When my entire portfolio was obliterated in February 25, I was left with zero shares and options contracts as all positions were liquidated by the brokerage. The only silver lining was that I was left with some cash, despite a total of USD 400k of losses being realised. Had the liquidation happened later by a few weeks, when the stock market started to have a huge correction, I would have ended up with nothing.
I Was Margin Called, IBKR Liquidated ALL My Positions & Realised S$540k (USD400k) Worth Of Losses
I used my remaining cash to start building an investment safety net by investing in the safe capital + interest-guaranteed Singapore Savings Bond. So far, my total SSB allocation is S$115k. I will add another $20k this month (May 25) to purchase SSB for June 25 and bring my total allocation to $135k.
Thereafter, I may pause on buying SSB as the bond interest is dropping. Furthermore, I would have S$135k (target S$200k) as my emergency/ contingency funds after May 25. Another reason is because the US dollar is losing its value against the Singapore dollar and I would suffer forex loss if I were to cash out spare cash (USD) from my brokerage.
Starting A New Portfolio
Therefore, I have decided to take out the amount that I need to buy SSB and my upcoming big ticket expenses (new house), and use the remaining cash of USD45k to build a new portfolio for my (long-term) investment and (short-term) trading portfolio (shares & options) for regular income generation.
I started buying into stocks when the market had a huge correction in April 25. My current capital allocation stands at 17% shares, 4% options and 79% spare cash.
I do not have a specific rule for capital allocation, but ideally, I would like to keep the capital for options trading to less than 20%, while the other 80% is made up of investment (stocks) and spare cash.
What’s Inside Each Bucket
The table below shows all the shares that I own currently. There are some unrealised gains as the market has rebounded well since April’s low.
My only option trade (2 contracts of SMH) that did not go too well at the moment. I have closed the rest for profit:
My returns since April 25 have been positive, with about 4.23% return on capital, through a series of successful trades on shares and options (I actually use a much smaller capital in April 25):
If you are keen to follow me on this journey to restart and grow my portfolio (investing & trading) from USD45k to USD100k and beyond, or you need some reference on what to buy/ trade, you can follow me (for free!) on my Patreon page.
Click here to join my Patreon Page
I usually post my trades on the same day that I execute them, so it is the fastest update that you can get regarding all the changes to my portfolio.
Concluding Thoughts
After investing since July 2012 (13 years and counting) and dabbling into options trading since Feb 2021 (4 years and counting), I have made some really good gains during the Covid market crash and subsequently through options trading. However, a few fatal mistakes that I made along the way not only wiped out my entire portfolio but also left me with a net loss of S$238.8k (USD183.6k).
I would be USD183k richer today if I had not entered the stock market 13 years ago. However, despite the huge loss in net worth, I believe I have gained valuable knowledge and experience that would be beneficial to me over the next 30 years. So, I intend to slowly rebuild and hopefully reach the break-even point one day. I have done that once after losing more than $400k in options trading in 2022, so I am confident that I would one day recover my current loss. It is only a matter of time to reach this all-important milestone.
If you have lost money in the stock market, or you have not been investing and making gains like what your peers are doing, don’t be discouraged because you are not alone. There are many others like us who have not been doing too well despite the recent bull market. As long as you are willing to learn and pick yourself up after falling down, you will one day achieve the success you have always dreamed of. I wish you all the best!
*** SEE MY TRADES & PORTFOLIO ON PATREON ***
If you are interested to find out more about my options trades and investment portfolio, I will be updating them on Patreon (on the same day I made the trades), so do follow me there (it’s free) if you need some reference or inspiration.
*** FINANCE BOOKS ***
If you are new to investing, options trading or personal finance and would like to get yourself educated about the fundamentals, you may want to consider these very popular and highly recommended books: One Up On Wall Street, The Psychology of Money, Rich Dad Poor Dad,
*** EARN FREE MONEY ***
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*** FREE BEGINNER GUIDE TO OPTIONS TRADING ***
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
*** FREE MOTIVATIONAL BOOK ***
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