The Politics of Division has put our country in a bleak, dark, and scary funk. Where is Reagan’s “shining city on a hill?” What happened to Obama’s “There are no Red States, no Blue States, just the United States?” We desperately need a national Unifier-in-Chief for 2024.

Hiding in darkness that will continue to spread,
chasing away our fish,
draining life from the island
until every one of us is devoured
by the bloodthirsty jaws of 
inescapable death!

Grandma Tala (Movie: Moana)
(or DNC campaign strategy for the 2022 Mid-Terms)

Help Wanted: Unifier-in-Chief

Grandma Tala
(Movie: Moana)

I am Trade Trudging this 4th of July week. Feeling a bit patriotic (being Independence Day week and all), plus a shortened 4-day trading week, plus a host of other priority time commitments – I’m going to spend my little time this week ranting about our nation’s lack of optimism.

Commentary Content

Biden’s Pessimism

There is an ever-deepening pessimism that has been metastasizing throughout the core of our society over the past three years. The mood of the country is bleak, dark, and scary. We have deep voter cynicism, patriotism is unpatriotic, we are replacing law and order with social justice, high gas prices are intentional to goad us green, and our media’s overt contempt for the constitution has extinguished national pride. Our country is in a deep funk.

There appears to be a covert movement with our nation’s highest leaders to push the US to a new “Liberal World Order.” To achieve this nirvana level for our society, inflation across all sectors needs to be as high as possible, as long as possible, and as painful as possible to goad Americans to transition from fossil fuel to green energy – so says National Economic Council director Brian Deese. This is the Biden Administration Climate Change policy that cannot be announced.

The Democrat’s intentions are good, and I can agree with many of them, but their messaging SUCKS! The “Liberal World Order” (aka Marxism) has honorable intentions and worthy goals. Balancing our economic activities with material conditions sounds great, but with one problem – it can’t be done in a free society. Thus to have a successful Marxist economy, we must have a totalitarian form of government akin to Communism to make it work.

And so, my fellow Americans:
ask not what your country
can do for you –
ask what you
can do for your country. 

– President Kennedy for the inaugural address on January 20, 1961

I wonder what President Kennedy would say about the Democratic Party of today?

When Biden demanded via a tweet that gas station owners must lower their prices, he got support from the China Daily EU Bureau Chief, Chen Weihua. Weihua tweeted back, “Now US President finally realized that capitalism is all about exploitation.” I’m not sure what direction the Biden Agenda is taking us, but I’m pretty sure he was not elected to take us down this path.

Reagan’s Optimism

Where is Reagan’s “shining city on a hill?” What happened to Obama’s “There are no Red States, no Blue States, just the United States?” We need to start stoking our country’s self-worth and national optimism. We need leaders who will inspire confidence and restore America’s morale. We need a national Unifier-in-Chief for 2024.

I will not stand by and watch this great country destroy itself under mediocre leadership that drifts from one crisis to the next, eroding our national will and purpose.

The time is now, my fellow Americans, to recapture our destiny, to take it into our own hands.

– Ronald Reagan’s Acceptance Speech to the 1980 Republican National Convention

Who Should It Be

Historically, in times like these, America comes up with a national figure who campaigns for change. Reagan did it in 1981, and Obama did it in 2008. The pursuit of happiness is our unalienable right.

The national leaders who, I believe, are the most divisive and the antithesis of national optimism and that I would not want to see in 2024 are Joe Biden, Donald Trump, Nancy Pelosi, and Chuck Schumer.

People want to be proud of their country, optimism is a winning strategy, and pessimism never won any battle. 

The people you love will change you.
The things you have learned will guide you.

Chief Tui (Movie: Moana)
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This Week’s Market Sentiment

This Market Sentiment Section is typically completed by midday Monday morning. By the time this journal is published, it will be a week old.

(As of 06/27/2022)

This section reviews five indicators: Ecopolitical events, VIX, Put/Call Ratio, Consumer Sentiment Index, the S&P 500, and how these could affect the market’s direction. Then, I will use these indicators to help guide my trading decisions for this week.

Each of my five indicators will “vote” on a DEFCON (Damocles Options Trading Readiness Signal) level, exclusive to that indicator. Then, In the final sub-section, “My sentiment for this coming week,” below, I’ll compile the votes into a DEFCON level for the week.

Ecopolitical Influencers

Ecopolitical (Sociopolitical-Economics) Influencers (EPIs) can be breaking news, political machinations, Federal Reserve musings, or even Twitter Trends. They are events that can abruptly change the dynamics of the current markets. U.S. political polarization’s impact on Wall Street cannot be glossed over.

EPIs are like a lit fuse to a bomb. The fuse can be fast or slow, and the bomb can easily be a dud. But I need to watch this closely as an indicator. The EPIs can significantly disrupt all the other indicators at the drop of a tweet.


Yikes – Yawns – Yays

  • Russia lower’s the Iron Curtain – Yikes
  • Biden’s Build Back Better 2.0 – Yikes
  • DOW’s worst start in 60 years, S&P in 50 Years – Yikes
  • June’s Jobs Report is due out this Friday – Yikes
  • Wednesday’s release of Federal Reserve’s meeting minutes – Yikes
  • Factory output falls to 2020 lockdown level – Yikes
  • Misery Index over 12% – Yikes
  • Feds back 0.75% interest rate hike in July – Yikes
  • Biden’s demand to bring down gas prices – Yawn
  • Election year fearmongering escalates – Yawn
  • Global supply chain easing? – Yay
  • Gas and oil starting to decline – Yay

Geopolitical

  • With fists on hips and a stern glare, President Biden raises a crooked accusatory finger and demands that gas station owners lower their gas prices – “and do it now!”. “This is a time of war and global peril,” Biden tweeted on July 2. The war he refers to is the US mid-term election, and high inflation is really screwing the Democrat’s chances. And the global peril is if the GOP takes control, we won’t be able to pack the Supreme Court, Nationalize elections, dictate climate requirements, spend trillions for new social services, and otherwise inflict our perspective of ‘social justice’ on the country.
  • Finland and Sweden to join forces with NATO, US sent Billions of dollars of military aid to Ukraine, UK ups defense spending to 2.5% of GDP, and NATO states pledged to send hundreds of thousands more troops to Eastern Europe – the Iron Curtain has lowered once again, and the Cold War is reigniting.
  • The Democrat leadership in the Senate is preparing to retry Biden’s Build Back Better package in July before Congress goes on recess and just in time for the mid-term elections. It is unknown if the Dem leaders have swayed Joe Manchin to support the expensive social bill. If they did, I would imagine that the bill’s name would have changed to Build Back meagerly.

Socioeconomics 

  • Last week the core PCE slightly moderated in May. Yes, it rose to 4.7% from a year ago, but it was down from what it was projected. This is the 3rd straight month of moderating prices. This series of moderation is being interpreted by Yahoo’s Morning Brief as a good sign that the global supply chain starting to come back together. 5 of the Federal Reserve Banks’ 12 districts have suggested that the supply-chain tangles in their area have significantly improved. Shortening delivery times should translate into a moderation of inflation.
  • This year’s bear market began on the first trading day of 2022. And six months later, has mauled the markets to their worst start in half a century (S&P 500 down 20.6%). The NASDAQ fell nearly 30% as most of my tech stocks took it on the chin. Some analysts are suggesting that I could see another 15% go the way of the bears.
  • One closely monitored component of inflation is gas prices. Even as we head into the 4th of July holidays, the national average at the pump has fallen to $4.84/gal as of July 1, and oil fell below $100 barrel on July 5. June’s prices peaked at $5.03/gal.
  • The Fed’s tighter rates policies are expected to slow employment growth. This week’s Jobs report is expected to show just that. Following May’s report of nearly 400K new jobs, the expected 275K payroll count for June is going to seem dismal. But I have to keep in mind that the average pre-pandemic job’s count was 150K – 200K, and that was considered strong.
  • The Federal Reserve will release the minutes from its last meeting this Wednesday. I’m expecting some narrative that inflation is slowing, but a recession is going to be inevitable.
  • The Institute for Supply Management Index fell below 50% in June. Demands for factory products fell sharply last month as high inflation and a slowdown in consumption are taking their toll. The manufacturing employment index also fell in June, dipping to 47%. Manufacturing slowdown is a confirmation that the Fed’s aggressive tightening is having the intended effect. And this slowdown may be the first sign that inflation may have peaked.
  • China is slowly opening its COVID-closed doors, but it is going to take them some time to ramp up commerce.

The systemic issues keeping pressure on the markets have not changed: War in Ukraine, high/rising inflation, China shuttered, oil price high, and sucky Consumer Sentiment. So, I’m keeping with the DEFCON 2 until one of these five starts to let up.

ETS votes an optimistic DEFCON 2

VIX: Broad Market Volatility

The VIX is an emotion-gauge for the general investing population. It is thought to be driven by the Marketeers’ current level of greed or fear. As one-month forward-looking volatility, it is not designed to tell us which direction the market will move but rather how fast it can get there.

A VIX of 15% is assumed to be a market at rest. Since the intrinsic nature of the Stock Market is to move up, a VIX close to 15% or below will correspond with the market’s innate tendency to rise.

ThinkorSwim Chart: CBOE Market Volatility Index (VIX) - 07/03/2022
- OptionsTradesByDamocles.com
ThinkorSwim Chart: CBOE Market Volatility Index (VIX) – 07/03/2022

The 4-week trajectory of the VIX Regression Channel continued its track towards more volatility but has moderated over the past three weeks.

  • Last week the VIX ended mostly flat at 28% from 27% the week before
  • The VIX spent most of the previous two weeks below the 30.0% line
  • The current VIX dropped sharply below the 9-Day and the 120-Day SMA
  • The 9-Day SMA is above the 120-Day SMA

The VIX’s high volatility is good for collecting premiums or pushing the Short-Strike further out. However, this still confirms that a bear trajectory is likely for the next few weeks.

VIX above 30% is my demarcation for a DEFCON 2. But to get back to a DEFCON 3, the VIX needs to be below 30 and the 14-Day trajectory needs to move towards less volatility (which it is)

Being blind to all other indicators, I will vote for an optimistic DEFCON level 2

VIX votes a cautious DEFCON 3

Put/Call Ratio

Put Options are frequently used as protection against existing investments falling. When the ratio between Put Options bought and Call Options bought rises, this indicates that the Marketeers are buying insurance for what they may see as declining markets (or a pending market collapse). Conversely, when the Put/Call Ratio falls, there is a general sense that the broader markets will increase, and more investors are buying more than selling.

ThinkorSwim Chart: S&P 500 Put/Call Ratio - as of 07/03/2022
- OptionsTradesByDamocles.com
ThinkorSwim Chart: S&P 500 Put/Call Ratio – as of 07/03/2022
  • The S&P 500’s Put/Call Ratio was pushed back above the 0.75 line before settling on the 0.75 line.
  • The 9-Day SMA remains dipped below the 0.75 line, suggesting a slight market change.

The Put/Call Ratio spiked early last week but recovered to the mid mark between trouble and safe.

Being all so slightly in the Good Shape region (or more specifically, not in the Nervous region), I will give this week’s indicator a cautious DEFCON 3.

Put/Call Ratio votes a cautious DEFCON 3

Investors’ Sentiment

Marketeers are people too. And when the economy is humming, investments are smoking. Conversely, when the economy is threatening their portfolios, they tend to run for cover.

Consumer Sentiment Index

A low Consumer Sentiment Index is a general dissatisfaction with our current management of U.S. economic policies. This dissatisfaction will imply that something has to change. A high satisfaction rating suggests approval of the current policy management and implies market stability. Surveys of Consumers (umich.edu)

Consumer Sentiment Index as of 06/24/2022
- OptionsTradesByDamocles.com
- Options for beginners
Consumer Sentiment Index as of 06/24/2022

June’s final results weren’t too much different from the preliminaries reported two weeks ago. But it is still over 14% down from last month and over 41% down from last year. As a trajectory, these levels continue to showcase the doldrums of Biden/Progressive financial policies.

Misery Index

With the copious amount of economic pressures throughout the nation this year (inflation, employment, interest rates, etc.), knowing what the Misery Index is, and what direction the index is moving can cast a long shadow on Marketeer’s sentiment. Numbers are coming from the U.S. Bureau of Labor Statistics (bls.gov).

  • Inflation Rate: rose 1.0% in May. Now up to 8.6% from a year ago.
  • Unemployment Rate: May rate = 3.6%. Unchanged from 3.6% in April.

Misery Index = 12.2% (8.6% + 3.6%). Slightly up from 12.1% last month.
(Note: Ideally, the Misery Index should be well below 10% for a growing economy.)

The Misery Index continues to climb as half of all consumers believe our economy is moving in the wrong direction.

CSI votes a dismal DEFCON 2

Market Trajectories

The S&P 500 is a stock market index that tracks the 500 largest companies in the U.S. This index represents about 80% of all the capitalization for the country. The S&P is widely considered the best indicator of how all the U.S. markets are performing.

The Russell 2000 Index is commonly considered an indicator of the U.S. economic direction due to its focus on small-cap companies. The growth potential of small-cap stocks is attractive to Marketeers when economic expansion is expected. These same small-cap stocks are also the first to be jettisoned at the start of economic turmoil.

S&P 500 (SPX) = 3825 – down 2.2% from 3912 last week. (4 weeks deviation: 150 down from 184 last week)
Russell 2000 (RUT) = 1728 – down 2.2% from 1766 last week. (4 weeks deviation: 80 down from 91 last week)

ThinkorSwim Chart: Daily S&P 500 Index 
Four/Two Months Trend (Updated 07/03/2022)
- OptionsTradesByDamocles.com
ThinkorSwim Chart: Daily S&P 500 Index
Four/Two Months Trend (Updated 07/03/2022)
ThinkorSwim Chart: Daily Russell 2000 Index 
Four/Two Months Trend (Updated 07/03/2022)
- OptionsTradesByDamocles.com
ThinkorSwim Chart: Daily Russell 2000 Index
Four/Two Months Trend (Updated 07/03/2022)

Market Performance

4 Weeks Thrashing of SPX = +/- 150 points or 3.9% of the market’s volume is down from 4.7% last week.
4 Weeks Thrashing of RUT = +/- 80 points or 4.6% of the market’s volume is down from 5.1% last week
(Market Thrashing below 1.0% might be a confirmation of the markets moving mostly sideways.)

  • All trends continue decisively bearish
  • Thrashing is high
  • 9-Day SMA is bullish

Dropping 2.2% was a correction to the 6% pop from the week before. All told, for the volatile past two weeks, the trajectory is still bearish.

Last week’s drop of 2.2% did not take away the nice run the week before. This might be a sign that the Marketeers are seeing a slowdown in the bear trajectory in the near future. But I would not count on that until I see a high volume of cash returning to the markets.

Being blind to all other indicators, I’ll go with an optimistic DEFCON 2.

Market Index votes an optimistic DEFCON 2

My sentiment for this coming week:

Of the five indicators:

  • Ecopolitical Influencers have many systemic issues – optimistic DEFCON 2
  • The VIX is above 30% – cautious DEFCON 3
  • The P/C Ratio in good shape – cautious DEFCON 3
  • Investors’ Sentiment shows a consumer base not excited about our economic future – dismal DEFCON 2
  • The market indexes remain bearish – optimistic DEFCON 2

All my technical indicators showed depressed Markets.

Trading Readiness Level for this week

Optimistic DEFCON 2

This Week’s Guidance

  • Some of the Ecopolitical Influencers are showing signs of cracks. The aggressive bear trajectory may start to slow.
  • Due to my epic losses in May, my Options Buying Power (OBP) is down to $1,656.
  1. Open one Vertical Bear Call Credit Spreads (limited to OBP)
  2. Open one Iron Condor (limited to OBP)

Entry Rules

Vertical Bear Call Credit Spread (DEFCON 1, 2):
  • Entry Rule 3: Prob-OTM >= 85%
  • Entry Rule 5: Call Short Strike >= 1 Standard Deviation
  • Entry Rule 13: Strike-Width >= 10 (sum of all contracts)
Iron Condors (DEFCON 2, 3, 4):
  • Entry Rule 3: Call Prob-OTM >= 85%
  • Entry Rule 3: Put Prob-OTM >= 90%
  • Entry Rule 5: Call Short Strike >= 1 Standard Deviation
  • Entry Rule 5: Put Short Strike <= 1 Standard Deviation
  • Entry Rule 13: Strike-Width >= 20 (sum of all legs and contracts)
Vertical Bull Put Credit Spreads (DEFCON 4, 5):
  • Entry Rule 3: Prob-OTM >= 100% (No Bull Spreads)
  • Entry Rule 4: Put Short Strike <= 1 Standard Deviation
  • Entry Rule 13: Strike-Width >= 20 (per leg)

Exit Rules:

  • Early close following this schedule:
    • 85% of max-gain if 4 or more weeks out
    • 90% of max-gain if 3 or more weeks out
    • 95% of max-gain if 2 or more weeks out
    • Let expire if less than 2 weeks out
  • Roll or Close Spreads within 1 week of expiration if:
    • Short Strike is ITM, or
    • Short Strike < 1.0% below the current price and 1-week trajectory is bullish, or
    • Short Strike < 55% POTM and 1-week trajectory is bullish
    • In a bull market, do not roll Bear Spreads
    • In a bear market, do not roll Bull Spreads
  • Allow NO leg to expired ITM and be assigned!

(Note: The markets have been collapsing for over four months, and I do not think we are toying with the bottom yet. Therefore, it will be unwise to roll any Bull Spreads.)







Profit and Loss Statements

(As of 07/08/2022)

Cash Balance Sheet

Year
2022
Month
Jun
Week
#27
Beginning Account Balance$28,000.00$16,656.05$16,656.05
Deposits (Div. & Int.)$1.29$0.00$0.00
Withdraws1, 2-$3,152.19-$0.00-$0.00
Premiums on Open$11,975.00$0.00$0.00
Premiums on Close-20,083.20-$0.00-$0.00
Fees Paid (total)-$84.85-$0.00-$0.00
Ending Account Balance$16,656.05$16,656.05$16,656.05
Total Gain/Loss-$11,343.95$0.00$0.00
ROR0.0%0.0%
ROC-40.5%
1 Paycheck = 22.5% of initial investment paid out monthly
2 Margin Interest Payments

Note: no new Spreads opened this week.

Cash Flow Chart

YOD Vertical Credit Spreads Cash-Flow Chart - As of 07/01/2022 (Excel Chart)
- OptionsTradesByDamocles.com
YOD Vertical Credit Spreads Cash-Flow Chart – As of 07/08/2022 (Excel Chart)

Note: Negative weeks 4, 8, 12, and 25 were solely from withdrawing my monthly paycheck. The other negative weeks are from losing positions plus monthly paychecks.

My Performance vs. SPY

Hypothetically, instead of depositing $28,000 in my Options Trading Account, could I have done better if I bought $28,000 of the ETF/SPY instead?

Options Trading
Account
SPY
(Fictional)
Initial Investment
(As of Jan 4, 2021)
$28,000.00
(Cash)
$28,000.00
(58.9523 shares @ $474.96)
Funds Added$11,976.29
(Premiums)
0.41 shares
(Dividends Reinvested)
Funds Removed-$20,168.05
(Early Close & Fees)
$0
(Fractional Shares Sold)
Market Changes-$777.00
(Open Spreads’ Fair Market Value )
-$5,230.45
(Gain/Loss)
Ending Balance$19,031.24
(Mark-To-Market)
$22,749.55
(59.3596 shares * $383.25 CV)
ROI-32.0%-18.8%
As of 07/07/2022, 06:19 AM







Schedule for this Week

Goals for this week: (07/05/2022 – 07/08/2022) (Week #27)

  • Document lessons learned or new thoughts in Commentary Section
  • Open one or two Vertical Options Spreads
  • Update Trading Log as trades occurs

Monday:

  • Determine/update this week’s market sentiment section
  • Review/tweak Trend-Channels for all stocks on the watch list
  • Set target expiration dates for all Options as follows:
    • Bull Credit Spreads: Aug 26, 2022 (6-8 weeks)
      Note: If there are no Options Chains published for the 8-week expiration, then use the next Options Chain down from 8 weeks (7 weeks, 6 weeks).
  • Look up Ex-Dividend dates for positions in/approaching ITM (MarketWatch/Calendar)
  • Stage possible trades for all watch list stocks by 10:00 AM
  • NO TRADING BEFORE 10 AM. (Let the market find its direction after the early trading.)

Tuesday – Thursday:

  • Review how yesterday’s staged trades moved. Then, adjust premiums to take advantage of movements.
  • Submit a couple of Spreads, but keep a close watch. If one is accepted, cancel the others (we want only one new active trade open on any one day).
  • Be mindful of this week’s rules.

Friday:

  • Review the total technical dollars at risk for this week. If significantly below $500, then submit additional spreads if prudent.
  • Update and post a weekly journal (this blog) with any lessons learned or strategy changes.
  • Watch one Webcast or take one online mini-course to be completed by Friday.

This Week’s Trade Activity

(As of 07/08/2022)

Spread Count Summary:

Year
2022
Month
Jul
Week
#27
Vertical Bull Put Credit Spreads2500
Vertical Bear Call Credit Spreads1300
Iron Condors300
Total4100

Note: no new Spreads this week.

Current Dollars at Risk:

Year
2022
Month
Jul
Week
#27
Vertical Bull Put Credit Spread$0.$0.$0.
Vertical Bear Call Credit Spread$11,185.$0.$0.
Iron Condor$2,387.$0.$0.
Total Dollar Risk$13,572.$0.$0.
Max Risk Allowed$28,000.N/A$4,000.

Note: no new Spreads this week.

Options Buying Power:

Unallocated dollars available to open new Vertical Credit Spreads:

Current Cash Balance$16,656
Set-Aside Dollars for Existing Spreads-$14,000
Cash Available for New Spreads$2,656
(Options Buying Power)







Vertical Spreads Opened This Week

(06/27/2022 – 07/01/2022)

No new Spreads opened this week. The primary reason is the lack of available at-risk cash (Options Purchasing Power = $1,656).

Note: this is the place I got into when I had such a massive losing month in May.

Vertical Spreads Currently Cooking

(As of 07/08/2022)

QQQ:320c/330c/X2 – Open 06/29/2022 – Expires 08/19/22 – Max Gain = $158.00 – Open Price = 281.85
(Vertical Bear Call Credit Spread)
At Open: Prob. OTM= 89.8, Headroom= +13.5%, Max Loss= $1,842, AROR= 60.6%
Now: Prob. OTM= 87.3%, Headroom= +10.8%

QQQ:325c/335c/X2 – Open 06/21/2022 – Expires 08/19/22 – Max Gain = $162.00 – Open Price = 282.21
(Vertical Bear Call Credit Spread)
At Open: Prob. OTM= 90.3, Headroom= +15.2%, Max Loss= $1,838, AROR= 53.9%
Now: Prob. OTM= 90.8%, Headroom= +12.5%

DIA:335c/345c/X2 – Open 06/30/2022 – Expires 08/12/22 – Max Gain = $120.00 – Open Price = 307.90
(Vertical Bear Call Credit Spread)
At Open: Prob. OTM= 91.3, Headroom= +8.8%, Max Loss= $1,880, AROR= 53.3%
Now: Prob. OTM= 91.7%, Headroom= +7.9%

SPY:415c/425c/X2 – Open 06/23/2022 – Expires 08/05/22 – Max Gain = $160.00 – Open Price = $376.95
(Vertical Bear Call Credit Spread)
At Open: Prob. OTM= 89.8, Headroom= +10.0%, Max Loss= $1,840, AROR= 72.9%
Now: Prob. OTM= 91.5%, Headroom= +8.3%

IWM:190c/200c/X3 – Open 06/15/22 – Expires 07/29/22 – Max Gain = $148.00 – Open Price = 379.29
(Vertical Bear Call Credit Spread)
At Open: Prob. OTM= 92.7, Headroom= +15.1%, Max Loss= $2,859, AROR= 41.0%
Now: Prob. OTM= 94.6%, Headroom= +10.8%

SPY:420c/430c/X1 – Open 06/15/22 – Expires 07/29/22 – Max Gain = $74.00 – Open Price = 379.29
(Vertical Bear Call Credit Spread)
At Open: Prob. OTM= 91.2, Headroom= +10.7%, Max Loss= $926.00, AROR= 65.4%
Now: Prob. OTM= 96.3%, Headroom= +9.6%

SPY:445c/455c/355p/345p  – Open 06/08/22 – Expires 07/22/22 – Max Gain = $145.00 – Open Price = 415.60
(Iron Condor)
At Open: Prob. OTM= 87.8, Headroom= +7.2%c/-14.5%p, Max Loss= $857.00, AROR= 138.4%
Now: Prob. OTM= 99.8%c /89.0%p, Headroom= +16.1c% / -7.0%p

QQQ:345c/355c/255p/245p  – Open 06/07/22 – Expires 07/22/22 – Max Gain = $122.00 – Open Price = 310.16
(Iron Condor)
At Open: Prob. OTM= 90.5, Headroom= +11.3%c/-17.7%p, Max Loss= $880.00, AROR= 110.6%
Now: Prob. OTM= 99.9%c /92.8%p, Headroom= +19.5c% / -11.7%p







Vertical Spreads Closed This Week

(As of 07/08/2022)

SPY:440c/450c/355p/345p  – Open 06/01/22 – Expires 07/08/22 – Max Gain = $134.00 – Open Price = 409.59
(Iron Condor)
At Open: Prob. OTM= 89.3%, Headroom= +7.3%c / -13.4%p, Max Loss= $868.00, AROR= 150.4%
At Close: Prob. OTM= 99.9%, Headroom= +15.4c/-7.4p, AROR= 150.4%

Income to open: $1.34 premium collected * 100 shares * 1 contracts = $134.00
Cost to close: $0.00 premium paid * 100 shares * 1 contracts = $0.00 (expired worthlessly)
Net Profit = $134.00 to open – $0.00 to close – $2.00 fees = $132.00
AROR = ($132.00 / 37 days in play) *365 / $868.00 = 150.0%

Conclusion

Can selling options for income be considered a Home Business? Can I make money at home by selling Vertical Bull Put Credit Options Spreads? These are questions that I am trying to answer for myself.

Three years ago, I set out on a task to see if I could make a retirement income from home by trading Stock Options. I was an Options Trading Beginner, began with NO knowledge of Options mechanics and only $8,000 to risk. And because I learn best when I write things down, I have documented every step of the way (every bonehead mistake, process epiphanies, interconnecting events, externalities, and so on).

This blog is my Options Trading Journal for beginners (me). I will record my weekly Options contract buys and sells in hopes of gaining experience.

Experience is the ability to recognize that
I’m about to make the same mistake again.

– Damocles

Disclaimer

Even though I have tried to make it clear that this blog is my personal trading journal, it has been suggested by others that I, nevertheless, include a general disclaimer. So here goes…

“This blog and the information contained herein are not intended to be a source of advice or analysis concerning the material presented. The information and/or documents contained in the blog do not constitute investment advice.”







OptionTradesByDamocles.com
OptionsTradesByDamocles.com