Our first interview! Ever! Be sure to check out our…
Interview on the Amber Tree Leaves Blog
We talk about everything related to our options trading strategy! Thanks, ATL, we’re honored to be featured in your option interview series! But whether you are interested in options or not, make sure sure you check out the ATL blog. Great work on everything related to FIRE.
And there’s more to come: we got the next interview lined up at yet another blogging friend of ours. Tentatively scheduled for next month, so stay tuned!
Great interview. I just read it over at ATL. You gave me a lot of new information to research in my free time. Thanks and best of luck to you.
Thanks, that’s a great compliment. Happy to share our experience on everything finance!
Cheers!
Great interview and analytical insight into options trading. Interestingly, I also trade options to initially augment my day-job income. I also started my trading business around 2011. Through thick or thin over the years, my trading volume has steadily increased. My number of trades in 2017 is around 10000. It was supposed to be my part time endeavor and now consumes more and more of my time as my activity level also increases over the years. I also sell a lot of puts but will manage the delta of each trade in case my assumption is wrong via buying long puts and/or selling short Call spreads, or calendar spreads, etc. I don’t normally trade SPX or SPY unless the implied volatility ranking is high. Like in 2017, despite the VIX is low, there are other underlying equities and/or ETFs that have high implied volatilities from time to time. The ROC in 2017 is great but I also recognise that the return is unusual and abnormal, and my financial returns of the taxable trading account have exceeded my day-job income by a good margin over the last few years.
Oh, wow, that’s a lot of trading! How do you keep track of capital gains for tax purposes? My gains age all Section 1256, so tax season is a breeze!
I trade the ES put options three times a week. It will be my “4 hour work week” (actually more like a 1.5 hour work week) once I’m retired! 🙂
I keep a trading journal in Excel to keep track of my P&L. However, going forward, I would elect the option of mark-to-market with the IRS and I can just keep track of the account values at the end of two consecutive years to track the P&L. I will also wait for my accountants to tell me whether we will be able to put the trading business in a pass-through entity to take advantage of the lower tax rate. Last year’s P&L is good enough to my total incomes (day job plus trading) to the 39.5% income tax bracket. Including the CA high tax rate, the taxes are killers.
Thanks for this info! Taxes can ruin this, that’s for sure. So I like the idea of options on futures. Then leverage is easier to overcome the tax drag.
Thank you for taking the time. your blog pushes me to think a little further on emergency funds, risk, trading!
Thanks! Always trying to be non-consensus. It’s a great conversation starter!
Cheers
Congrats, ERN – headed over to check out the interview now!
Awesome, enjoy!