I pulled out a gain in a relatively flat month. It wasn’t much, but better than the major indexes. I had realized gains on only two positions, AAPL and NFLX options and have paper losses that will hit in May, unless I accept the option assignments and write covered calls to delay the pain. That’s probably what I’ll do, aside from my XLB shares that were already assigned. I need to either write a covered call or just sell those shares and move on.
My account ended April with a Net Asset Value (NAV) of $100,863.62 according to Interactive Brokers (IB) after ending March with an NAV of $100,094.66. I had a gain of $768.96 (~0.77%) on paper for April (compared to the Dow’s 0.25%% gain and the S&P 500’s 0.22% gain) and had $1,562.05 in realized gains from my two closing trades, $1,161.35 on NFLX and $400.70 on AAPL. My GS naked put is down roughly $2,000 and still falling. It will find footing, but I don’t know when. I still like its longer-term outlook and want to stay with it and will sell an out of the money covered call sometime before the shares are assigned, unless it is assigned early.
I received $62.19 in interest ($23.71 more than last month), but no dividends in April since I wasn’t long shares of any stocks or ETFs. Quicken reported that I have an account value of $100,799.88, which the same as my IB balance after adding in the penny that was off last month and the $63.74 in interest accruals IB is crediting for me in advance of actually receiving them in a few days.
I’m only 84.62% invested in this account, 24.22 percentage points below the end of March. I opened up a lot of dry powder by not replacing my NFLX naked put, but also appear to be missing out on further gains with the options on the same stock. With days like today that have the Dow down over 300 points, I’m content to be patient and look for a better opportunity to sell my next put while not risking going on margin in a continued sell-off. If stocks fall much more, I will consider going on margin when I see a reversal starting, but only if I like the story that goes along with the reversal. I only have around $360 in time value left for my May options and $600 for my July AAPL naked put. I do have a lot of intrinsic value, really more than I like to have, in my open positions. That means that if stocks can recover in the near-term, my account will do well too, but if we continue to slide lower, I don’t have much cushion at all.
This is my asset allocation in my IB account as of the end of April:
– Large-cap ETF: 0.0%
– Mid-Cap ETFs: 0.0%
– Small-Cap ETF: 15.77%
– International: 0.0%
– Individual Stocks & Other Sector ETFs: 72.99% (pretty much large cap really with AAPL, FB, GS, and WMT included here)
– Bonds: 0.0%
– Short ETFs: 0.0%
According to Morningstar, here’s how I compare to the major indexes (including dividends) through the April’s last trading day, April 30, 2018:
– Dow Jones: YTD change -1.63%, 12-month change +18.09%
– S&P 500: YTD change -0.38%, 12-month change +13.27%
– NASDAQ Composite: YTD change +2.36%, 12-month change +16.84%
– Russell 2000: YTD change +0.78%, 12-month change +11.54%
– S&P Midcap 400: YTD change -1.03%, 12-month change +9.77%
These are my returns according to Quicken (I only made a few trades for the few months leading up to my divorce in June 2017) through the end of April 2018:
– YTD Return: +0.86% (not annualized)
– 1 Year Return: +6.50%
The VIX ended the month at 15.93 and the VXN ended at 21.06. The VIX finished March 4.04 points lower than the end of March. The VXN finished 5.62 points lower. The VIX peaked at the beginning of April, on the 2nd, when it hit an intraday high of 25.72. The VXN peaked on the same day at 31.6. Both volatility measures are off their mid-month lows and are trending higher again which might keep me towards the sidelines before I sell new naked puts again soon.