OptionEDGE – 3.5% in 2 weeks
On Friday May 17th, we closed one part of the OptionEDGE strategy for a profit of $900 in 2 weeks. This is a return of 3.5% on the portfolio, and a 4.5% return on Margin. We’ll be opening a new trade on Monday May 20th. Watch both Week 1 and Week 2 videos here.
To recap the trade parameters – This was a “small account” trade. Our maximum allowable margin on the trade was $25K. We split up this allowable margin into Stock A and Stock B. Stock A took up 5K in Margin, and Stock B took up 15K. We never had to increase our margin for either one of these positions, in fact, our adjustments only ended up reducing the margin. In this month’s trading cycle, the market was almost uni-directional, UP. In general, this makes capturing a profit a slower process, especially if the markets grind up slowly. Additionally, when the markets makes a steady move in one direction, the strategy requires a bit more adjustment. In this trade, we had to make 2 adjustments to Stock A and 2 adjustments to Stock B. This is a bit more than usual, but was required to adapt to the market conditions.
The complete trade parameters
– Trade entered on Monday May 5th
– 2 adjustments to Stock A
– 2 adjustments to Stock B
– Neither adjustment increased margin beyond 20K
– Trade closed on Friday, May 17th on Stock B
– Booked profit on Stock A = $175
– Booked profit on Stock B = $700
– Total profit booked = $875
– Return on portfolio in 2 weeks = 3.5%
– Return on margin of 20K = 4.5%
This is how the OptionEDGE performs. In general, you can expect at least 2 trades a month on the OptionEDGE strategy. Last month, we had 4 trades which was unusual, but we booked a 2.5% return on each of the 4 trades. When there is significant movement in the markets in both directions, we can expect to close more trades in the same cycle.
Watch for the new trade on Monday , May 20th which will be available at the end of the week. This will be Week 3 of the OptionEDGE trading cycle for the month of May.
Options Mastery Series Webinar announcement
We’re starting a Webinar series on the OptionEDGE – This will be a Free weekly webinar on Sundays at 8 pm Eastern Time, US. To register for this webinar, please visit this page and register with your name and email. You must register here for the webinar, even if you have registered on OptionTiger already. The Webinar series will start on Sunday, May 26th.