I think that if the US government reported true GDP we would have had negative economic growth most years since 2008. But that hasn't stopped one of the best bull markets.
Printing more dollars isn't the problem when you have the reserve currency. The problem is the US is creating more claims (dollars) against commodities and resources.
The S&P 500 has little or no exposure to the things we need, such as copper, oil, natural gas, silver, uranium, coal, and shipping/tankers.
We could argue that growth will come from tech and AI stocks. However, the energy they need is growing exponentially.
We have exponential growth in claims with diminishing growth in resources.
Not investing would be the worst thing we could do. Investing in risky penny stocks would be the other dangerous extreme.
I think one solution is increasing our financial intelligence. Learn how to have a small percentage of your portfolio match or exceed the returns of the S&P 500 for your entire portfolio.
The problem is most people underperform trying to get "too cute" with their opinions on what the S&P 500 needs to do or have as they try to outperform it. The real problem is a lot of doom and gloomers in the media scare regular folks into getting too cute or not investing, when what we should really be doing is showing them how powerful it is to focus on the long term accumulation of the index. Instead, everyone focuses on doom and gloom arguments for why the index will crash or not maintain historical returns -- and then they underperform the index along the way.
Why are they not invested? They are scared of losing money.
My challenge is to hedge 80 to 90% of my portfolio using only 10% to 20% with undervalued industries and synthetic covered calls. That way I’m always invested. However, I’ve found that my 10% is outperforming my 90%.
There’s a good possibility that as the US government exponentially creates more dollars and the growth of commodities slows, real inflation will take more of the S&P 500 returns.
Please don’t take my comments as criticism, I enjoy covering both sides of the debate.
I find it very hard to believe that 10% of your portfolio in synthetic covered calls is outpacing S&P 500 or Nasdaq returns during the most recent 20%+ bull markets.
For example, $90k generating a 20% return gives you $18k.
There’s about a 0% chance that $10k in covered calls is making over $18k. That’s a 180% return lol.
Covered calls are a bullish strategy that limits gains and generally underperforms in larger bull markets.
A few corrections. I said that I'm using synthetic covered calls, not covered calls. Synthetic covered calls have more leverage and less downside risk when used properly.
I have a few synthetic covered calls that have reached an infinite return. Not only has it paid back all of my cost, it pays me weekly premium.
Yes, my synthetic calls return about 3 to 5% a week on average of my initial investment. It's fairly steady because I balance with TLT synthetic covered calls.
For example, the hypothetical $10,000 would earn about $500 a week, that's over $15,000 to $25,000 annualized, not including compounding.
I share my trades on my Substack at the end of every week.
Synthetic covered calls are probably just vertical spreads I assume. In any event, any type of covered call is a bullish strategy that limits upside profit potential.
If you were making $15k-$25k annualized on a $10k investment and that’s only 10% of your portfolio why would you even invest the other 90%? Just leave it in cash and let that small amount of money do all the work for you, or simply increase allocations to what has been working better.
Honestly, I simply don’t believe that you have been able to do that for a sustained period of time.
You posting a few exit trades is not proof.
If you can achieve those returns, you are one of the best investors/traders to ever live, and you should consider opening up a private fund. Investors on Wall Street would throw trillions at you for even a quarter of those returns.
In any event, I’m still waiting for you to give me the go ahead on getting on a zoom call or podcast to record so that we don’t need to keep going back and forth via the keyboard on every single one of my posts.
Synthetic covered calls have more upside than vertical spreads.
I post every portfolio trade when I make it on my Substack and I recap the weekly returns on the weekend.
For my model portfolio, I Invested no more than $2,500 at a time, meaning I only risked $2,500. I waited for trades to close to add more.
The value over that time increased $383, 15.3% in five weeks. The trades I closed averaged a 10.2.% ROI. I have a few open trades that have brought down my total return.
Yes, that is a small sample. However, I’ve had similar returns using a portion of my portfolio this year. I would’ve had a far better your, but I made a series of calculated risks to become a better trader.
Since I’ve started focusing on what I’ve found to work and avoiding what doesn’t, my portfolio is performing well.
I have more than 10% of my portfolio invested this strategy. However, much of that is in TLT synthetic covered calls. These have paid down all my cost and now pay me risk free return premium. This is my dry powder waiting for good opportunities.
I will gradually increase the allocation overtime. However, I’m also building a dividend portfolio and a ratio portfolio.
No, I would never request or take anyone’s money for investing. I only share what I do and how to do it yourself.
The reason this strategy is effective is very few people understand it. Also, it would be harder to do with a large amount of money.
Thank you my friend, I will get back to you about an interview.
My opinion - the US economy is resilient. We can't avoid occasional corrections in the stock market. Old technologies could also make the impression things are getting worse. So let's look at new technologies. There are plenty.
I think that if the US government reported true GDP we would have had negative economic growth most years since 2008. But that hasn't stopped one of the best bull markets.
Printing more dollars isn't the problem when you have the reserve currency. The problem is the US is creating more claims (dollars) against commodities and resources.
The S&P 500 has little or no exposure to the things we need, such as copper, oil, natural gas, silver, uranium, coal, and shipping/tankers.
We could argue that growth will come from tech and AI stocks. However, the energy they need is growing exponentially.
We have exponential growth in claims with diminishing growth in resources.
Not investing would be the worst thing we could do. Investing in risky penny stocks would be the other dangerous extreme.
I think one solution is increasing our financial intelligence. Learn how to have a small percentage of your portfolio match or exceed the returns of the S&P 500 for your entire portfolio.
The problem is most people underperform trying to get "too cute" with their opinions on what the S&P 500 needs to do or have as they try to outperform it. The real problem is a lot of doom and gloomers in the media scare regular folks into getting too cute or not investing, when what we should really be doing is showing them how powerful it is to focus on the long term accumulation of the index. Instead, everyone focuses on doom and gloom arguments for why the index will crash or not maintain historical returns -- and then they underperform the index along the way.
Yes, the goal is to keep people invested.
Why are they not invested? They are scared of losing money.
My challenge is to hedge 80 to 90% of my portfolio using only 10% to 20% with undervalued industries and synthetic covered calls. That way I’m always invested. However, I’ve found that my 10% is outperforming my 90%.
There’s a good possibility that as the US government exponentially creates more dollars and the growth of commodities slows, real inflation will take more of the S&P 500 returns.
Please don’t take my comments as criticism, I enjoy covering both sides of the debate.
I find it very hard to believe that 10% of your portfolio in synthetic covered calls is outpacing S&P 500 or Nasdaq returns during the most recent 20%+ bull markets.
For example, $90k generating a 20% return gives you $18k.
There’s about a 0% chance that $10k in covered calls is making over $18k. That’s a 180% return lol.
Covered calls are a bullish strategy that limits gains and generally underperforms in larger bull markets.
A few corrections. I said that I'm using synthetic covered calls, not covered calls. Synthetic covered calls have more leverage and less downside risk when used properly.
I have a few synthetic covered calls that have reached an infinite return. Not only has it paid back all of my cost, it pays me weekly premium.
Yes, my synthetic calls return about 3 to 5% a week on average of my initial investment. It's fairly steady because I balance with TLT synthetic covered calls.
For example, the hypothetical $10,000 would earn about $500 a week, that's over $15,000 to $25,000 annualized, not including compounding.
I share my trades on my Substack at the end of every week.
Synthetic covered calls are probably just vertical spreads I assume. In any event, any type of covered call is a bullish strategy that limits upside profit potential.
If you were making $15k-$25k annualized on a $10k investment and that’s only 10% of your portfolio why would you even invest the other 90%? Just leave it in cash and let that small amount of money do all the work for you, or simply increase allocations to what has been working better.
Honestly, I simply don’t believe that you have been able to do that for a sustained period of time.
You posting a few exit trades is not proof.
If you can achieve those returns, you are one of the best investors/traders to ever live, and you should consider opening up a private fund. Investors on Wall Street would throw trillions at you for even a quarter of those returns.
In any event, I’m still waiting for you to give me the go ahead on getting on a zoom call or podcast to record so that we don’t need to keep going back and forth via the keyboard on every single one of my posts.
Synthetic covered calls have more upside than vertical spreads.
I post every portfolio trade when I make it on my Substack and I recap the weekly returns on the weekend.
For my model portfolio, I Invested no more than $2,500 at a time, meaning I only risked $2,500. I waited for trades to close to add more.
The value over that time increased $383, 15.3% in five weeks. The trades I closed averaged a 10.2.% ROI. I have a few open trades that have brought down my total return.
Yes, that is a small sample. However, I’ve had similar returns using a portion of my portfolio this year. I would’ve had a far better your, but I made a series of calculated risks to become a better trader.
Since I’ve started focusing on what I’ve found to work and avoiding what doesn’t, my portfolio is performing well.
I have more than 10% of my portfolio invested this strategy. However, much of that is in TLT synthetic covered calls. These have paid down all my cost and now pay me risk free return premium. This is my dry powder waiting for good opportunities.
I will gradually increase the allocation overtime. However, I’m also building a dividend portfolio and a ratio portfolio.
No, I would never request or take anyone’s money for investing. I only share what I do and how to do it yourself.
The reason this strategy is effective is very few people understand it. Also, it would be harder to do with a large amount of money.
Thank you my friend, I will get back to you about an interview.
Rrr. ;njj
Great post!
Unfortunately, negative news sells more in mainstream media. That’s not an issue just for stocks but in general in news outlets.
Personally, I barely read any news and focus on the price action and studying companies and charts
My opinion - the US economy is resilient. We can't avoid occasional corrections in the stock market. Old technologies could also make the impression things are getting worse. So let's look at new technologies. There are plenty.