Machetephil's Trading Journal

[Machetephil]

I am going to try to update this as often as I can. Work can be crazy busy at times, so if you want an update on anything and I’m not updating it, please post a reply or send me a message.

Here is where I’m sitting as of February 25, 2022:

Balance: $42,731.70
YTD P/L: $501.15 (+1.17%) (yeah that’s right. I’m a one-percenter baby!)

Some great trades from last week:
-SPY: bought 2/25 428p and 430p on 2/22 and sold on 2/23 for a gain of $11,269.96 or 193%
-UVXY: as SPY started to trend downward this went up quite a bit. Managed to grab some 2/25 15c on 2/22 and sold them on 2/23 for a gain of $167.78
-RBLX: sold some 2/25 53c to further lower my cost basis

Some terrible trades from last week:
-SPY (lol): bought 2/28 410p on 2/24 when SPY gapped down. As it kept going up I made the mistake of averaging down over and over and over again instead of just cutting my losses. This resulted in unloading these puts at market open on 2/25 for a loss of approximately $20,300. (yikes!)

Lessons I learned last week:

(1) you have to accept the reality of what you are actually seeing in the market (SPY was showing clear signs of a reversal upward as called out by @rexxxar and others and I refused to believe it because I was too focused on macro market conditions; (2) play options with longer expirys if you can afford it (they are more expensive, but they give you a huge opportunity to average down to get out green if you are wrong); and (3) averaging down is not always the answer, sometimes the answer is to cut and move on (this was my biggest mistake last week, I kept averaging down my SPY puts to where I was holding way more than I ever had any business of holding).

This week I’m looking to unload my OZON, BNO, UNG, SPY and UVXY close to market open on Monday and then re-assess. I want to be more cognizant of what the market is doing and not what I think the market will do. I hope this is a good enough start and I hope to provide these updates more often.

[Machetephil]

I got a couple of questions that I thought I should answer here: I acquired most of by RBLX when it was around $55-$60 and I’ve been selling covered calls to continue to reduce my cost basis. Since they have weeklies it’s pretty easy money. On SOFI I have calls, not shares, so won’t be selling CC, but will be looking to trim a large amount of my position before earnings and hold a few through earnings.

[Machetephil]

Sold SPY puts, RSX puts, BNO calls, and UVXY calls this morning. Gain of $6,870. Sitting and waiting for OZON to unhalt and to watch movement of financial services stocks now.

[Machetephil]

Bought some COST calls and averaged down on the SPY drop. Currently holding 4 of the 3/18 515c for $15.22 cost basis.

Bought 1 LMT 3/18 390p as a pure lotto play off the ex-dividend date drop. Cost was $1.95.

Biggest additional move today is buying a couple of MSTR calls largely after listening to @Jekyll_and_Hyde discuss BTC and impact of Russia sanctions on BTC and potential for a bit of a squeeze. Those calls are super expensive, so I went with 3/18 440c at $35.58 cost basis. Currently down but looking for BTC to run and will cut if that doesn’t happen this week.

[Machetephil]

Sold my COST calls right before close at $18.00 for an 18.2% profit.

Still holding my LMT put and my MSTR calls. I also bought another 10 of the 3/18 12p on RSX.

Averaged down on my AFRM puts to $5.19 cost basis.

Bought back into BNO calls after some reports from this afternoon made me bullish on oil prices. 5 x 3/18 26c at $1.95.

My biggest gains for the day were definitely SPY puts, BNO calls, CCL calls, COST calls, and UVXY calls. No realized losses on anything today as I decided to continue to hold SOFI calls, PYPL puts, and LAC calls.
Keeping any eye on futures and looking to probably sell BNO calls at open. I’ll also be looking for all the information I can gather on what is going to happen to my OZON and RSX puts. I hope everyone had a good trading day!

Total as of 2-18-22: $51,787.90
Day P/L: $9,056.20 (21.19%)
YTD P/L: $9,557.35 (22.36%)

[Machetephil]

One of the things I definitely messed up on prior to starting this journal is my terrible entry on SOFI calls. As you can see in the original chart, I have 30 (!!) call options on SOFI 12.5 at $1.3267 per contract. Just stupid to go out of the money like that, even if I do like the stock medium to long-term. The only thing that will save me at this point is either a SPY rally, an earnings beat/positive guidance, or both. Looking at Options Calculator, I need SOFI to hit $12.80 this week to get out with profit. Most likely outcome is that I trim some of my losses heading into earnings and pray. If I’m going to talk about my gains, I at least owe you a discussion of my losses too.

Hoping this post ages terribly and SOFI goes to the moon after earnings, but regardless, the process of what led me to this position and holding this position this close to earning was dumb. The lesson for me, regardless of whether I make it out green or red, is that I can never get too deep into a position on anything that is OTM and that I should be ruthless about cutting losses when a trend reverses. I did that with SPY today. I’m hoping I learn this lesson and take it to heart moving forward.

[Machetephil]

Mid-morning update:

Sold my MSTR calls right at open off that nice BTC run. Sold BNO and UNG calls the minute they broke even. Bought 4 of the Jan 2023 20c on CCL. Just looking at stuff right now. Did not sell my SOFI calls at open as they were still quite red.

[Machetephil]

Quick update (will add more details later tonight):

Total as of 3-1-22: $55,559.40
Day P/L: $3,771.50 (7.28%)
YTD P/L: $13,328.85 (31.56%)

[Machetephil]

Sold my BNO and UNG calls right as they turned green for minimal profit. BNO kept moving throughout the day and I probably should have held, but I was nervous about holding as I had already been holding a couple of days and didn’t see significant movement.

Selling my MSTR calls at open turned out to be a bad decision as BTC held up well today and MSTR reached $473 before going back down to $464.73 at close. Still, profit is profit and I sold them for $46.50 and a 30.6% profit. This was my biggest gain of the day at $2,177.94.

I sold my PYPL puts when it dropped below $107 and made about $405 on them. I also scalped some SPY puts this morning and some calls this afternoon for a grand total of $286. Probably wasn’t worth it and I’m going to try to avoid doing this in the future unless I have a real reason to do so. This one $286 gain doesn’t even put a dent in what I lost last week on SPY. I think SPY and me need to take a break.

I bought 20 of the 3/18 RSX 9p at $1.84 cost basis. I think this is going to go down further once its largest holdings start trading again and gap down.

HGEN had a nice pop today on news that it was getting more funding (go see HGEN thread for more info), so I’m still holding my HGEN shares. I averaged down on my AMD shares and held onto my LAC calls and LMT puts.

The big mistake, as stated above, was SOFI. It needed to hit $12.80 today for me to get out green and it of course did not. They may have a great day tomorrow after earning or SPY may kill SOFI’s momentum, but even if I get out green, it’s because I got lucky and not because I made the right choice. We’ll see if this one works out, but I hope this is a lesson learned for me.

Total as of 3-1-22: $55,559.40
Day P/L: $3,771.50 (7.28%)
YTD P/L: $13,328.85 (31.56%)

[Machetephil]

Busy day and evening so can’t give a more robust update. Hope to do that tomorrow or Friday.

Total as of 3-2-22: $56,224.29
Day P/L: $664.89 (1.19%)
YTD P/L: $13,993.74 (33.13%)

Didn’t have the greatest day but I’m excited about the positions I took today and think I have things set up for more profit in the days ahead.

[Machetephil]

Bought 200 3/11 RSX 5p at $1.24 each for total investment of $25,000.00.

[Machetephil]

Crazy couple of days at work. So, yeah, let’s talk about trading now.

Here are my current positions (excluding RSX, more on that below). Let’s talk about them.

(Potential) Bangers:

UVXY - This is one where I initially took a small position of 5 options and kept averaging down as I saw SPY weaken throughout the day. I eventually got my cost basis to $2.30, which means I’m profitable as long as UVXY is above about $18.40 tomorrow. As of right now, it is at $20.40 so I’m hoping for a good exit on this one tomorrow morning if SPY continues to go down.

OZON - stop suspending trading and die you Russian pile of crap. As you will see below in the RSX discussion, OZON admitted in a press release today (as positive news by the way), that they have lost more than $550 million in the last 2 months because the value of the Ruble has plummeted. This one is going to be fun. I just have to remember to pay attention to it again when the suspension ends.

BNO, CORN, UCO - Commodities. They fluctuate when sanctions drastically increase or decrease supply. I made sure to buy 3/18 calls to give myself plenty of time to exit when the time is right for each one. I felt like my entries could have been better here, but I’m going to use this as a learning opportunity to potentially have mediocre entries but A-plus exits.

Mistakes:

CCJ, CCL - I held 4 CCL options and averaged down once today. I tried to average down again and accidentally bought CCJ. This was just a dumb mistake. It was me moving too quickly, typing in a ticker, and slamming the bid before I realized what I had done. The lesson here is don’t be dumb. Hey, I’m still learning too.

SOFI - I fucked this up. Badly. I should have set up limit sell orders for market open after earnings. But I was sure I was going to be sitting at my computer at market open and would be able to sell at open. Then I fell asleep and missed it. Just add this to the litany of mistakes that has led to the dumpster fire that is my SOFI play. The only good news from this is that I’ve learned about 5 lessons with this one and I just have to hope they stick. If they do, that alone is worth the money I’m inevitably going to lose on SOFI.

RSX:

So yeah, RSX. I have 30 of the 3/18 7p in my ToS account. I love ToS. As good as ToS is, TD Ameritrade’s app is complete garbage. Robin Hood may actually be better. Since, I had no time to do anything today except work, I took a substantial portion of my cash position in my WeBull account and made the following purchase:

200 contracts are a lot of contracts. $25,000 is a lot of money. Three things: (1) I purchased these options with cash, not margin. Do not trade on margin. It will end up hurting you. The entire goal of margin trading to give you more leverage than you have any right to have. That goes entirely against the philosophy of reasonable entries and exits, no YOLOs, etc. that make this community great. (2) I will not be hurt in any meaningful way if the $25,000 evaporates into thin air. I will be sad, angry, get ESSC PTSD, etc., but I will be just fine financially. No vehicles will be sold to cover this play if it goes belly up. (3) I believe in this play. Let me explain:

I’ve read all the SEC filings I can on RSX. I’m reading the news just like all of you. Russia’s economy is going to collapse (at least temporarily) as a result of the sanctions being put on Russia by countries throughout the world. We are just now at the very early stages of this. MOEX is not trading this week. Not even trading. Won’t open up until 3/5 at the earliest. OZON, one of the largest holdings of RSX, is suspended from trading. Its 10-day suspension goes away after Monday. In a press release today, OZON said it is financially secure and a strong and stable company. But it also admitted 90% of its business is in Russia. And that it has lost more than $550 million in the last two days because the value of the Ruble plummeted. OZON will gap down significantly when it is no longer suspended. This is just one example.

According to ToS, RSX.IV, which is the chart showing the NAV floor of RSX, is currently at $1.29. RSX closed today at $5.79. I think that floor is optimistic. But let’s say VanEck is right and that NAV is currently $1.29. The delta between the stock price and NAV is $4.50. Said another way, the NAV is 77.72% less than the stock price. So I think the most likely scenario is that RSX will wind down and liquidate. I personally think the announcement yesterday that RSX would no longer issue new creation shares to APs was step 1 of this process.

But even if I didn’t believe that, and just believed that RSX would drop to NAV, that still leaves a delta of $3.71 between the strike price of my puts and NAV. Most ETFs trade within a percent or two of NAV. Look at the average difference between a PIMCO ETFs NAV and its market price and it is usually within 0.20%. But let’s stay crazy conservative. Even if I think RSX will only drop to 10% above NAV, that still leaves a delta of $3.58 between my strike price and a NAV+10% floor. I bought my puts at an average of $1.24. Even if RSX only drops to 10% above NAV, I can exercise my puts and essentially 3x my money. This is one I’m really excited about and my confidence level is quite high. But a lot can happen in times of war, crisis and economic turmoil. Which is why you never invest what you cannot afford to lose.

Cheers and let’s have a great day Friday!

[Machetephil]

Oh and here’s a screenshot of my entire Webull account, which is basically RSX plus my island of misfit toys (aka plays that didn’t work out).

[Machetephil]

Sold my 45 UVXY 3/18 19c’s when SPY just broke below $430. Profit of $4,330.35 (43% banger!).

[Machetephil]

Total as of 3-7-22: $63,509.85 (not including my 200 RSX puts on Webull)
Day P/L: $3,869.72 (6.48%)
Total P/L: $21,279.30 (50.38%)

[Machetephil]

Here is some discussion about my positions, rationale, goals with them, etc.:

Bangers:

WEAT - Massive shoutout to the many folks in the Ukraine/Russia thread for the brilliant callout on WEAT the past couple of weeks. I bought my call options last week and unloaded when I hit 36% profit, which was just too good to ignore. Turns out I could have held for longer but, who cares? Take. Profit.

SPY - I feel like I’m getting a little bit better at trading on technicals. I was in VC earlier today when SPY was at 421.50 and thought I was seeing a H&S on the 1-minute and asked. A couple of other folks confirmed I was looking at it correctly and I bought a few puts as soon as it was confirmed. It wasn’t much, but was a nice $420.00 profit scalp off of correctly recognizing and acting on technical analysis. This might be the proudest I’ve been about making $420.

(Potential) Bangers:

BBBY - Everyone knows why the stock ran today. Ryan Cohen’s in. Hedgies r fucked. Blah blah blah. But in reality this is a heavily shorted stock that got a nice pop this morning off the Cohen news. I bought 40 of the 3/18 20c as a safer play with less upside but I didn’t buy in until the stock was back down around $20, and sold 10 of my contracts when it hit $22.50. I think it held up well after hours and should see another pop tomorrow and will plan to sell the rest tomorrow if it does.

MNDT - Had a huge jump off the news that Google and Microsoft might be bidding against each other for the company. I bought 10 of the 3/18 25c once IV started to cool down and sold 3 contracts to cover most of my cost basis. This did not hold up well after hours so I may end up trimming these for a loss over the next two weeks, but that’s ok because I’ve covered cost. Just a reminder to myself why that is so important.

CCL - Thots is the cruise queen and she has given some great analysis on Carnival. I agree with her that the stock should rebound as Covid fears continue to go away and travel increases. My calls are Jan 2023 so I didn’t do anything with these today. But that itself I think is noteworthy. There was a time when I would have averaged down on a day like today. The thing is I already have 20 contracts. That’s more than enough. Averaging down would have put me too heavy into a play based on someone else’s DD. So I’m noting this more for myself and reminding me that sometimes showing restraint can be just as important as taking profit.

UVXY - if SPY rebounds later this month, these UVXY April puts should pay nicely. I could have gotten a better entry later in the day and could have averaged down, but I was comfortable at 4 contracts and determined not to go over that. Again, staying disciplined.

Mistakes:

MAXR - to be honest I don’t remember why I bought these 2 calls. I think we were talking about the company in VC and I liked what I heard. My mistake was buying them without doing my DD. But, as you can see with SOFI below, at least this time I only bought 2 calls so damage in minimal. I need to keep minimizing my losses while taking advantage of gains when I see them.

LAC - Lithium prices are just not going up. Again, only 2 calls thank goodness.

AEO - This one is Tmilly’s fault. In all seriousness though, it was just for funsies and again only 2 contracts.

SOFI - my biggest mistake so far in doing this journal. I’m going to wait for a SPY rebound later this week and cut my losses. I’ve discussed my mistakes many times above so won’t repeat them here, but it will be nice to get this one off the balance sheet and never look back.

Still holding RSX and OZON. We’ll see what Tuesday brings. Cheers!

[Machetephil]

Total as of 3-8-22: $64,864.61 (not including my 200 RSX puts on Webull)
Day P/L: $1,354.76 (2.13%)
Total P/L: $22,634.06 (53.59%)

Just a couple of quick notes as I don’t have as much time today to give an update:

-Sold my UVXY puts the second they turned green as SPY rallied post-Biden speech. Quick $144 profit and I can move on since I think UVXY is probably headed up in the near future.
-Sold my AEO calls for a loss so I could move on from them once SPY hit 427.
-Averaged down my WEAT calls so now I’m at 40 of the 4/14 10c with a cost average of $2.25. (All the news today was bullish for WEAT and I continue to believe WEAT will go back up above $12 and head toward $12.50).
-Scalped some SCO calls for a very small profit.
-Bought 10 of the 3/18 19c for VALE. I read the Bloomberg article after listening to folks in VC discussing VALE and I think this might be a good value. BUT, here is my current trading plan for VALE: sell tomorrow, 3/9, which is the dividend date for VALE. I am betting on a pop based on the dividend date. Buy calls in the morning 3/10 after market open and people dump their VALE position post-dividend, but before the London Market Exchange opens up. I am betting once LME opens, nickel will go up causing VALE to go back up.
-Sold all but 10 of my BBBY calls when it broke $23 this afternoon. Still holding onto those 10 to see if Cohen takes this to $26.

[Machetephil]

Total as of 3-9-22: $62,339.55 (not including my 200 RSX puts on Webull)
Day P/L: -$2,526.06 (-3.89%)
Total P/L: $20,108.00 (47.61%)

Pretty tired from work and RSX stuff today so not a lot of updates. This was not a good trading day for me.

-I am too heavy into WEAT at the moment and I’m hoping for a pop soon to help me out. At least they are April calls that are ITM, so I have some time before I need to be nervous, but it’s too much of my portfolio in once place.
-I averaged down on some SPY puts and I’m hopeful I will end up slightly green on them, but will need SPY to touch 425 for that to happen I think.
-Finally pulled the plug on SOFI. Goodbye forever.
-VALE never got the dividend date pop so I’m still holding to see if LME opens nickel market.
-Oil is hurting me in the face. I definitely made a mistake not cutting yesterday.

Let’s hope for an RSX unhalt in the morning. Cheers!

[Machetephil]

No update today. Just not up to it. Fingers crossed for RSX news tomorrow.

[Machetephil]

Back after a brief hiatus to deal with all the crazy RSX/OZON shit. If you want to know more, just go check out the RSX/OZON thread. I’ll talk about where I’m at on it briefly below. Now it’s time to get back to some focused trading.

Total as of 3-21-22: $51,172.55
Day P/L: -$13.36 (-.002%)
Total P/L: $8,942.00 (21.17%)

You can see from my positions above that I have been way too focused on RSX/OZON and learned another important trading lesson: Never trade while you are distracted. Only trade when you have time to focus on trading.

Bangers:

HGEN: After getting destroyed by HGEN in 2021, I had good entries in 2022 and they have paid off so far, with a 43% banger so far. I still think is headed back up to $5-$6 soon as the ACTIV-5 trials should be completed soon.

OZON (???): I exercised my OZON puts and I’m now short 1,000 shares. While this currently shows up as a $9,410.00 loss on TD, I fully expect OZON to delist and never have to deliver these shares, which would result in a total gain on this trade of $18,820.00.

Mistakes:

SPY: I bought some 435 SPY puts late last week and that was a mistake. SPY ran today and put basically any chance I don’t lose my investment on this at near zero. This was one of the trades I made while distracted.

WEAT: What can I say that I haven’t already said? Distracted. Trading. Is. Bad. I think I have a chance to get out even on this since I bought April calls, but this is not a great position to be in and I regret it.

Wait and See:

UVXY - Interested to see how volatile the market will be over the next few weeks and think these $17 calls will pay off eventually.

SST - I think this stock is overvalued and will continue to move down, but I don’t feel as confident as I once did.