The last 3 weeks I made about 2% returns on NVIDIA option trading, to annualize it, the return would be about 35% annually. To add my first 3-week option trading and the last 3-week option trading, the return is about 7% for the 6-week run. If we make it to be a two-month return, then annually it would be around 40% returns.
Again, I do not know if the 7% run rate is sustainable or not, so it is still a question mark on the 40% return annually with NVIDIA option trading.
A couple of lessons learnt for the past 6 weeks for myself:
- I think I worked too hard while trading options – meaning, I do not need to trade every week. Instead of having the weekly or monthly goal of returns, waiting on the right opportunity should be my goal. For example, I traded one put last week while the stock price was the highest during the last two week, so the return on that put was the lowest during that time period
- I think about the 20/80 rule, which is quite true in a lot of aspect of our lives. So, going forward I will use 20% of my focus to drive 80% of the returns I am seeking, to quantify that, instead of trade weekly, I should practice my patience, relax my mind to wait for the right opportunities, – so I will trade no more than twice a month.
What I need to avoid is to sell calls while stock price declines, and sell puts while stock price climbs up.
If you have any option trading experiences, welcome to leave comments so we can all learn together.
Disclaimer: I am not a financial advisor or lawyer. What I have published in this article is based on my own understanding of finance and economics. It is for my personal hobby and entertainment purpose only. Please do not take it as financial, investment, or trading advice. Please conduct your own research before making any financial, investment or trading decisions.