2020: Week 13

Weekly Portfolio Chart

A couple things became very clear to me this week. First, I have to modify my trading strategy and style slightly due to the pandemic crisis and due to my microscopic funds. Second, for the same reasons I need to stick with trading one ticker for the time being. I bet if I let you all take a guess, those of you who have read my previous journal entries would be able to guess which ticker symbol that will be.

F. That’s right. Good old Ford. I chose Ford for five reasons. I’m familiar with it already. I have positions in it already. Ford trades with massive volume, and the options in Ford have some of the best liquidity and spreads. Finally, Ford is affordable for me to trade.

Trade Activity

Soon after I had this realization on Monday, I sold off my position in Dogecoin to free up a little capital. With the 3000 shares I bought last week, I was at a little profit, so it was easy to make the decision to get out. With the $9.47 I freed up from that, plus the few dollars in cash I had in my account, I immediately went and bought a long put option ($3.5 strike) that expired at the end of the week for $12. I may as well have just given the seller of that option my money directly. I broke my own rule for long options. That rule is this: never buy a long option with two weeks of its expiration. I wanted to jump in and out of Ford’s steady decline. Instead, Ford rallied hard with the rest of the market.

Luckily my other two long call options balanced out my risk and I came out ahead this week. When my first Ford option got back to breakeven and then a few dollars above I sold it off on Thursday for $22 in case Ford dropped again. I bought it back Friday for $17 when it looked like things were stabilizing on the news of the aid package passing in the Senate and House.

I also still have my looooong call option that expires in January. This January, $10 Strike call is my anchor position in Ford that I will trade around. It will balance the risk of future Puts I may buy, and I will add to it when the price drops to my original entry.

I’m still holding 10 shares of Ford as well. I’m considering my options with them. I would like to eventually still grow them to 100 shares, but we’ll see. A tentative plan right now is to buy another closer call option closer to the current price and exercise it when it expires in January. This would give me the months in between to grow my capital, and add to it, in order to be able to afford those shares. 

Position Brief

I’ve really paired things down and it feels good. I’m excited to see how this new, more focused strategy goes.

TickerPositionUnrealized P/L
FLong Call (Exp: 1/15 $10 Strike) +$7.00 (+70.00%)
FLong Call (Exp: 9/18 $9 Strike) +$2.00 (+11.76%)
F10 Shares -$15.54 (-23.08%)

2 thoughts on “2020: Week 13”

  1. Looks like we have very different trading styles. I’m much more of a buy and hold with a rare sell rather than dabble in options or otherwise trade frequently. This market is too volatile for my taste. I will continue to do more of the same… make monthly buys and that’s it. Thanks for sharing.

    1. Thanks for taking the time to read and comment! I agree, this market is way too volatile. My trading style in my Robinhood account is probably too risky for the current market, but I’m enjoying the learning process as I go. Also, it’s such a small account at this point that I feel the risk is minimal in the grand scheme. Still, money is money, and I am trying to learn from the choices I’ve made up to this point.

      I haven’t gotten around to writing about it yet, but in my main retirement account, my trading style is much more similar to what you describe. (I’ll be posting about my M1 Finance retirement account in the next day or two.) I buy and hold good dividend payers. Even with this downturn I haven’t sold anything. It’s been a little painful, but I know things will recover eventually, and in the meantime the dividends keep coming in! Thanks again for sharing! I love getting other perspectives.

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