October was a very volatile month with huge swings within days. The most classic case was on 13 October 22 when the market first crashed when CPI readings were higher than expected (which meant that inflation was still not coming down) and then rapidly rose to record the top 5 highest intra-day fluctuations in the history of the S&P 500.
Overall, it was a good month for me as I clocked the 2nd highest monthly returns since I started options trading in Feb 2021. Of course, that was with a lot of risks, a lot of luck, and predictions going right when they matter. After going through stressful periods where I could potentially lose a higher amount than the amount that I have gained, I would not want to take on such high risks in future trades again.
Here’s my profit & loss table for Oct 2022.
Starting with my LEAPS CALL Portfolio, it was a “good” month as there were no contracts expiring in the month of October. The next batch of LEAPS CALL expiring would be in Jan 2023. I bought some Tesla CALL for short-term trades but it did not work but the loss was minimal.
My overall LEAPS CALL portfolio was still down 329k (or 96%), despite cutting about 91k of losses over the last 2 months (Aug & Sept).
Next up, for my Wheel Portfolio where I was mainly selling Covered CALL, I was finally able to close some of the contracts and lock in the profits during the few sell-offs in the month of October. Previously, I was kind of stuck on these contracts as the share price kept rising above the share price when I first sold the CALL contracts.
In the month of October, I realized 10k of gains through closing my Covered CALL contracts.
Finally, the most gains came from my Vertical Spreads Portfolio, where the Bear CALL Spreads worked quite well especially when the market was crashing.
Most of my trades revolve around Tesla stock, which was more volatile than the market and experienced a bigger fluctuation when Q3 delivery numbers, AI day, and earnings were below market expectations.
TOTAL EARNINGS INCREASED BY SGD$44,222.84
The total earnings increased for a second consecutive month and were the 2nd largest gain since the 131k gain on Nov 21. There were 2 nerve-racking periods as I opened too many Bear CALL contracts on Tesla stock and it rose instead of crashed, the first being in the early October period when Tesla was still holding strong despite the whole market falling. The 2nd period occurred when there was a huge swing (crash and then surge upwards) after the October CPI results were announced. The big gains instantly became big losses. Luckily, I managed to repair the trades and avoid the heavy losses and instead made good gains.
Concluding Thoughts
Despite being a good month in terms of increased earnings, it was also a very stressful month and I spent more time staring at the screen and sleeping late at night. I don’t think this style of trading is sustainable as my health will eventually crumple under stress and fatigue. I am looking to trade with smaller positions and manage my risk better moving forward and continue to learn in this trading journey. I hope this article helps in some way, be it to encourage you to not give up or give you the hope that you can still earn some money in this bear market, even with small capital.
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After accumulating more than 600k of unrealized losses on my portfolio, I wrote this article to encourage friends and investors who are also losing a lot of money to the market.
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Happy 10 Years Of Investing | 348k (Realised) Profit, 635k (Unrealized) Loss & 10 Lessons Learnt
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Also, check out my trading strategies in different market conditions, whether it is bullish, bearish or volatile:
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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 sense of the percentage yield I get out of my gains:
1st Year Options Trading Recap: The Journey Towards SGD$217,509 Profits In 2021
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I Cut $135,715 Worth Of Losses In The Last 1.5 Months
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