Every trader should look back and review the actions and trades from time to time. Weekends and holidays are a good time for this.
Believe me all good trades do this review. Otherwise they will not be profitable. The way of reviewing may be different for every trader but there is no avoiding it.
In the early days of this blog, I was unsure about the likely content.
I wrote some general articles about trading. Then came up with a two month series about how to pick stocks for trading. Those selections proved successful and then in consultation with readers a series on Option Buying commenced from May 2018 series.
Option Buying has been the dominant theme of this site.
We know that Option Buying is not every traders favorite for all the right or wrong reasons.
That led to looking for strategies which would deliver profits consistently.
I began with The Lazy Trader which is a hedged futures strategy.
Then came up with a hedged options strategy with banking stocks. This strategy was named — Money In The Bank.
It has lived up to its name so far.
Modified the lazy trades with option selling and named it Not So Lazy.
This strategy has been on the blog for 3 months.
And in July 2020, a simple strategy with weekly NIFTY options was introduced to take advantage of the diminishing time premiums every week.
Today we review the performance of all that is going on.
We have not seen profit after the huge gain in March 2020 Series. There were losses in April, May and June. In July too we are looking at a big loss.
It is a cause of concern. For me it is a matter of keeping the belief and not giving up. I know that profit in February and March had also come after failing badly in previous few months. Trades can go wrong for an uncomfortable period of time. We just have to wait it out.
For the year 2020, the profit till June in this series is Rs. 256014.
Even if we consider July as a total loss, the profit would still be around Rs. 192000.
Those who look at the numbers only after March 2020 will surely not find it good. But trading is a continuous process. I look at overall numbers.
And those numbers are still good though they could have been better.
The Lazy Trader:
This series has been a disappointment.
Profit till June 2020 for 11 month period was Rs. 68871.
Profit in July was Rs. 89433.
Profit in 12 month period August 2019 – July 2020 = Rs. 148304.
Not something to talk too much about.
This strategy is based on out performance by heavy weight stocks and unfortunately banking stocks have had poor run this year.
Maybe next 12 month will give better results.
Not So Lazy :
This is a modification of The Lazy Trader. This is a set up with selling PUT options of top 10 heavy weight stocks and hedging with buying NIFTY PUT options.
The performance for three months:
May 2020 — (-) Rs. 14433
June 2020 —- Rs. 62365
July 2020 —– Rs. 91754
Profit for 3 month period — Rs. 139686
A good show so far.
The margin requirement is less as compared with lazy trades.
We keep practicing and see how it performs in future.
Money In The Bank:
This one is a gem.
This strategy has not disappointed so far. Simple to set up, easy to monitor and getting good returns most of the time.
This series was started from November 2019.
Profit over 8 month period till June 2020 was Rs. 204384.
Profit in July 2020 — Rs. 16246.
Profit in 9 months period —- Rs. 220630.
Good going and we expect this journey to be exciting and profitable.
It is too early to form an opinion about the effectiveness of these trades. July trades have given the following results:
July 02 —- Rs. 3525.00
July 09 —- Rs. 2827.50
July 16 —- Rs. 5688.75 ( two set ups )
July 23 —- Rs. 3292.50
Profit in 4 weeks ( 5 set ups ) — Rs. 15333.75
The results are wonderful up to now. We know there shall be few losses along the way but the principle of the trades is right. As long as execution remains right, good results will happen.
We are having a tough time with Option Buying currently.
Everything else is fine.
The blog is about Options Trading not just about Option Buying though that remains my most favorite part of it.
We are doing well currently.
The theory is sound, execution is simple and the results are good. What could one want more?
I thank all the readers who visit these pages and give me encouragement to write day after day.
Trading is simple.
I believe this blog proves it.
Thanks for reading.
Enjoy the holiday.
Disclaimer: This post and examples are for teaching purpose only and are not meant as advice/suggestion to trade in these stocks. Trading in Futures and Options can lead to big losses and should be done with appropriate knowledge and advice only. Mentioning the stocks here does not imply that I have a trading position or likely to take a trade in these stocks.