TIB: Today I Bought (and Sold) - An Investors Journal #190 - Oil Drillers, Marijuana, Covered Calls, Altcoins, Bitcoin

US Markets took a step back on the back of poor Walmart results and a strong Treasury auction which buoyed the US Dollar. My trading focus for the day was writing covered calls on US stocks and getting my own crypto trading robot running. It made profits on day one.

Portfolio News

Legalising Marijuana UK Parliament is set to debate the legalisation of cannabis this week.

https://www.rt.com/uk/419202-cannabis-legal-weed-drugs/

There is precedent in the UK as Members of the Welsh Assembly showed strong support for legalisation of medicinal cannabis last month

http://www.bbc.com/news/uk-wales-politics-42709244

Last month news from Vermont legislature which legalised marijuana use and possession but not sales - you have to grow your own.

http://www.independent.co.uk/news/world/americas/us-politics/vermont-legalises-cannabis-recreational-marijuana-trump-crackdown-republican-phil-scott-a8173246.html

Bought

Gulfmark Offshore, Inc (GLF): US Offshore Driller. My standing low ball bid catches a nibble for small parcels every now and then. Accumulative trading costs at $1 per parcel are beginning to mount.

MMJ Phytotech (MMJ.AX): Australian Marijiuna. Price has pulled back after making a strong surge. I added another small parcel to one of my portfolios on the pull back to average down a little. MMJ is a medicinal cannabis business operating in Australia, Switzerland and Israel and owns 60% of Canadian producer, Harvest One (HVST.TO)

Income Trades

A quick reminder on my process for writing covered calls.

1. Select stocks I am happy to sell if I get exercised.
2. Calculate 5% move up in price from previous day close
3. Choose a one month out call option closest to 5% move up in price.
4. Place a bid between bid and ask. Ideally one should aim for a premium of about 1% to make this worthwhile - I do not check but I did average 1% for March

Overnight bids on two Swiss stocks were hit. I chose to write a call option on the UBS Group (UBSG.VX) trade I made in error the previous day. Trading costs on Swiss options are high - I will stop writing here after this month. I added one new covered call on BNP Paribas (BNP.PA). I wrote a bunch of calls on US markets some of which are new. The table below summarises the story.

The table shows purchase price and closing price, the premium received and the % relative to close and to purchase price. The strike is shown and the important columns after that are the amount price has to move to reach the strike price - you will see they are all around 5% with a few more than that. The net cost column is updated each month to show purchase price less accumulated premium received - the percentage column at the end shows what contribution income has made compared to purchase price.

I like writing covered calls in US markets as trading costs are low (mostly less than $1 per trade) and liquidity is quite good. Sometimes though I am the only person out there providing liquidity - take Fluor for example yesterday

Cryptocurency

Bitcoin (BTCUSD): Price range for the day was $700 (6.3% of the low). As price was moving up I computed the relative move from the low. The one hour chart does show the pattern I have been observing - 4 or 5 higher highs and then a sharp pull back.

On my Bitmex account, I opened one new trade at $11,450 on a mini reversal and looked like a hero for a while when price headed over $11,600. I have added one new entry at $11,350 this morning on the back of an inside bar and two consecutive low test bars.

CryptoBots I added one new robot to try to catch the bounce off the lows for some of the problem children. That robot opened 4 new trades and closed one out (ADA) for a 1.53% profit.

There are now 13 trades open and they are all looking like problem children - ENG, EOS, GAS, NEO, ETH, ZEC, DASH. The new robot has 3 problem children too - 2 in ETH and one in STRAT. When Bitcoin moves strongly this is not surprising.

I did implement my own trading robot using Profit Trailer software. The bot is trading on Binance in BTC markets where there is at least 200 BTC worth of trading volume in a coin per day. There were some teething problems which resulted in an ETH trade being opened multiple times (and ETH is looking ugly right now). The robot did close 5 trades for an average profit of 2.6%.

Do that every day will produce a very tidy capital accumulation opportunity. The mechanics of the robot are quite simple. It looks for a move upwards in a falling exponential moving average as a trigger. It trails the move to try to buy once the price has shown a bottom and bounced. Exit is after a percentage price increase but also with a trailing feature to try to capture a full run.

Currency Trades

Forex Robot closed 4 trades (0.17% profit) and is trading at a negative equity level of 9.8% (higher than prior day's 9.7%).

Outsourced MAM account I run an outsourced forex trading account with Actions to Wealth. They closed out 2 trades for 0.15% profits for the day.

Cautions: This is not financial advice. You need to consider your own financial position and take your own advice before you follow any of my ideas

Images: I own the rights to use and edit the Buy Sell image. News headlines are credited below each image. All other images are created using my various trading and charting platforms. They are all my own work

Tickers: I monitor my portfolios using Yahoo Finance. The ticker symbols used are Yahoo Finance tickers

Crypto Trading: get 6 months free trades with Bitmex for leveraged crypto trading. http://mymark.mx/Bitmex

My robot is trading also at Binance. Get reduced trading fees through http://mymark.mx/Binance

February 20, 2018