$26,502!

Including this month’s $700 deposit, we have a starting basis of $15,400 since Aug 25th, 2022 and a profit of $11,102 (72.1%) and it’s been a very good month that has taken us up $2,916 (12.3%) since our May 7th Review, despite the fact that we made NO CHANGES last month (we did add 2 new positions).  Yes, you can be cautious and still make money!  

I know this is a very boring, conservative portfolio but 12.3% in a month is not that boring, is it? Our goal is to make 10% a year and build to $1M (3/4 of which is profit and 1/4 savings) but, at this pace (40%/year), we will have $1,189,519.12 just 9 years from now!  

Since we still have $1,163,017.12 (4,388%) left to gain to get to that goal (and no, we won’t always have such amazing years), now is as good a time as any to get started. The way this portfolio works is we add $700 each month and make no margin plays – as you would have to in an IRA/401K so, if you have the time and inclination to turn $26,502 + $700/month into $1,000,000+ – now is as good a time as any to start!  

You can go over months 123456789101112, 131415161718, 19, 20 and 21 to see all the moves we’ve made to get this far. This is a small portfolio, which means we can’t use all of our favorite option techniques yet – but it’s a great way to learn how to get started on a wealth-building adventure.

As of our review on May 7th, we had $19,877 (84.2%) of upside potential in our existing trades – that’s more than we’ve made in our first two years and we’ll be adding to that, of course. We used some of our cash last month and we have $4,312 available this month – so let’s see what needs to be adjusted:  

    • GPRO – Earnings were a disaster as the company took write-offs. The subscription model started out great but flatlined – this is likely dead money but we do have 6 months. 
    • NOK – Moving up nicely since earnings and we’ll see how they do as they approach the top of the channel. If we don’t pop over, we can sell the short $4 calls for 0.60 but I think they’ll head towards $5 as they beat earnings by 22% despite missing on revenues (7%). At $4.50 we’ll be up $310 (26%) from where we are now.

Finviz Chart

    • NYCB – Still doing write-offs so earnings sucked but didn’t kill the stock so I’m comfortable with our long-term position. At $5 we’ll get back $1,000 and currently net $532 so $468 (87.9%) left to gain.  

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    • CAKE – Well ahead of our target but it’s net $2,600 out of a potential $2,500 so this looks like a good time to CASH OUT! And this was a brand new trade last month – nice!

Finviz Chart

    • F – On track for $2,500 at net $1,065 so still $1,435 (134%) left to gain.
    • LEVI – Over target at net $2,550 on the $4,000 spread so still $1,450 (56.8%) left to gain.
    • PFE – Heading back to $30 but stupidly low at 11x earnings so I’ll call this on track for $5,000 at net $1,600 so $3,400 (212%) left to gain and great for a new trade.  

Finviz Chart

    • SOFI – $7.50 has been Kryptonite for SOFI but they beat earnings by 185% in April (don’t get too excited, it was just 0.07) and I certainly think we’ll hit $10, which would be $2,500 with $1,488 (147%) left to gain.  
    • SPWR – Finally got a little move this week so I’m encouraged but still not going to count on the gains.  
    • T – Nice move after earnings on this STUPIDLY cheap stock. Still only net $2,405 on the $5,000 spread with $2,595 (107%) left to gain – still a nice trade. 

Finviz Chart

    • TROX – Over our target at net $2,050 on the $2,500 spread but that’s still $450 (21.9%) left to gain by December – so no reason to cash in early.  
    • VALE – Disappointing start for our Trade of the Year but once they finalize their settlement with Brazil, things should get going. We’re at net $1,780 on the $6,000 spread so there’s $4,220 (237%) upside potential.  

Finviz Chart

    • WBA – Have we finally found a bottom? The p/e under $12 is about 5 so very silly and we’re at net $1,545 on this $3,750 spread so there’s $2,205 (142%) upside potential and it’s tempting to double down on this one.  
    • TRVG – We just added this one and it’s even at the moment at net $777 and we get $1,250 back on October for a $473 (60.8%) gain in October but we’ll probably roll the puts and calls and keep it going if we can make that kind of money every 5 months.  

Finviz Chart

    • SQQQ – We have a hedge in our portfolio and we’re down $564 so far but that’s how we’ve been able to stay aggressive in the rally – so worth it. Still, we always need to check our hedges and, in this case, we have 10 long 2026 $10s and SQQQ is at $10 and if the Nasdaq drops 20%, SQQQ will be at $16 and the spread will $6,000 in the money and currently we’re showing net $1,940 so $4,060 worth of downside protection is starting to feel inadequate as our portfolio grows.  
    • Of course, we have to subtract this position so call the longs (not the cash) $20,250 so we’re protecting a 20% loss and the positions are self-hedging to some extent so I think we’re kind of on the cusp but we just cashed out CAKE – which means I think we’re good on the hedges for another month.  

Finviz Chart

So, once again, other than cashing out CAKE – no changes to the portfolio this month and there’s $18,494 of upside potential and we have almost $7,000 in CASH!!! after cashing in CAKE so let’s add a new trade, shall we?

Yesterday we noted HPE was too cheap into earnings and the $5 spread is only net $2.10 so nice upside for the 2026 spread so let’s make that play here with: 

Finviz Chart

    • Buy 10 HPE 2026 $15 calls for $4.85 ($4,850) 
    • Sell 10 HPE 2026 $20 calls for $2.75 ($2,750) 

That’s net $2,100 on the $5,000 spread so we have $3,900 (185%) upside potential and, like CAKE – we may be able to cash out early if earnings are good this evening. If not, we have 18 months for a nice blue-chip stock to recover and our net delta is only 0.21 or $210 per $1 change in price – a fairly low risk compared to the potential reward. 

Finviz Chart

Also let’s not let PARA go to waste.  The stock is being bought out at about $15 per share but not entirely so the options will remain but the premiums are mispriced a bit so let’s take advantage with the following:  

    • Buy 10 PARA 2026 $10 calls for $3.75 ($3,750)
    • Sell 10 PARA 2026 $12.50 calls for $2.45 ($2,450) 

That’s net $1,300 on the $2,500 spread so there’s $1,200 (92.3%) upside potential at $12.50 and the stock is at $2.80 now with a solid $15 offer on the table. When the market is giving away free money – take it! 

So we’ve spent $3,400 (half our cash) to add $5,100 of additional upside potential and you can already see how our gains can accelerate over time as the portfolio begins to grow.  Now our overall upside potential is $23,594 – almost double where we are now by Jan 2026 – a very good plan!  

 

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