MY FIRST OPTIONS TRADING MISTAKE July 2021 Portfolio Updates Financial independence Retire Early

That’s right, it’s not clickbait. I did make my first options trading mistake, but thankfully it was not an expensive lesson to learn. I’m sure it won’t be my last! Watch on to see what I did wrong, and how the rest of the portfolio performed in the month of July 2021!

Hey everybody rebecca here for a portfolio update for july 2021 i’m sure that you saw the thumbnail and the title and yes it is true i have made my first options trading mistake and that didn’t take long right so i’ll tell y’all about that in this video first things first if you are new here welcome to the channel i’m on youtube showing y’all my journey to reach

Financial independence and retire early so i share these portfolio updates monthly a huge part of me reaching financial independence is investing i am new to options trading but i’m really liking it so far despite having made my first mistake but it’s all a learning process and to me the options trading is just another form of passive income so i am happy to learn

It and keep up doing it but yeah if you’re new to the channel welcome i share these updates monthly i hope that you’ll subscribe down below and follow me on this fire journey without further ado let’s jump into my m1 finance portfolio first all right here we are this is my taxable account with m1 finance and let’s take a look at how we’ve done over the previous

Month or actually down a little bit for the previous month i’m not surprised i did update my spreadsheet before i started this video so yeah i’m not surprised that we’re down a little bit here the thing that is holding down my taxable account here with m1 is my speculative growth plays the dividends are doing fine but yeah my speculative growth is the arc etfs

As well as highly on and you all can see everything is in the red right now that is okay these are long term plays i do expect that they will provide a great return over the long term it’s just that in the previous month here we’re down we’re in the red here if i had extra money then i would be throwing extra money at these accounts but my extra money right now is

Earmarked for paying off my car so yeah a little bit of a drag here in the taxable account with m1 let’s take a look at my roth ira so my roth ira here we are up over the previous month 342 dollars i should also say that i have not contributed any of my own money to either one of these accounts and all of the growth that you’re seeing is just pure growth here

And my roth ira is made up completely of vanguard etfs these do pay a quarterly dividend but they paid out in june so no earned dividends here for the month of july all right moving on here this is my options tracking spreadsheet that i got from financial options with thumper youtube channel i love this thing and definitely use it for all of my options plays i

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Do my options trading in fidelity and i won’t actually bring up my fidelity account because it shows account numbers everywhere which is really annoying when you’re a youtuber that wants to share things but yeah i keep track of all of the options plays that i do here in this spreadsheet and if y’all are just interested in how that has gone over the last month

Here y’all can see here 313 dollars and 13 cents worth of premium earned in july from all of my options trades and just briefly i’ll show you what i have on right now if you’re interested in options at all i do have a put on with tqqqq for a strike of 50 that expires december 17th and then i have some other smaller plays here with ticker symbol sndl and then

Also mind med i have had my mind med position with fidelity for forever and i am writing covered calls on my mind med position so looking at mind med first here just quickly i’ve logged in all of the purchases of mindmed that i have done and most of my mind bed purchases were done in 2020 i bought 377 shares in 2020 and i had a cost basis of 43 cents a share now

With 377 shares that means that i could write three contracts for my mind med shares because each contract is 100 shares so since i am getting more comfortable writing options contracts now i decided that i wanted to go ahead and buy 23 more shares so that i could write an even four contracts and have 400 shares of mind med and that’s what i did so the end of july

I bought 23 more shares of mind med at cents per share so this raised my cost basis in my bed a little bit but y’all can see all of the covered calls that i have been writing on my mind med position so far and then i did write a put a long time ago um yeah i have earned so much premium on my mind bed position that even though i bought these few shares at three

Dollars a share my cost basis overall for mine bed is still negative so that means that my bed could completely go to zero i could lose all of the shares that i have or that they would become completely worthless and i would still come out ahead because i’ve earned enough premium from writing all of these covered call contracts that my cost basis is negative so

Yeah this has been a really good position for me so far and honestly these covered calls that i am writing if these shares get called away from me at the strike price that i’m setting of five dollars a share i would not be upset at that at all that would be wonderful capital gains for me so if they get called away i’m not gonna be mad about it moving on into

The other position that i have this sndl guys this is a position that i am trying that is a colony strategy so my very basic understanding of how the colony strategy works is that you pick a ticker symbol that does not have a really high share price and you get into these ticker symbols at a good price you write covered calls against the shares that you have in

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Order to grow the position quickly and the return on capital supposedly with these micro cap positions is going to be a lot more than if you were doing the same strategy with a larger cap stock so i’m giving this colony strategy a try with this position i’m not sure how long i’m going to stick with it because to be honest the longer i’m hanging on to this position

The more i think about the strategy itself the more that i’m kind of deciding that i’m not really that excited about owning these shares for these micro cap stocks that i really don’t know much about at all so i think that i’m probably not going to stick with this strategy for forever um i’m giving it a try right now with this sndl ticker but yeah i don’t think

That this is something that i will keep doing over the long term or if i do keep using this strategy it’s going to remain a very small part of my overall portfolio so this is what i’ve got going on with this ticker right now i did buy 400 shares at 90 cents a share and i have a covered call against those shares that will earn me 89.25 if it goes to expiration i

Do also have a put on this position for 50 cents a share and that earned me 16.88 worth of premium there if this expires worthless if i get assigned to these shares at 50 cents then that will lower my cost basis anyway and i will then turn around and write covered calls against the six contracts that i bought at 50 cents so yeah i’m giving this colony strategy

A try but not sure how long i’m going to keep doing it and that brings me to my first mistake of options trading so how did i manage to screw up options trading already my mistake was not making sure that i had clearance to do a strategy that i wanted to do with my current level of approval that i had with my brokerage fidelity i will spare you the long details

About the back and forth that i have had with fidelity over this last month but suffice it to say that i bought a long call on another position that i was going to try this colony strategy with and the ticker symbol for that one was um idex id ex so i bought a long call on that position and i was planning on writing short covered calls against the hundred shares

That i bought this is known as the poor man’s covered call strategy and i did not have clearance to do a poor man covered call strategy through fidelity i believe fidelity refers to it as a vertical calendar spread so i bought one contract of idex long dated and i could not sell the covered calls against the shares in the short term that was my mistake now when

I realized that i did not have the appropriate level for options training and fidelity to do this poor man’s covered call strategy i did apply for the next level up but they did not approve me for level four you need level four to do poor man covered calls i am only at level three with uh options trading for fidelity so i can’t do the poor man’s covered call

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That was my mistake and i had already bought this long leap on idex and i couldn’t do the short calls against it so i decided to go ahead and just sell to close that position and i did sell it at a little bit of a loss i only lost 36 dollars from getting rid of this position so yes it was my first options mistake but thankfully it was not a big one and lesson

Learned there make sure that if you’re wanting to try a new strategy and grow with your options trading skills make sure you have clearance first before you dive into a strategy and come to find out later on that you can’t actually do the strategy that you’re wanting to do so i no longer have that idex position it cost me 36 dollars to get out of there but that

Was a lesson learned and if not for that 36 dollar mistake then my realized options income for july would have been about 350 bucks which was nice but because i lost that 36 dollars there it was uh it was only 313 or something like that so yeah that was my first options mistake i am sure that it will not be the last this is all a learning process but overall

I cannot be mad at the way options have gone so far for me all right here we are this is looking at my august budget spreadsheet i am actually filming this on august 1st so here are all of the totals for my various investing accounts that i have right now my taxable m1 finance account 2946.56 my roth ira is sitting at twenty two thousand one hundred ninety

Dollars and sixty eight cents my total amount that i have in my fidelity account is seven thousand four hundred fifty nine dollars and thirty cents and my largest account my work retirement 403 b this one is sitting at 102 440.70 so my overall portfolio is at 135 000 my goal for financial independence is 1.2 million invested and i am 11.25 of the way there and

If you all are wondering what this number out to the side is this is all of the money that has gone to investing for me for 2021 so far and this is all of my accounts combined this includes my employer match for for my 403 b as well okay everybody i hope that you enjoyed this july portfolio update review leave me a like down below if you have let me know how

Investing has gone for you for july as always i appreciate it if you made it all the way through this video and i will catch you all in my next one bye guys so you

Transcribed from video
MY FIRST OPTIONS TRADING MISTAKE • July 2021 Portfolio Updates • Financial independence Retire Early By Rebecca’s Quest to FIRE