JAN'24 and FEB'24 - Reflections and Results

Reflections

An astute observation I have whenever a new year arrives is momentum tends to spike in Oct-Dec before toning back down in Jan of the next year. I would argue that one of the biggest challenges in any pursuit (career, business, personal goals etc...) is maintaining momentum.

Momentum is hard to build. It is much easier to sustain momentum than to start it from scratch. For that reason, I made it a point to tell myself that I will continue to work even during the holidays in December.

I didn't stop working out.

I didn't stop taking care of my body.

I didn't stop learning and upgrading my mind.

I didn't stop analyzing charts and trading options.

I didn't stop trying to figure out ways to invest early in alternative assets (mainly real estate...on top of my core in Options).

Even if it means working for 30min to 60min on the train ride in Japan while on vacation, I genuinely felt inner joy while working. It's all about framing your mindset. Replace "have to" with "get to" during times when you don't feel like doing things.

I GET TO exercise today. There are people with physical deformities and disease who are actually incapable of exercising.

I GET TO do work today. There are people who are genuinely trying to work and earn money who are actually out of job.

I GET TO wake up today. There are people who would do anything to live another day in their mortal lives yet most people wake up unaware that life eventually ends and sadly waste so many precious days away.

The fact that the skills I am tirelessly working on allow me the option (no pun intended) to work from anywhere in the world is truly amazing.

I can trade options anywhere in the world.

My future real estate properties will continue to generate rent even when I am not physically in the same country.

I continue to learn and hone my skills in tech such that I always have the option to work remotely anywhere in the world.

The notion that we should entirely switch off during vacation is a concept I struggled to grapple with and therefore do not ascribe to; because momentum is extremely hard to build up once halted and anyone who genuinely and truly believed in excellence would understand this and agree.

One thing I would say though, opportunities won't come knocking on your door. You need the genuine desire of wanting it. Then you'll do your homework and eventually land on the right community / people by asking the right questions / seeking the right support.

Options Trading Mistakes and Learnings

For Jan'24 and Feb'24, the single biggest mistake I made resulting in higher than expected losses was trading natural gas/oil/energy tickers $FCG, $OXY, $XOM, $RRC based off seasonality.

Specifically, the mistake I made was picking the expiration dates in Jan'24 or early Feb'24. Picking end Feb'24 or Mar'24 expiration dates would have yield a higher probability of winning.

Even though these trades made up my losing trades and pulled the overall performance down -- after reviewing why, I felt like they are good lessons.

Upon reviewing the charts again, the overall directional bias I had was largely right; for all 4 tickers, December was always at a low, and momentum and price picked up again in February/March.

Anyway, we shouldn't care too much about being right/wrong, the only question we should ask ourselves is -- Did we make profits ? If yes, good. If no, WHY?

I will attached some charts below to illustrate; I marked the Dec lows in orange, and the subsequent Feb/Mar price high in dark green.

$FCG (2 years data point)

$OXY (2 years data point)

$XOM (2 years data point)

$RRC (2 years data point)

When we approach the end of 2024, I will definitely note down this learning and re-examine/re-trade this sector again with my newfound knowledge from being perspicacious.

Additionally, for $MSFT and $DDOG Earnings trades -- $MSFT and $DDOG moved after earnings, but did not move enough for our ICs to become profitable. Normal and we cannot expect every IC during earnings to win.

Overall, we ended Jan'24 with +17% (+$400) and Feb'24 at almost flat +1% (+$35) for 1 contract traded.

Not over scaling my number of contracts and doing proper risk management really helped here. I know I say this a repeatedly... Jan'24 and Feb'24 just goes to show how crucial it is.

Imagine doubling your contract size on all the oil/energy tickers without having a doubled capital; it magnifies our losses.

Feb'24 was a HUGE month for Crypto / Bitcoin. Since I did not trade crypto directly, I traded $COIN by proxy. I traded a 160/170 bull call spread but exited early at only a ~$100 profit when $COIN sold off from $190 back to $160+ to book partial profits (see green box highlighted below).

$COIN went on to gap up and today trades at $250+.

It took me 3 days to get over it.

Results