April became the month when the US market started to experience a correction and even the mightiest Nvidia experienced a 10% drop in a single day and for a brief period, dropped to USD700+ range.
Concerns over sticky inflation, and tension in the Middle East, have rocked investors’ confidence as share prices started to correct.
For April, I have made a profit of S$3,463 and in this article, I wish to share with you the trades and may you find it useful as a reference to you.
The summary table of profit/ loss is as follows:
The total profits could have been more if I had not needed to cut loss on Tesla’s bearish positions after the stock had 2 significant rises after earnings and Elon Musk’s visit to China. At one stage, my SELL CALL and BUY PUT positions were quite profitable when Tesla’s share price was dropping by the day, before its fortunes reversed.
The details of all my trades can be found here:
The bigger wins of this month come from closing my Tesla Covered CALL positions that I have held for a long time (since early 2023) and my Micron CALL positions.
[1 April 24] +USD520 Profits In 6 days, Closing MU Trade Positions
[16 April 24] +USD755 Profits, Closed Tesla Covered CALL Position
[16 April 24] +USD738 Profits, Closed Tesla CC Position
If you wish to be updated on my trades as they happen, you can follow me on my Patreon page, I usually update on the same day or latest by the following day.
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I have also grouped all my profitable trades in one collection (album) so it is easier for reference.
Buying LEAPS CALL
In this month, I started buying LEAPS CALL into 2 stocks that reported good earnings but gave below expectation guidance, and they are Meta and AMD. These 2 stocks are among the strongest companies in the world and have great prospects in the AI-driven world. Their stock prices had significant drops after earnings were released. As such, I thought it was a good opportunity to buy long-term CALL options (LEAPS CALL) to give the share price ample time to recover back to its All-Time-High (ATH) prices.
[2 May 24] Bought 1 x LEAPS CALL on AMD
[25 April 24] Bought 1 x LEAPS CALL on Meta
Buying Shares
I also bought some Nvidia shares as the share price dipped to cover up for my shortfall positions in Nvidia. I currently own 124 shares with an average price of USD369.70 against the 2 CALL contracts that I sold.
Lastly, I bought 6 units of QQQ and SPY as the prices correct, with an average price of USD500.74 for SPY and USD422.72 for QQQ as the market corrects. I take this investment as a store of cash as these two index funds would return to their ATH prices sooner or later. So, it is safe to park my money there, for the short term or long term. The index funds would purge out the poor performers and add in better performers every year.
Options Trading Strategies For April 24
The strategies that I used for April 24 are the Selling Covered CALL, SOP Strategy, BULL CALL Spread Strategy, and buying OTM CALL/ PUT options, with the first being the most effective this month.
Further Read:
Why Are CALL and PUT Options Commonly Known As Covered CALL and Cash Secured PUT?
My Options Trading Strategy For 2023 | Introducing SOP Options Trading Strategy
How Does Bull CALL Spread Work? | CALL Debit Spread Explained For Newbies
Concluding Thought
The past few months have given me good returns in trading and I have cut down my total losses in options trading (since Feb 21) to around S$21k, which is good progress considering I once cut more than S$400,000 of losses in options trading.
Hopefully, by the time I reach my 4th year of options trading in 2025, I can break even and have zero losses. If that happens, it means I took 4 years to lose everything and to win back again and go back to square 1. The things that are valuable (since there were no profits) are the lessons learned and experience gained.
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