January 2017 – Options Income

A few weeks ago I came across the blog Options Hunting. The author compiles a list of monthly income by selling options. As I mostly sell options (I also have a few dividend stocks, mostly REITs), I wanted to take part in the friendly “competition”.

I also found a German blog with another list: Easy Dividend.

As this is my first monthly post, let me explain a little bit what I do. I have a simple strategy, were I sell far out-of-the-money options on the E-Mini S&P 500 futures. These options usually have 90 – 110 days left till expiration and I select the strike price to get a premium of 4 – 5 dollars. My profit target is 50 %. I have roughly 40k in the account (this account is in US Dollar – my other accounts are all in Euros). My expectation is around 2 % per month.

With my main accounts I do complex options positions. These are multi-legged constructs. An Iron Condor is such an example (which I do not trade – I do not want to go into too much detail).

Currently, my book keeping is not good enough, so I can only give MTM numbers from month to month. But this also includes dividends, stock gains and EUR/USD gains. So for the moment, I will leave this part out (the MTM numbers are in my net worth posts). But I plan to later include it – especially because the account size is bigger there.

Far OTM option selling (MTM)

  • January 2017: 1.9k

Far OTM option selling (closed trades)

  • January 2017: 1.6k

January was a fabulous month. I gained over 4 % – double what I normally would expect.

I only look at MTM changes and don’t care about closed trades. But I mention them here, because all the numbers of other traders seem to be based on this.