That is up a whopping $66,833 in our paired portfolios, thanks to yesterday's market surge and that's even including this week's STP losses, since we did that review on Tuesday, and have dropped about $25,000 since. That means the gains in the LTP were stunning – and we only made 2 adjustments last month! Best of all, we are swimming in CASH!!! We have $1,778,583 (83.5%) of it - up thanks to a lot of new puts that were sold in the past month, while the market was lower.
And that's our cycle – we buy low and then we sell high and we sold back in August – cutting about half of our positions and leaving us with cash to go shopping with and, what is the first thing we do when we add new positions? We sell puts. That puts even more cash into our portfolio and THEN, if we like the test drive, we establish an initial position by scaling in with a long spread (hedged, of course).
I know it seems like a slow, tedious process but it protects our positions so we can ride out the dips and you can see the results as we started with a combined $600,000 in the LTP/STP back on October 1st of 2019 (arguably a bad time to start – just ahead of an epic crash) and now we're up $1,634,532 (272%).
Since mid August, we added short puts on AAPL, AAWW, COIN, FDX, LEVI, MRNA, MT, VALE and XRX, putting an additional $86,600 into the portfolio in exchange for simply promising to buy those value stocks if they get significantly cheaper (net $98 for AAPL, net $175 for MRNA) – those would become our base entry if we do get an entry and THEN we lower the basis further by selling more puts and calls (assuming we still like the stock).
This is a simple strategy to follow but it requires PATIENCE for the long-term investor as it takes several quarters just to establish a position – BUT IT'S WORTH IT!!!