Exit then", they say.
Sold
Sodexo S.A. (SW.PA): Europe Food Services. Price hit take profit target for 9.4% profit since July 2018. In TIB261, I wrote that I quite liked
somewhat uncorrelated with economic growth (health care and seniors, universities, schools) and certainly tariff free.
I exited in one of my other portfolios in February after Fitch re-rated the business (see TIB366). At the time I set an exit target in this portfolio - exit made fully now.
Shorts - Hedge Trades
Vanguard FTSE Europe ETF (VGK): Europe Index. 47/44 bear put spread expired with closing price at $54.66. This was a hedging trade - losing these is part of the cost of hedging. Since this trade was put on, I have progressed my hedging approach to buy ratio spreads to reduce the cost of each hedge. [Means: 2:1 ratio = sell 2 put options for each 1 bought].
In one of my other portfolios, I failed to put in the sold puts to fund the premium = expensive mistake.
ProShares UltraPro Short QQQ (SQQQ): Inverse Nasdaq Index. 16/22 bull call spread expired with closing price at $10.54. I am using this inverse ETF to hedge one portfolio as it is not allowed to hold short positions. I was thinking this through this morning. As I am holding the stock - that is a hedge. Adding a bull call spread does increase the size of the hedge. However, I could just write covered calls against the stock and reduce the hedging cost = just sell the call that I would have in the bull call spread. I will do that from this month on if I can find calls at 15 to 20% above current price.
Expiring Options
Chipotle Mexican Grill, Inc. (CMG): US Fast Food. 500/450 bear put spread expired with closing price at $639. It is not unusual to get a tradng idea wrong BUT this one was monumentally wrong. CNBC Options Action idea looking for a slowing of growth and a slightly soft earnings result. Bought 500 strike put options - price closed at $639 = 27.8% wrong. There was little chance of running any trade management on this as price skyrocketed on earnings. Good news is this was a bear put spread - so the person who bought the 450 strike put options did even worse. The chart shows how wrong the trade was. It was never right apart from the sold put at the bottom - always right that was.
Roku, Inc. (ROKU): TV Streaming. 50 strike sold put option expired with closing price at $62.69. This was part of a call spread risk reversal trade on which I had closed the call spread for profit.
NVIDIA Corporation (NVDA): US Semiconductors. 130 strike sold put option expired with closing price at $169.81. This was part of a call spread risk reversal trade on which I had closed the call spread for profit. On this whole trade, the sold put expiry accounted for 62% of the profit in the trade
The last two certainly look like naked put candidates as I would be happy to own the stock at a lower entry point.
Income Trades
All covered calls expired in my favour = 100% income month. 24 trades written at an average premium of 1.02%
Naked puts on Cisco (CSCO) and McDonalds (MCD) also expired in my favour (0.43% premium).
Cryptocurency
Bitcoin (BTCUSD): Price range for the weekend was $197 (5.1% of the low). Buyers emerged and pushed price on Saturday to test $4000 but were not prepared to go as far as testing the longer term resistance level above that (dotted red line). We have now seen a higher low and a higher high - scope to give that next move up a good go.
Ethereum (ETHUSD): Price range for the weekend was $12 (9.2% of the low). Support level from Thursday proved solid and price made a push higher to make a higher high. Next target through a big area of "no mans land" is $160 (blue ray)
CryptoBots
Profit Trailer Bot No closed trades.
Dollar Cost Average (DCA) list rises to 5 coins with XLM added and doing one level of DCA. Other coins all trade down which is normal when BTC and ETH surge.
Pending list remains at 10 coins with all coins worse.
PT Defender continues defending 10 coins. No change
New Trading Bot Trading out using Crypto Prophecy. Trade closed on BNB for 1.84% profit. Trades remain open on SC, VET, XLM.
Currency Trades
Outsourced MAM account Actions to Wealth closed out 3 trades for 0.15% losses for the day. No open trades.
Cautions: This is not financial advice. You need to consider your own financial position and take your own advice before you follow any of my ideas
Images: I own the rights to use and edit the Buy Sell image. News headlines come from Google Search. All other images are created using my various trading and charting platforms. They are all my own work
Tickers: I monitor my portfolios using Yahoo Finance. The ticker symbols used are Yahoo Finance tickers
Charts: http://mymark.mx/TradingView - this is a free charting package. I have a Pro subscription to get access to real time forex prices
Crypto Prophecy provides a useful tool to identify oversold and overbought coins - https://mymark.mx/CryptoProphecy
March 15, 2019