Trade The Journey

Trade The Journey

Trading Recap!

Top of the Morning, sending positivity and progressiveness to those in need of it.

Thousands, maybe even millions of jobs have been lost to the effect of shutdowns/closures due to the virus. Some of those jobs will never return.

I read an article last week that stated, 77% of those entering into homelessness are doing so for the first time. I can’t imagine what that feels like for the human soul. The average American has little in savings and, in most cases, can’t cover an emergency.

Stimulus money fueled the economy towards an opportunistic rebound. As the extra money from the government slowed, so did the spending. Most people used the extra money to survive when everything in the economy came to a halt. I surely did, and unfortunately, I saved very little.

Some companies allowed you to skip payments and others did not.

It’s easy to blame everything on the current administration, and we could – from the acknowledgment to the containment. There is still no vaccine available, which means we are still reliant on the next persons’ consideration. Judging by what I’ve seen while traveling, without a vaccine, the virus is here to stay.

This means that many companies likely face quarters with reduced profitability. A stimulus is needed but will it be received before permanent damage to the economy.

The problem is that many of the forces that move the economy go unnoticed to the average person. When events emerge on the News station, they come to public awareness for the first time.

Right now, megatrends are occurring around the world, permanently altering economies. The Coronavirus has sped up the inevitable. With this election, America has the opportunity to choose how we proceed forward. I’m not into forcing my political views onto anyone so whoever you vote for, make sure the candidate best represents what you stand for.

This was my third week of trading credit-spread options, and it didn’t turn out so well. Feeling emboldened by my profits from the last two weeks, I decided to increase the size of my position this past week. I sold and brought two options on each side.

Unfortunately, the plan didn’t turn out as expected. I wasn’t able to adjust my position while working like placing a stop on the position. So the position went in my favor and turned against me quickly. I have to admit, I shouldn’t be using Robinhood to trade options.

The second issue was using an option that had limited liquidity. I couldn’t close my position on the expiration date; therefore, the option was exercised. It’s a scary thought seeing that you over $11,000 in a position.

The third issue was the non-identification of the previous trend. If I had only looked, I would have saw the trend was overall bullish. The stock retreated a bit when Trump made the announcement that stimulus talks would be ended.

The next day the stock recovered the losses, and I was back in a losing position. For profitability, the stock would have had to retreat at least three dollars. It was possible, but looking back, I could have better assessed the strength of the trend.

Value kept moving higher and held higher for the entire week.

I prefer to trade credit options because your wins and loss are defined before entering the trade. You also don’t have to be precisely right only somewhat right. With a weekly options trade, its about forecasting the general direction for the week.

Still, I risked $60 to make $140 which is a 2 to 1 position. I’d take the risk again.

When I completed my first trade, I thought to myself I could do this. So far, I’ve been altogether trading off of the charts. In the coming weeks, I’m going to be learning a bit more about the greeks. I’ve learned more about options by placing and executing the trade than by reading about options.

I feel that this type of trading could be a reliable passive income options strategy for me.

This past week:

Now that I’m back to earning an income, I have to manage my time better. It’s been challenging completing my homework and studying nightly but it’s doable. Yesterday, I woke up sore and tired from the weeks’ activities.

I didn’t need more sleep. I needed some relaxation. Luckily, trading is a form of relaxation, and trading rejuvenates me. Its the one aspect of my life I can learn about endlessly and do without feeling tired.

This past week deserves the grade of a “C” for steadiness. I only ate out one-day last week, and I proud of that.

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