Two Years of Trading Dangerously at 84% Annualized Returns

Discussion in 'Hook Up' started by InTheMaking, Jan 14, 2018.

  1. Dear Traders,
    This is an attempt to meet fellow traders of similar or better calibre in the Texas area to collaborate and share best practices. I started trading options as a means to attain better liquidity and asset protection for my real estate business and my consulting practice. Here's a 2 year snapshot (from 12/15 to 01/18) of my account's performance against NDX, SPX and the RUT.
    VAMI Chart.png

    This was an emotional roller-coaster of ups and downs. Mostly downs with few brief periods of elation during the high watermarks. But as other traders know, we are constantly trying to play catch up to previous records. Needless to say, the focus on my consulting practice has greatly diminished during this time. Here's a dump of some metrics from IB's portfolio analyst report

    Stats.png

    Still more work to be done to refine the equity curve and drawdown periods. Strategy is a partial (70%) equity investments and partial option trading. The equity side is mostly with named stocks and couple of sectors that I understand and reasonably predict while being mindful of their fundamentals and technicals. The option trading part of the fund is primarily volatility arbitrage through option trading on the stocks and the indices; Butterflies, Straddles, Spreads, backspreads, calendars etc and watching the greeks like a hawk! The equity mirrors the indices. The daily hedged income and large spurts (and drops) come from the option trading.

    Two years ago, the account started in the high 6-figure (<800k). Now its in the low mid-7 figure (2M-4M range). I have another trader friend who has done 35% return in this market, but with much better risk control than me. His account is also similarly sized.

    Anyhoo, this email is really to encourage other fellow traders in the Texas area to PM and share best practices to find the perfect hedge. I don't have a problem sharing my hedging strategy, since I believe no two traders trades a given strategy the same way and there are several ways to make money in the process.

    Cheers!
    -m

     
    ktm, Macallik, VPhantom and 7 others like this.
  2. nice bro 84% hehe yeah living dangerously for sure. I used to live in texas
     
    777 likes this.
  3. R1234

    R1234

    Nice. I wish i had balls like that. These days i am happy with 20%.
     
    VPhantom and jys78 like this.
  4. toc

    toc

    Good Job !!

    How many trades, win/loss % and most importantly most of the returns from stocks or options?
     
  5. DeltaRisk

    DeltaRisk

    I’m in the San Antonio area mostly, Maverick74 is in Houston I believe. You won’t find better on this website or any others.
     
  6. I must be a hermit or something, but why would people want to talk to you?
    You did good, but you can do better.

    Do you qualify for Trader Tax Status and 475 mark-to-market accounting?
    This basically means you monitor and trade the market everyday from opening bell to closing bell. Doing this is your full time job for yourself.

    If you do, that's good...you can deduct all of your trading losses against your gains...you are not limited to that puny maximum yearly standard loss deduction of $3K only.
    If you qualify for that...you can basically go balls-out with your trading. Compound your gains on top of each other. Get rich or die trying kind of thing.
    If you did this with a standard trading account/tax status...you could be hit with a serious tax bill, even if you had a net loss.
     
    Last edited: Jan 14, 2018
    Overnight likes this.
  7. Overnight

    Overnight

    Spidey sense is tingling here.

    A.) This is not an e-mail you have sent. This is a bulletin board. You posted on a bulletin board (forum).

    B.) In two years, you went from $800K to $2 million or more. So what is the problem?

    You are saying you are trying to refine an equity curve that you just admitted has gone parabolic on the returns.

    $800,000 to between $2,000,000 and $4,000,000 in 2 years. How much more of a return are you looking for? What is your angle here? Why are you looking for people to help you when you have returns like this? Why not just help all us little people with your fantastic performance, by giving us tips?

    Hook-ups. Yeah. Brilliant. Best-practices my ass.
     
  8. I am averaging around 10k trades per month on around 40 underlyings. I have 7 to 8 different strategies on these 40 underlyings depending on the underlying's behavior (consolidation, pulback, bullish breakout, bearish trend). I'm spending this long weekend, to analyze my trade patterns and identify which underlying's I need to start dropping. There's definitely areas where I over-traded, which I need to get better at. The same performance could've been achieved with a much smaller number of underlyings.

    I tracked my win/loss % during the first month of my trading endeavor. But once my excel spreadsheet starting slowing down because of the various macros and calculations, I stopped tracking this.

    The 2/3rds stock part of portfolio correlated with the SPX/NDX at 30% yearly growth. The 1/3rd options portfolio grew at 220% yearly.

    Also, in the quest to become a better trader and to trade more uncorrelated assets, I started trading CL (crude) and NG (nat-gas) future options as well. Lost money on Crude and Nat-Gas has been a wash.

    Margin cushion was maintained at 18% to 25%. Now in the process of liquidation, and hopefully if we don't have a Black Tuesday, I'll be at 90% margin.

    Can't wait for that freedom!
     
  9. Jack1960

    Jack1960

    Congratulations
     
  10. vanzandt

    vanzandt

    You don't need that status to deduct 100% of your losses against gains in a given year. You can deduct all of your trading losses against your gains for that year. You sure you trade LL? I would think you'd know this.
     
    #10     Jan 14, 2018
    MoreLeverage likes this.