New Trade Alert Below Profit Summary and Track Record
SPY went from $299.73 to $299.56 for -$0.17
Collar went from +$0.19 to +$0.01 for =$0.20
Net Profit = +$0.03/Share on 1700 shares
A small profit on 1700 shares of SPY today but nearly a ~$1.80/share gain on 3700 TLT shares sending our return in October from -0.7% on Monday up to -0.2% today for a net gain of $7,124 so far this week!
Will we break into a profit for October by Friday?
Key Macro: Trade talks remain positive, Fed continues to loan banks 50-80B overnight from “Repo Madness”, ECB is buying $20B/month is government bonds, FED is purchasing 60B/month in short-end treasuries, rate cut highly probable at the end of the month, expected one-time injection of 300-500B by fed in November & SP500 companies are having decent earnings.
Here is our current asset allocation recommendation:
The charts below illustrate the profit per month we’ve generated against the SP500 and what you’ll notice is that we rarely have a losing period no matter which direction stocks are headed.
We do well when the market travels higher but when stocks selloff, especially rapidly, we generate substantially better returns as seen in the 2.2% return in May when the SP500 sold off -5%.
The only time periods we’ve really struggled has been during high intensity trade talks that had they failed would have sent the markets into a tailspin, we’ve always played it on the safe side.
New Trade Instructions
New Trade: Per 100 shares of SPY
(1) Buy to close Oct 23, 2019 $301 SPY Call, sell to close Oct 23, 2019 $297 SPY Put
(2) Sell to open Oct 25, 2019 $302 SPY Call, Buy to open Oct 25, 2019 $297 SPY Put.
Step 1. Close our previous trade if you took it otherwise skip to step 2.
Step 2. For every 100 shares of the SPY you own enter one of the following option contracts.
This is the maximum P/L we can achieve.