On the last trading day of 2021 (31 Dec 21), I did some spring cleaning on my LEAPS portfolio and sold off 5 Facebook LEAPS and 2 Palantir LEAPS that are expiring on 17 Jun 2022. They are too close to their expiry date for my comfort as I prefer to hold LEAPS that are at least expiring in Jan 2023 or further away.
Selling away these 7 LEAPS contracts (circled in blue above) resulted in a nett loss of SGD4,456/ USD3,301 as the Palantir LEAPS were deep ITM and prices have dropped from $26 when I bought them to the current price of $18. However, I was able to absorb this loss due to the gains I made on my portfolio this year. I had wanted to sell off these LEAPS contracts and was waiting for the Santa Claus rally to end before selling them so that I can minimise my losses. It seems with the uncertainties created by the spread of Omnicron in the US and Europe, the Santa Claus rally has come to an end.
My new LEAPS portfolio looks like this now (above) and most of my LEAPS are expiring in Jan 2023 or beyond. I also sold off a Tesla LEAPS to raise funds for a new purchase. With the capital raised from the sales of LEAPS and covered call, I was able to gather enough collateral to sell a cash-secured PUT on Nvidia.
Nvidia’s share price has gone through a correction in recent weeks but they are a force to be reckoned with, be it their dominance in making GPU and other computing chips or their role in building the metaverse with their Omniverse software. I believe in the coming years, the market cap for Nvidia will reach 1 trillion and it is good to own Nvidia’s shares for the long run. If the market turns sideways in 2022, I will have holding power by owning 100 Nvidia shares and continue to sell covered calls against them to earn monthly income, while waiting for the share price to rise further in the coming years. If the market rises in 2022, I will keep selling cash-secured PUT on Nvidia.
Keen to learn about options trading but do not wish to pay for expensive courses, this newbie guide will help gain the knowledge and fundamentals to understand options better. And it’s totally free!
The Newbie’s Guide To Options Trading
The LEAPS Strategy has helped me make more than USD120,000 in 2021. Here’s all you need to know about this strategy that can help you increase your wealth exponentially:
The Ultimate LEAPS Options Thread
Looking for ideas on what stocks to invest in or which stocks to trade? You can take reference from what I have been buying or selling. I try to update them as soon as I can in this section, as well as share my thoughts behind executing these trades:
Excited to start your trading journey or perhaps try out with a paper trading account to build your confidence in trading? Check out this step-by-step to help you get started:
How To Buy Options on Interactive Brokers (Step-By-Step)
I watched tons of videos on YouTube since 2020 and if you are wondering if there are any useful channels that you can subscribe to for learning market trends, TA, FA, check out this compilation here:
My Secret Weapons For Options Trading: I Watch These YouTube Financial Channels Every Day
I concluded my first year of options trading with more than USD160k of gain, see how I do it and the capital I use for every month to give you a sensing of the percentage yield I get out of my gains:
1st Year Options Trading Recap: The Journey Towards SGD$217,509 Profits In 2021
This blog is as authentic and as transparent as I can share, I do not just show the wins and hide the loss. I have made some very bad decisions in the first 8 years of investing and paid a huge price for them. Here is the loss I have accumulated during these years. I hope you learn some lessons from my mistakes.
I Cut $135,715 Worth Of Losses In The Last 1.5 Months
2 thoughts on “[31 Dec Trades] Spring Cleaning & Preparing For 2022”
Hi Jason. Love your posts keep them coming. I’m thinking of going into options. How do you decide between buying LEAPS vs selling cash-secured PUT?
Hi Calvin, great question. I actually did a comparison between the two, you can refer to this article.
Generally in a bull market, I will buy LEAPS but in a bearish or sideways market, I will be selling CSP or CC (do the Wheel Strategy).