Q&A: How My IBKR Portfolio Capital Increased From 17K To 938K In 15 Months

After my previous post sharing my 576k unrealised loss, some friends asked how I have managed to increase my portfolio capital from 17k at the end of Feb 2021 to 938k at the end of May 2022, which is 55 times increase in size during this period.

So, I thought it would be useful to share how I build up the capital in this account so that you can use it as a reference and make your own investment decisions. By the way, this is not flaunting and there is nothing to flaunt as I am already down by more than 50% in unrealised loss.

The 5 Components That Built Up The Portfolio

There are a total of 5 components/ sources of capital that make up the 938k portfolio and I will share more info below on how much capital is generated from each source.

Component 1: Capital Recouped From Failed Investments

I started my IBKR portfolio with the purpose of doing options trading. My first options contract was to sell a PUT option on Apple at a strike price of USD126, which explains the initial capital of SGD17,000. However, I started investing way earlier in 2012, building a portfolio comprising mostly SG stocks, to earn dividends and fight inflation.

Over the course of 8 years, from 2012 to 2021, I clocked up a 6-figure (paper) loss when many stocks in the portfolio kept declining over the years. I finally realised all these losses (135k worth) in 2021 but in the process, free up $104k of capital for my IBKR portfolio.

Read more about all the failed investments that I have made in this article:
I Cut $135,715 Worth Of Losses In The Last 1.5 Months

Component 2: Capital & Profits From Successful Investments

One of the best investing decisions that I have made when the market crashed during the 2020 pandemic was to pick up SG bank shares (DBS, UOB and OCBC) when they dropped to a very bargain level. The profits and dividends earned when I sold them all were $87k, which was a 44% return over a period of close to 2 years. Together with the invested capital of $196k, I free up $283k worth of capital for my IBKR account.

Read why I sold all my bank shares in this article:
I Sold All Of My Bank Shares | The Final Step Towards Financial Freedom

Component 3: Cashing Out Singapore Savings Bonds

I purchased the Singapore Saving Bonds back in 2018 to diversify my portfolio and to act as an emergency fund just in case I need cash. The capital and interest (average 2.6% per year over 10 years) are guaranteed and will not fluctuate in different market conditions. However, I was not satisfied with the 2+% annual returns and sold all my SSB worth $60k.

Read why buying SSG is better than putting your savings in banks:
The Safest Investment That Can Beat Your Bank Returns By 30 Times

Component 4: Profits From Options Trading (2021 to 2022)

The reason why I have the courage to realise my loss and reallocate all my funding to my IBKR portfolio is that 2021 has been an extremely profitable year for me in terms of options trading.

You can read how I generate more than 200k in year 2021 in this article:
1st Year Options Trading Recap: The Journey Towards SGD$217,509 Profits In 2021

I use the powerful strategy LEAPS Strategy to magnify my gains in a bullish year in 2021 but this option strategy fails miserably in 2022 where the market has been trading sideways or going down for most of this year.

Despite the LEAPS strategy working against me and building up my paper (unrealised) loss in 2022, I was still able to generate a fairly good return using the Wheel Strategy in 2022. Based on the latest total of 309k generated at the end of May 2022, it means I have earned close to 100k in the crappy year 2022. This was made possible with a larger capital base to work with and using the strategies that work in a sideways/ bearish market.

Component 5: Emptying My Vickers US Stock Portfolio + Savings Salary

I started venturing into the US market in early 2021 and bought a basket of US stocks (Tesla, Microsoft, Apple, Amazon and Alibaba) using my DBS Vickers account, which I think is a big mistake because the commission fees are extremely high and the shares when accumulated cannot be used to do options trading. I then sold away the whole US stock portfolio in my Vickers account and free up $65k worth of capital.

I also have a REIT portfolio which consist of Prime US REIT, Ascendas REIT and Keppel REIT, which I later sold them all to generate an additional $20k worth of capital.

Finally, the above components adds up to $841k worth of capital and I made up for the rest through the dividends, some random shares that I bought and then sold with minimal profits/ loss, as well as topping up the rest with savings that I accumulate through my salary and bonuses from 2021 to 2022.

Concluding Thoughts

The biggest motivation for emptying my SG stock portfolio and then build up a huge base in my IBKR portfolio is to achieve my dream of creating a sideline stream of monthly income that can replace the salary from my day job. This will help me achieve financial freedom as I do not need to rely on the salary from my day job for survival. I can continue to work and build up my capital base or I can choose to do something that I like and find meaning in while living on the income generated from this portfolio.

It is worth noting that I took a few months of intensive learning on YouTube to understand the basics of options trading before I execute my first trade. With more than a year of experience, I still consider myself a newbie. My risk appetite and tolerance are different from any one of you so please do your due diligence and use your own judgement to invest.

I hope this sharing has been useful, especially you are working towards Financial Freedom and Early Retirement. It is not an easy process but it is doable if we learn financial literacy that can empower and change our own lives. I wish you all the best in your investing journey. May the market be in your favour.

*** FREE RESOURCES ***
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 on executing these trades:
MY TRADES

If the bear market in 2022 is making feel depressed as your stocks come tumbling down, read this article to find out how you can use options trading to help you claw back some of your losses as you await market recovery:
How I Do Earn Even When The Stock Market Is Bearish?

Also, check out my trading strategies in different market conditions, whether it is bullish, bearish or volatile:
How Not To Lose Money In Trading? | My Trading Strategies For Bullish, Bearish And Volatile Market

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

Want to learn more about Technical Analysis (TA) but find it difficult to grasp the concepts? This article brings you TA at a glance, and helps you understand key terminologies, indicators, and techniques used in TA to equip you with the knowledge that can empower you in your investing/ trading journey.
The Newbie Guide To Technical Analysis (TA)

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)

Follow me on your favorite social media platforms, Facebook, LinkedIn, or Twitter, to get notified of my latest blog posts. Or join our investing/ trading community at Telegram to exchange ideas or ask questions relating to investing/ trading.