February 2025 Report

This will be just a short post as there is really nothing new to add other than I’m back to break even after generating positive results in February. Visa was a big reason for this gain as this sleeping giant has come back to life. Apple and Mastercard generated more modest gains. Constellation Brands stabilized a bit after news that Berkshire Hathaway initiated a stake in the company, but the stock still declined ~ 3% for the month. Overall, I remain cautious with this market and continue to build cash (~10% of portfolio) from premiums generated from selling options. I have no problem sitting on cash yielding ~ 4% while waiting for opportunities to show up.
 
2025 Performance = + 0.11% with the running monthly returns as follows:

January - 2.61%
February + 2.79%

January 2025 Report

The New Year has started out with a dud with the portfolio generating a return of -2.61%. This can be attributed to Constellation Brands (down ~ 18.2%) and Apple (down ~ 5.8%). Constellation Brands sold off on disappointing earnings and the upcoming tariffs on Mexico. Hopefully, the tariffs are just temporary, and things can get back to normal. If Constellation Brands sells off more, I will start adding to the position as its valuation is very attractive and the stock has priced in so much bad news. Apple needs to get its AI implemented in additional countries before people start upgrading their older iPhones, but I have confidence in Apple getting this done. What saved the portfolio was Visa, which gained ~ 8.2%. Visa has done nothing for almost 2 years and finally came back to life, so patience does pay off. So, maintaining ~ 10% cash position and will see how things play out.

Yes, still messing around with selling short Puts to generate some additional income. I’m getting more nervous as investor sentiment is at its high point, which can lead to a nice market correction. I’ve been using 50% plus of my margin buying power with the naked puts, which is in the danger zone so I may back off a bit. I’ve been lucky so far with picking up pennies in front of the steam roller.

In the Chinese Zodiac, this is the year of the snake so one needs to be extremely cautious with their investments.

2025 Performance = - 2.61% with the running monthly returns as follows:

January - 2.61%

2024 Year End Performance

In my 2023 year-end review, I said that I would be happy if I can generate a 10%+ return in 2024. Well, I am grateful that I was able to generate a return of 20.74% for 2024 even though this underperformed the S&P 500 return of ~ 23%. When the portfolio was smaller, I was nimbler and was able to consistently beat the S&P 500. Now with more of a buy & hold approach and old age, it’s getting harder to beat the index. It does make me think about going into the index funds, but I enjoy this game too much and doubt I will ever go all index.

I can once again thank Apple for making a strong year end come back, which really helped the portfolio. Visa and Mastercard also generated decent returns. The only disappointment was Constellation Brands, which sold off on the risk of tariffs since all of its products are manufactured in Mexico. I still intend to hold into Constellation Brands as it provides a nice steady dividend. I did sell Ginkgo Bioworks to take advantage of the tax loss but may get back in at some point.

When I initially purchased these positions, I never thought that I would hang on to them this long. A nice metric that I focus on is Dividend Yield on Cost. This is looking at the current dividend and the cost basis of the position. With these yields, I really have no reason the sell off any of these positions. I view these as growth and income positions.

Holdings as of 12/31/24

I continued to be fairy active selling naked Puts on the high beta tech stocks (i.e. Tesla). This helped to generate some nice income, but obviously comes with risk. As I said before, all you need is one black swan event and it’s over. It looks like everyone is using this strategy to generate income as seen with the explosive growth in the options volume. I do wonder when the party will be over. In this game, one wrong move came wipe out years of hard work. I’ve experienced the Asian, Russian, 2000 tech bubble and the 2008 financial crisis. The COVID sell off was nothing compared to the 2000 tech bubble and the 2008 financial crisis. It may be prudent to start scaling back on this highly leveraged strategy.

I think this really sums things up for the year. As you can see from my monthly updates, it’s a really boring portfolio as nothing really changes from month to month.

Once again, I will be happy if I can generate a 10%+ return in 2025!

Have a Happy New Year, Good Health and Fortune to All!

 

2024 Performance = +20.74% with the running monthly returns as follows:

January +0.02%
February +0.99%
March -0.33%
April -3.07%
May +5.16%
June +3.52%
July +2.42%
August +2.52%
September +2.11%
October -1.76%
November +6.20%

December +1.61%

 

Annual performance for the past thirteen years is as follows:

2012 +61%
2013 +44.61%
2014 +29.47%
2015 +33.48%
2016 +14.61%
2017 +42.12%
2018 -4.11%
2019 +40.17%
2020 +32.81%
2021 +13.58%
2022 -14.14%

2023 +29.76%

2024 +20.74%

CAGR from 2012 to 2024 = 24.84%

November 2024 Report

This has been a difficult year as I’m currently underperforming the S&P 500 by ~ 10%, but November produced some nice gains with a rally in Apple, Visa and Mastercard. I was surprised that Visa had such a strong gain in the face of the antitrust lawsuit. I guess the market is pricing in a more market friendly administration towards the financial sector. Visa is literally a printing press and it’s hard to bet against this company. What I have learned is to never sell a great company and just let the gains compound over time.

With the new administration, it looks like the IPO window will swing wide open. The IPO market has been in a dry spell for the past few years. It'll be interesting to see if some of the unicorns will decide to go public next year.

We’re entering one of the most bullish times of the year and looking forward to the market close out on a strong note. I just have to be cautious with my options plays. I’ve been way over leverage at times and need to take step back. With selling naked options, you cannot make a mistake or else it will cost you quite a bit.

 
2024 Performance = + 18.83% with the running monthly returns as follows:

January + 0.02%
February +0.99%
March – 0.33%
April - 3.07%
May + 5.16%
June + 3.52%
July + 2.42%
August + 2.52%
September + 2.11%
October – 1.76%
November +6.20%

October 2024 Report

I was on a small winning streak for a few months but gave some back in October. This was the start of the Q3 earnings report and many sold off on the results. The only change to the portfolio was Ginkgo Bioworks, which I sold to harvest the tax loss. I may jump back in as my original intention was to hold onto the position for a while. 

I continued the option selling game and dodged a couple of bullets. I almost jumped into the short puts for Capri Holdings as the premium looked attractive, while the market was anticipating a positive antitrust outcome. I was surprised that the judge blocked the deal and the stock plummeted, which would have destroyed me if I had entered the short puts. The other close call was the Tesla earnings report and was going to short the calls. I would not have expected Tesla to jump 20% on the earnings report, which would have hit me hard. Fortunately, I decided at the last minute to sell the Tesla puts. These are the dangers of selling naked options.

The market is rallying big time with the upcoming change in administration. With the fed cutting and a market friendly administration, it’s hard not to be bullish. I think it’s pretty much an all clear signal to put some cash into this market.

 
2024 Performance = + 11.90% with the running monthly returns as follows:

January + 0.02%
February +0.99%
March – 0.33%
April - 3.07%
May + 5.16%
June + 3.52%
July + 2.42%
August + 2.52%
September + 2.11%
October – 1.76%

September 2024 Report

I’m still status quo and just continue to build up cash. I was able to crank out a return of 2.11% for September. Cash is still attractive for the time being with money markets yielding around ~ 4.6%. I’ve become much more conservative with my investment style as I get older. I remember in my younger days I would go on full margin with risk arb plays and on occasions even getting margin calls. Those days are long gone, and preservation of capital is an important strategy for me. You don’t want to make a wrong move and loose a fortune.

No changes were made to my portfolio as I continue to look for value plays, which I am unable to find. I was hoping Visa would decline more with the recent antitrust lawsuit so I can pick some more up. I really fine it annoying how this administration is filing antitrust lawsuits left and right. I hope they start losing some of these frivolous lawsuits such as Tapestry’s bid for Capri.

It looks like the IPO market is starting to thaw with some recent filings. I was trying to get my hands on Standard Aero but was not able to get an allocation. This company was priced very attractively as it was clearly underpriced to ensure a nice IPO pop. Looking for some top tier companies to come public such as Databricks, Stripe and of course SpaceX.

2024 Performance = + 13.90% with the running monthly returns as follows:
 
January + 0.02%
February +0.99%
March – 0.33%
April - 3.07%
May + 5.16%
June + 3.52%
July + 2.42%
August + 2.52%
September + 2.11%

August 2024 Report

During the recent volatility, the best action for me was to do nothing. It’s really hard to pull the trigger as I did not see any real values during the sell off. The only action I took was to sell puts on several tech stocks during the sell off. There was fear out there so the option premiums were quite attractive. The market should be fine. with the anticipated September rate cut. As they say, “Don’t fight the fed”.
 
So, what did well in August? Apple, Visa and Mastercard… Apple continues to rally on the highly anticipated iPhone 16 launch. Do I buy this Apple AI upgrade cycle? Definitely, I actually purchased a new iPad Air to take advantage of the upcoming AI features. This will be nothing like the muted 5G upgrade cycle where the user did not really have any use cases. Visa and Mastercard are rallying based on the anticipated rate cut that will spur the economy. Visa and Mastercard are amazing companies, they do well in all types of economies.
 
I’ll continue to play it safe for the remainder of the year by maintaining a healthy cash position of ~9% and try not to do anything stupid. There will likely be some volatility as we head toward the elections.
 
 
2024 Performance = + 11.55% with the running monthly returns as follows:
 
January + 0.02%
February +0.99%
March – 0.33%
April - 3.07%
May + 5.16%
June + 3.52%
July + 2.42%
August + 2.52%