SITTING ON HANDS IS BORING

Man, these 30-45 DTE options are boring. Especially when you’re used to taking profits on a daily basis. This week I still ended up taking some stuff off as I felt like it was the smart thing to do. How so? Well, if I have some positions that are up 50+% with 40+ days remaining, why not take a few positions off “JIC” the market decides to have a small or large pull back? That is exactly what I did.

As a result, I took the following 4 positions to the left which came out to an average P&L percentage of 58%.

Average days held for the 4 positions combine were 10 days. Total gains for the week of 06-01-21 was $436.

BUYING POWER BURNING A HOLE

With portfolio margin turned on and Interactive Brokers giving you 6.7:1 in buying power, I really need to get used to these numbers. Keeping the BP usage to about 35% is ideal for me. WIth RegT 4:1 I was comfortable around 40-50%. Every time I’m lower than 35%, I feel the need to enter some new positions. As a result, I put on 6 PLTR and 2 EOG puts.

MESSING AROUND WITH SPREADS

A recent TastyTrades video I watched about using spreads for BP reduction was quite interesting. Not really using spreads for protection, but merely for BP reduction. So, take this for example: I have on one AMZN PUT 2500 expiry for July 16 21. This single contract on AMZN took up $18,000 in maintenance margin. The income from that one put would be roughly $600. Putting what I learned in the video to work, I tried it out on Friday. I ended up buying a 2000 PUT on AMZN for July 16 2021 expiry. This cost me $123 to buy. As a result, this cut my buying power for the 2500 PUT down to about half. $9K. Lastly, the $600 would now be $600-123=$477 for about 9K in maintenance margin usage. Finally, one could actually put on two contracts for the same BP. This is not what I did. I would most likely put on a different company with the freed up BP.

WEEKLY OPTION METRICS

This week with the $436 income brings the YTD totals to over $25,750 from the options portfolio. This also brings the YTD percentage to 14.31%. Still beating the S&P 500 and still on track to surpass my 24% goal for the year.