By: Steve Smith
Last Friday, I provided a peek into how the Options360 Concierge Trading Service finished 2021 with a 76% gain. But, I mistakenly misspoke and omitted a couple of key data points (So… the gain was even higher).
I can no longer offer the monthly trial for $9. But regardless, I still think it’s the best investment for the price of a movie and popcorn you can make. And quite possibly, a lot more entertaining!
First off, we closed two positions on Monday, an iron condor in Roku (ROKU), and a bullish butterfly SPDR S&P 500 (SPY) for 45%; a total gain of 190%. I’m putting those positions as part of the 2021 track record.
This brings the total return to 81% for 2021 — leading me to the next 2 items:
The Options360 portfolio resets with $10,000 each year. This is an amount that I think allows access to relatively-small accounts or people who are just getting started in options trading. It’s much easier to ramp up as your account and confidence grow than to be intimidated by someone claiming that they’re managing $100,000, or a $1 million account.
To my next point; the average trade allocation was $445 (a tad below the 5% starting account size. So, when some people scoff at the fact that I only made an average of $172 per position, they must understand how this fits into risk management and position sizing relative to the account size. And hey, around 45% return per trade over the average 10-day holding period is something I can, and do, live with.
Here’s the 2021 balance by the numbers. Before I leave this behind and focus on 2022, I wanted everyone to have a grasp of my approach and how Options360 delivered high double-digit returns over the past seven years.
Winners (68) outpaced losers (32) by over two-to-one. This adds up to 100 closed positions in 2021 (about two per week). Throw in the adjustments and Options360 executed some 260 trades, meaning I sent an Alert almost daily. I think members like the pace of about two new positions per week. Also, receiving daily communications, even if it’s just a couple of sentences to update my thoughts on the market and our positions.
Average Profits per trade of $176 per trade. This was double the average loser (just $72 per trade).
The average holding period for profitable and losing positions was 10.3 days. This was somewhat surprising to me. There were about a dozen outliers where I managed winners over 60+ days as positions were rolled on a weekly basis to generate income. On the other hand, some positions got hit badly right out of the gate and just sat on the books as losers until expiration.
Breaking it down by direction and strategY indicates that Options360 really does employ an unconstrained approach. Not surprisingly, bullish positions accounted for a clear majority at 67% of the positions. Bearish positions were 16% and neutral, such as iron condors, represented 17% of the positions.
In terms of strategies, diagonal spreads (bull and bear) dominated 61% of positions, iron condors were 15%, credit spreads (bull and bear) were 16%, and a handful of vertical, butterfly, and ratio spreads rounded out the final 8% of strategies employed.
What’s not surprising is that Options360 put up similar numbers over the prior six years. Some years resulted in slightly better and some worse total results. However, I’m glad to see that I’ve kept my process pretty consistent.
Now onto 2022, where we’re already are in the green on our first trade in Nucor (NUE). Do not miss the next trade!