Weekly: one step back, two steps forward

Monday was a holiday. Tuesday I lost about 2.0%. The rest of the week I more than made that up and gained over 1% for the week.

I went to my local meetup. The main guy is fairly bearish, in a “show me” state.

I recently took new long positions in XLNX KL IBM. Added to longs in GE. In QQQ and SPY, I try to rebalance back to close to delta neutral, slightly long, by the end of each day.

Monthly: Monster truck rally grade A-

Stock markets start the year with a monster rally. My account is up 8%. Here are a few etfs for 2019:

IWM +10.0% Russell 2000 US small cap
QQQ + 7.1% Nasdaq 100 US mostly tech
SPY + 6.6% S&P 500 US large cap

EEM + 6.4% Emerging market equities
GLD - 0.2% gold

SLV - 1.0% silver
TLT - 1.6% US 20 year treasuries

So equities had a very good month, and some other asset classes declined a bit.

A couple of big changes that I made were to adjust back to near delta neutral on most days. Sometimes I had to make multiple adjustments. I stopped counting winners and losers. I used to really want to book winners, which is human nature. Now, I am more likely to find the quickest way back to near delta neutral and if that means taking losses so be it.

Who knows which way the market goes next? I sure don’t. I am taking some risk, but overall a bit more cautious than I was, say in September 2018. Stay tuned.

Another plus week

I am up nearly 3% for the week. The tumble in Tesla on Friday, prevented an even better outcome. I keep rebalancing to near delta neutral on my primary positions. This meant taking some losses on sold calls on more than a few stocks including AAPL BA NFLX QQQ SPY. The Netflix earnings report came in with a whimper, but I didn’t play it. Tesla has given so many head fakes lately, that I was reluctant to reduce delta on the news. By the end of the day, I rebalance back to delta neutral, but losses for the day were large. I’ll post a monthly recap with harder numbers in a day or two.

Wins and losses no longer the emphasis

On Monday, the market runs too hot. I close several sold calls for losses. The straight up rally can be just as bad for strangle sellers, as a sharp decline. Netflix, Amazon, Apple, are the main culprits, but there are others. The good news is that I finish the week up over 2%, about the same as the increase in SPY.

I’ve shifted my focus to staying near delta neutral. I’m selling options closing in with higher deltas when necessary. I got an email saying my account was flagged because a 20% down move in the market would be very, very bad for me. Selling a lot of 10% probability puts, as was my preference would create huge downside risk.

My overall stance is a shift is away from counting wins and losses. Win percentage is only one metric, and while it can be useful, the emphasis is shifted towards net liquidating value, and risk.

Earnings season will soon be upon us. Netflix showed that big moves can happen outside of earnings. As always be careful out there.

Apple bites the dust, also GE and XON

The year started off okay, then AAPL lowers guidance and the market goes lower. The next day some good economic news and comments from the Federal Reserve chair, ignites a huge rally. I continue to roll up and down. I was mildly long Apple coming into the news. I continued to adjust the position back toward delta neutral. This meant the Friday rally had me scrambling to add long delta. For the week I was up around 2%. I’ll take that.

I take small long positions in GE and XON (the biotech not the oil company) based on some conversations. These are tiny positions. Tesla tumbles on news, then recovers some.