I sold a LEAPS PUT on Coinbase on 14th Jan 26 and closed it on 20th Jan for a loss of USD1.1k.
14th Jan 26: Sold COIN PUT expiring in Dec2028, SP USD290, Received USD10.7k
20th Jan 26: Bought COIN PUT to close the CSP contract, paid USD11.8k
Nett Loss: USD1.1k.
Why Take The Loss?
The market was reacting to the potential tariff war between US and Europe over the control of Greenland and it was a red day on 20th Jan.
However, the reason I sold was not out of fear of a market crash but rather to free up cash to buy good quality companies on my shortlist for a discount.
I had USD29k of cash reserved for my COIN CSP (Cash Secured PUT) contract, which meant that this amount could get stuck if COIN stays sideways or keeps going lower over the next 3 years. That would be a huge opportunity cost for missing out on great quality businesses at discounted prices during this period of market downturn (if it happens).
How Did I Still Be In The Green For The Day?
I was still able to be profitable because I was saved by my shares trading again. I took profits on my Micron position and realise USD1k profit.
Micron shares: 20
Average price: USD325
Sold at USD375
Profits: USD1k
Other than this, I also closed my BULL CALL Spread position on Rocketlab and made USD486 profit.
So my nett P/L:
1k to 0.486k – 1k = USD386
Concluding Thoughts
In my year 2025 trading review post, I shared that while I am up 53.68% in 2025, I made more money from trading shares (USD14.45k) than trading options (USD9.6k).
Today’s example again shows that while I made a significant loss on a failed options trade, I was saved by the profits from my shares trading. As a result, the USD1.1k loss is not that damaging to my capital and portfolio.
From this failed trade, I think it is a bad idea to sell LEAPS PUT becuase the cash may get stuck for a long time (1 to 3 years) if the share price stays sideways for a long time.
Also, there is a certain level of risk involved because during this period, the company’s finances could deteriorate (due to increased competition or poor management) and the company may go bankrupt. When that happens, it will be a huge loss because we are obligated to buy 100 shares (at the agreed strike price) according to the terms of an options contract.
Just take a look at blue chip tech giant Adobe as an example. Its share price has plummeted 33.46% over the past year due to the rise in the role of AI in designing and video editing.
If an options seller sells a CSP at strike price of USD464, he would have to buy 100 shares at this share price. Minus off the premium received, it is still a huge loss as the share price keeps dropping.
Moving forward in 2026, I want to allocate more trading capital to do shares trading than options trading. Options is a leveraged tool that can produce supervised returns when market conditions work in your favor.
However, it can also lead to significant losses if not managed well. I have lost USD1M in the bear market of 2022 and my forced liquidation episode in 2025. So, while the gains could be life changing money, the risk is very real as well.
The 6 Fatal Investing/ Trading Mistakes That Made Me Lose More Than $1M
Armed With Cash To Buy The Dip
After freeing my cash from my CSP contract and the recent housekeeping I did on 14th Jan, I now have 43% of my S$100k trading portfolio in cash, ready to buy the dip if it happens.
We all know what happened last year on Liberation Day when Nasdaq dropped 20% but quickly recovered when US President Donald Trump reversed the tariff. If the trade war escalates again this year, it could a really good buying opportunity for future gains and portfolio growth.
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