IB Account – 2021 Year End

The IB account generated a return of 17.5% (blue line) in 2021….within the goal of 1-2% per month but below the return of the SPX (500 stocks). Disappointed in performing below the SPX. My portfolio is overweighted on healthcare stocks. Omicron surge and the negative reaction was much higher in my account than the general market. At the end of October I was outperforming the SPX and looking at annualized returns in excess of 25%. Last couple of months were challenging.

No funds were added or removed from the account in 2021 .

The IB account was started with a $25,000 investment in 2012. No funds have been added or removed. The returns over the past 9 years have exceeded expectations especially in the past three years when I spent considerably more time on investing.

In the 4th quarter I added naked put writing to my strategy. Most of the open positions are comprised of a covered call + naked put. The naked puts are usually less than 50% of the number of covered calls. This strategy works well in a flat and up market. In a down market the naked puts amplify the losses on the stock.

A strategic decision that definitely impacted the return in 2021 was following the tax guidelines that do not cause the holding period on a stock to be reset (short calls have to be greater than 30 days before expiration and at least one strike price higher than the stock). Rethinking that decision for 2022 as a lot can happen in 30 days…..and any type of roll has to be out 30+ days.

Here is the portfolio leaving 2021……

Hearty Cooking!

Some local hunters dropped off a few interesting items to cook…..and it was interesting.

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This was my first experience cooking any type of heart. Cleaning the hearts was very time consuming….took me over an hour to clean the moose heart but I may have been overly diligent and cleaned more than I needed to. The bear heart was much smaller but I was surprised just how much smaller.

The bear heart was boiled for a very short period of time then sliced in rings. I was concerned it boiled too long (as it would get tough) but it turned out okay. The rings were heated up on the grill with a small amount of Kim’s homemade BBQ sauce. Not too much as I didn’t want to over power the natural taste. We served the bear heart as the appetizer. It was all eaten so I think it was a hit.

The moose heart was butterflied open so I had easy access for cleaning. After cleaning I used butcher’s twine to put it back into shape. The heart was marinated for about six hours in oil, vinegar, salt and pepper. Basic marinade to soften things up without changing the taste. We stuffed the heart with a bread stuffing prior to placing it in a roast pan. It cooked surprisingly fast….about 50% of what I was expecting. We let the heart “rest” for 30 minutes before carving it. Taste was excellent!

I would ask my wife to comment on the taste….but she stayed about as far from the kitchen as should could….and nothing got on her plate!

A fun meal that we shared with another family on the lake.

Oct IB Account Performance

Another month has come and gone……and it was a good month. Lots of travel, time with family, time with friends and a healthy market pushing to record highs. In the month our account increased over 7%….. above our monthly goal of 1-2%. YTD the account is now up almost 28% versus the S&P at 23%.

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In July we started tracking the % of stocks, options and net positions that were profitable. The tracking provided some interesting and helpful insights. We are frustrated with not making more profit with the options (covered calls are not the best strategy in a rising market). In addition to selling calls we added naked puts to many of the positions. The naked puts have helped offset the losses on the calls as the stock rises. When we started the tracking under 70% of the net positions were profitable (black line). This has improved to 93%. The tracking highlighted a couple of positions we struggled to turn around….so we closed them and allocated more money to our winning positions.

The table shows the current stock holdings in the portfolio. Column on far right is the annualized return on the position (stock+option+dividend). We have one losing position with NIO. Considering adding short puts to the NIO strategy to try and improve performance. In addition to short calls we have short puts on ABT, ATEC, BCRX, DGX, DXCM, PBR and SDC. Overall the options are still negative with DXCM having have a big influence on the overall option number.

If you have any questions on any of the holdings or the tracking don’t hesitate to ask.

We are up at the cottage in Canada for about a month closing things down for the winter. Weather has been cooperating. Chilly but reasonable. Nice time of the year to be at the cottage…..very quiet and no flies. A better internet would be nice….but what we have is adequate. Hopefully the market stays strong through November…..but the new highs do make me nervous!

We have a shed….

Lots of progress the last couple of days as we finished the siding and got the roof on.

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  Ryan picking up the roofing in Kamloops

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  Hopefully the last load of lumber

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  Siding on the back wall. The large opening is for driving a 4-wheeler in.

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  Finishing the siding on the roof of the deck

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  Front wall and side wall with siding

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  Finished siding the gable end on the back

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  I am too old and fat for working in attic

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  Making a door in back gable

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  Finishing up the front gable

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  Ryan bought this window on Marketplace….and he wanted it in

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  And we do our best to please him…..
  

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  Ryan screwing down the first piece of roofing metal…..is it straight?

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  Did we do it right?

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  Maybe not….but the roof is on….

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  Happy father and son….and we are still getting along….

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  Nice shot with scenery in the background and reflection in the windows….not sure it looks like a shed..

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  Jasper giving Ryan a high five on the job completion….now can we play?????

This morning I started the drive back to Andover at 4:45 AM. Had to leave really early before Ryan was up and wanted help with more of the finishing (making doors, adding the batten over all the siding cracks, adding trim around the doors and windows, adding fascia boards, etc, etc). So I quietly snuck away in the middle of the night.

Made it to Butte, MT….just over 500 miles….only 2,500 more to go. For my Canadian friends…..that is a lot of kilometers! Hope to do it in five days. Nice day for driving today….

Another day……a little more progress

Siding n

ow on three sides and on the ceiling of the deck

Added bridging on the side of the truss…..will do other side tomorrow

Siding on the ceiling of the deck

Bridging on the horizontal truss members to support the floor in the “loft” for storage.

Ryan went to pick up the metal roofing today. Hope to start doing the roof tomorrow afternoon

Another milestone…..siding is going on

We placed “briding” in the walls to nail the siding to

This is the end result of the bridging…..just asking for some siding to be applied!

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First piece of siding and the first wall almost complete. We are doing vertical “board and batten”. The wood is very green so the batten should help with the cracks from shrinking as the wood drys.

Ryan is headed to Kamloops this morning to pick up the metal roofing……so tomorrow we should be working on the roof.

Yesterday was a tough day in the market…..covered calls helped offset some of the losses but it wasn’t a great day. Hopefully today will be a better day. Looking better at the opening. Rolled down a couple of positions in Amazon and INMD.

This picture says it all…..

We managed to make Ryan happy today when we got the cedar logs off his property in place holding up the front of the shed. I think this picture made the entire trip out west worth it!

You want to get this log where? This was at the “just talking about it stage”. Ryan’s girlfriend, Cat, has joined us to help out with the build…..and it turns out she knows what she is doing and was very helpful.

The “chain saw carpenter” went to work and did an amazing job of cutting the logs to length (square cuts) and then cutting the notch for the top plate and header to fit. Nice job leaving the front of the log intact which is what you see when you look at the front of the shed.

Can you believe it! We managed to get both logs in place with the strength to carry the load of the last three trusses. The logs do add a nice touch….and he has 18 acres of trees so I suspect he will continue to develop his log building skills.

It is beer time……I’m outta here after a productive day!

The “Shed” is moving along!

When we ran out of wood (and something broke at the sawmill and we couldn’t get more 2 x 4’s) we switched to making our trusses. The first one definitely took a few hours to try, modify, try, modify, try……

Once we had our pattern the pace picked up. We decided to frame one of the walls in 2 x 6’s since we couldn’t get any of the 2 x 4’s. This allowed us to get the four walls framed and standing. The front shed wall has a five foot doorway so Ryan can open them wide and let some light in for working. The big doorway in the back is for parking a “yet to own” four wheeler. Plans are for that door to be a ramp that folds down. We put up the first and last trusses then filled in between. 9 of the 12 trusses are now in place with plans to finish the other three tomorrow.

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Weather continues to suck as it rained yesterday afternoon, all night and again today until after lunch. Lots of stars in the sky tonight so it should be clear “building” tomorrow.

The top plates that are protruding out the front still need supports. The plan is to use two cedar logs we cut and peeled. It should be fun incorporating actual logs into the build….definitely a Ryan request. If he could have the whole structure would be out of logs sourced from his property…..but we don’t have the knowledge or the time. Maybe the next structure will be out of logs!

Good week for IB account despite the distraction of building a shed

For the past week I have been “holed up” in Albert Canyon on a remote piece of property in the Rocky mountains. Maybe the distraction of building a shed, different time zone and slow wifi have limited my “reactionary trading” resulting in the IB account hitting a record high on Friday. For the week our profits were a little over $6,000.

My recent posts about building the shed have generated more than 10x the site visits! Guess that is much more exciting than updating about stocks and options.

Blue line is the account performance. Green is SPY. On Friday the account managed to create a nice positive variance vs the SPY.

Smile Direct Club continued a strong bounce from earlier losses. The stock profit is finally back into positive territory. With rapid stock movement the options lost money this week resulting in the overall position just about getting back to break even. I am currently short Oct 1 $6 Calls with the stock approaching $7 so we will have to roll the calls up and out this week.

DGX stock is continuing to push up and contributing to the performance.

Confluent stock has also been on a nice run following the IPO in July. I keep selling “out of the money” calls but the stock pushes past the strike prices so I have to roll the options at a loss. The IPO lock up is expiring in the not too distant future….so it will be interesting to see what happens with the stock. I don’t plan on rolling to strikes too far out of the money until the impact of the lock up gets “digested”.

Abbott has made a nice contribution since mid August. In addition to selling calls I also sold naked puts (okay to buy more of the stock if I got assigned on the puts). The addition of the naked put helped the overall performance of the options. Without the naked put the short call options would have offset some of the stock gains. With the naked put the combined stock/option position is much more profitable than just holding the stock. This is the graph visual I try. to achieve in all the positions…..with mixed results

As of the close on Friday the account has 14 open positions that are in the table below. We had a few short options expire on Friday. New calls on the expired positions will be written next week. We are profitable on 12 of the 14 stocks. (86%). Our option strategies have not fared as well with 6 being positive contributors (43%). The result on the options is not surprising given the recent strong performance by a few of the stocks. Overall we are profitable in 86% of the positions. I believe SDC will become positive in the near future. NIO remains a puzzle….not sure what the best strategy is…might be to exit the position.

Ongoing Shed Construction in Albert Canyon

Ryan and Cameron lead the initiative to get the floor joists in…..and we reached another milestone with the installation of all the joists. Next the plywood floor was nailed in place (Ryan wasn’t very keen on the $80 per sheet price tag on the plywood). The shed will be 10 x 12….with a 4 ‘ covered deck on front. We installed the floor boards for the deck.

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The wood we are using is all rough cut timbers (where a 2 x 4 is actually 2 x 4) from a local mill in Revelstoke. The boards it the pink/orange tint are BC fir. We are paying about $7 for a 2 x 6 x 12 board of BC fir . I can’t imagine what that would cost back in Ontario where Home Depot is charging $8 for a poplar or spruce 2 x 4 (not really….1 1/2 x 3 1/2 x 8). The only downside is the weight of the boards. They will not be blowing away!

Very wet day today in Albert Canyon. We worked in the rain till lunch to make some progress as the “clock to return home” is moving along. More pictures to follow….but all four walls are up and 9 of 12 trusses are in place….so we made some good progress.