Special circumstance investing – May update

Not a lot happened.

The UVX put is still not sold. Mainly because I just do not feel like logging into my computer when I get home after work (and my broker’s site is blocked at work). But I now am clearly in profit on this position so it will definitely go in June. Profit will be around 10% which is not bad for 4 months. Still not sure if I will do this again or not in the future for the same reasons I mentioned last month.

What did I do?

Like I said, not a lot.

The ABI put expired worthless. So the premium off 786,40 euro is now completely profit and in the pocket. I must repeat I really love my broker as he lets you trade on margin. My previous brokers insisted on having full coverage when writing puts and although I agree with this on principle it always annoyed me when I had to buy back a worthless position before being able to write new puts. just for this reason I would now always choose a broker which allows leverage. At my previous broker I would have need to buy back the ABI position at a cost of 20 euro (and a fee) before I could enter into a new position. Now I could just let the ABI put on the books until expiry thus not having to spend the 20 euro on something I knew was worthless and avoid another trading fee. It is not only that you avoid small costs but also that you gain a lot of flexibility. And having flexibility can mean big profits sometimes.

Also, it’s less work to do. Which lets me be lazy, always a big win in my book!

I am in profit on the UVXY put I bought. I am in profit on the ADM put I sold and I am in profit on the leveraged construction. Life is good.

Day trading grinded to a halt due to work. 1 May I was home due to it being an official holiday in Belgium and I made 95 USD with day trading that day. Then I started working and I only did one more day trade on 16 may. Made 20 USD, exited the trade because my head was not into it and that was it for the month. The girlfriend is going to a music festival in Portugal this week (yes I know, the decadence!) so I hope to get some day trading in on those days. Best laid plans and all of that ..

The girlfriends portfolio

Well, since I did almost nothing in my own portfolio you can guess what I did in the girlfriends portfolio: zero, zip, nothing. She should have received her dividend (around 2.000 euro) from her main position in May, still need to check that! I guess this is the best passive income you can have: just pocketing the dividend and the only thing you need to do is transfer the dividend or re-invest it.

The girlfriend got her current portfolio seven years ago. When we bought our current home together she sold her house in Ghent. She made a very nice profit on that sale but I decided we should borrow 100% of the purchase price of our new house. Part of her profit she wanted to use for renovations (with me putting up the same amount in cash for renovations) on the house but I decided she needed to invest a big part of it as well. She wanted dividends so ended up with a good stock (but not my first choice). After almost 7 years this position is now close to double the original worth (including dividends)! The downside of this was that for the next 7 years all our savings have been going to the house renovations (and we are still not finished). The alternative would have been to not do the investment and use all the money for renovations. And then start saving up to build a stash (in her case, or me to rebuild the stash). Well, after almost 7 years I can say that the profits on her stash are bigger than anything she would have been able to save! And I was a lot less active in her stash than I was in mine (so the difference for me would have been even bigger but not so easy to calculate). The only downside is that we are now still not finished renovating and that for a few years we were living on a construction side (although last year, with the kitchen and bathroom renovation, was the hardest). It just proves there is profit in being able to handle discomfort.