Can you believe it? We are already one quarter into the year of 2023!
At the point of writing, it is now 2 Apr 23 - so as usual, it is time to take stock of how much cash flow we have collected in Mar 23.
In the month of Mar'23, I collected a total of $1,859 (these are all closed trades, so its all realised profits here).
Here's a snapshot of the trades which were closed.
Reflection
I closed a total of 10 trades in the month of Mar'23. Out of the 10 trades, 9 of them were profitable.
Many people aim to learn from our failures, but the reality is that we can learn from our success as much as our failures.
What Works Well
In the past, I didn't put much emphasis on only selling close to pivotal points (i.e. support/resistance). In this month, I only took action when the stock price is close to the support when bullish and resistance when bearish.
Take PCAR for example.
Stock chart of PCAR
The green arrow represents when I sold the Bear Call Spread. As you can see, I sold it very close to the resistance (as shown by the red lines), and this increased the likelihood of the stock price reversing.
Indeed, the odds were in my favor and the price reversed, and I eventually took profit three days later (as shown in the blue arrow). This gave me a profit of $315.
Another example is XOM.
Stock Price of XOM
Over here, the green arrow represents when I opened my Bull Put Spread position, which was close to the support as shown by the green line.
A day later, the stock price bounce away from the support and eventually triggered a profit as shown in the blue arrow. This netted a profit of $324.
The idea that I trying to show you is NOT that it is easy to get short term profits. Yes, there will be days where we realised profits within just a few days. But the point that I am trying to illustrate is that it is much more worth to only open your positions at pivotal points at support and resistance - because this will increase your probability of profits.
The best part about selling options is that even if the stock moves sideways, the time decay helps to grind some profits as well.
Conclusion
I find it worthwhile to always review your trades on a monthly basis - so that I can keep discovering patterns that works well and keep doing it.
Success leave clues. Do more of what works for you and eventually that positive results compound into something larger.
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Become an option seller and discover how to extract cash flow from the stock market even if you are starting with limited capital