First I am mad at myself for not doing my net worth statement, but since no one cares but I should probably let it go. But, I am extremely excited today! So much so that I am writing up a post in the middle of the day.
In the middle of last year I got caught in some really, really, really (did I say really) bad trades. Specifically I ended up getting called on 7 contracts of Dollar General and 4 contracts of Dollar Tree.
With that type of quick drop it is impossible for me to keep rolling. So I ended up adopting the wheel strategy. When this happens normally I am out of the position in a few weeks, selling covered calls (and collecting dividends if available) until the revenue received lowers my price and the stock is called from me. However, with this ridiculous drop along with this many contracts I was a shit ton in the hole. I wasn’t worried, it didn’t keep me up at night, because I still owned a massive company that serves a ton of Americans. It is the reason that I only sell naked puts with Mid to Large Cap stocks based on real revenue and profits b/c at the end of the day I don’t believe they are going to $0.
Either way that is all done today. The last 4 of the 7 contracts are likely going to get called away from me in the morning. I say “likely” because I have a few rolling orders in, but it probably isn’t happening. This will finally bring my margin back to $0, or really a few bucks in cash.
Going Forward
That means I am free to move forward with whatever plan I want at this point! I have been giving this a lot of thought lately even writing about it,
20% of any weekly proceeds are going to be ignored. This will go against the debt associated with those positions that have been put to me. As soon as I am rolled out of all the positions that are providing a margin debt then I will reallocate this 20% probably to cash, money market or ETF.
80% of any weekly proceeds will be paid to Tier 1 debt.
I think I am going to keep the spirit of those thoughts a month ago, but twist it up a bit going forward:
- 70% will be going to retire debt
- 15% Pure Cash
- 15% ETF Purchases
I am excited to get this part of my life back up and running! I will check in next quarter to give an update!