Options Trading Income Report – October 2016

october_2016

65.40
Total October Income
1104.66
Total 2016 Net Income

Just keep swimming…

My trading this month reminds me of Dory from Finding Nemo…just keep swimming. October wasn’t a particularly exciting month, but a few trades happened, they went in the right direction and my overall profit for the year went up.

No complaints here!

Option Trades

On the option trading side of the house, I gave a swing at a debit call spread on PBR. It’s a first for me and the chart was too tempting. Not the best way to trade, but the trend was definitely my friend on this one. Take a look at the chart below and you’ll see what I mean.

PBR Debit Call Spread Trade

PBR Debit Call Spread Trade

I bought the $10 call and sold the $13 which created a $3-wide spread. This meant my max profit on this trade was $300 minus the cost of the trade and commissions. Of course the stock stayed flat for a bit, but was kind of enough to continue its upward trend around the beginning of October.

I maintained a 50% profit target on this trade which is why I close it out mid-trend. I could’ve held onto it, but overall I’m happy with capturing a small profit than hoping for a larger one.

My other trades were pretty routine. A couple of covered calls on CLF to lower my cost basis a little and a single put sold against CHK. CLF is currently in the midst of the “Wheel of Fortune”, so i’m just selling calls against it until it gets called away.

Dividend Income

The loss of STR in my dividend portfolio was offset with the addition of FLO. It’s not a blazing hot stock or anything, but meets my metrics for stock selection for dividend growth, so we’ll see how it does!

On a side note, HCP spun off one of the divisions of its company to create QCP. I was “awarded” two shares of QCP for every five shares of HCP I owned at the time at no cost to me. There’s not a dividend associated with this stock, but since it cost me nothing I’ll hold onto it to see what happens.

Lending Club Income

I added another $100 to my Lending Club account this month from “winnings” from my options trades. This equals another four notes added to my account, which brings the total to eight.

Overall, i’m pretty satisfied with Lending Club and the monthly returns. As I continue to win more from my options trading, you can bet I’ll continue to add to my Lending Club account to continue to grow this stream of income and diversify my types of income overall.

At some point in the future, after Christmas and a discussion with the wife, I may put a significant amount into Lending Club to boost the rate at which that account grows. Around $1,500 or so it gets to the point where you can add a new loan to your account each month and quickly grow your income stream.

Stay tuned for that!

That wraps up this month’s income report. I hope your trading is going well this year and you’re learning something new about options trading!

I’d love to hear from y’all, so drop me an email at nakedoptiontrader@gmail.com, leave a comment on the site or catch me on Twitter @optionstudent.

Until next month!

Happy Trading,

Patrick

 

October Option Trading Income: $59.65

October Dividend Income: $1.87

October Lending Club Income: $3.88

Total October Income:  $65.40

Total 2016 Net Income:  $1,104.66

 

Current Stock/ETFs Holdings

Symbol # Shares Quarterly/Monthly Dividend Per Share Annual Dividend Per Share Cost Basis Yield Pay Month
ADM 10.069 $.30 $1.20 $37.10 3.23% C
HCP 10.145 $.575 $2.30 $27.28 8.43% B
JNK 10.103 $.183 $2.20 $33.95 6.68% M
VLO 10.087 $.60 $2.40 $52.47 4.59% C
FLO 10 $.16 $.64 $15.11 4.23% C
QCP 2 $0 $0 $16.25 0 N/A

A = (Jan/Apr/Jul/Oct)  B = (Feb/May/Aug/Nov)  C = (Mar/Jun/Sep/Dec)  M = Monthly

October Dividend Payments

Stock/ETF Total Dividend Paid
JNK $1.87

October’s Option Trades

Strategy Stock/ETF Option Entry Price Exit Price Commission Net Profit % Gain/Loss # Lots
SP PBR Oct 16 $10/ $13 Call $.45 $.69 -$6.14 $17.86 53.33% 1
CC CLF Oct 16 $7 Call $.09 $.03 -$3.07 $2.93 66.67% 1
P CHK Nov 16 $6 Put $.57 $.25 -$3.07 $28.93 56.14% 1
CC CLF Nov 16 $7 Call $.19 $.06 -$3.07 $9.93 68.42% 1

CC = Covered Call  P = Sold Put  SP = Spread  -Rx = Roll #X from previous trade

Join the discussion 2 Comments

  • Steve Tahan says:

    So, have you figured out your hourly income for your effort?

    • Patrick says:

      Steve, my gut tells me I’ve reduced my overall time spent, but unfortunately I don’t track my time as a metric. I’d say I spend at most 30-45 min a week checking the status of trades or putting on new ones.

      I’ve reduced a lot of the time required by putting in GTC trades at my profit target when I open a new trade. This really allows me to not worry to much about catching the trade to close it. If the trade is moving against me, and I want to roll it out, it’s just a few clicks to make that happen.

      Picking trades is fairly easy too. My watchlist is pretty specific, so I just glance over it, find a trade I want and put it on. If I don’t see something I like, I just wait a day or two and things change.

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