Greetings all, over a few years I have focused primarily on FX which has its advantages and disadvantages - I have a great tehnical understanding of instruments and I am able to make valued judgements however this is only a small portion of the big picture. CFD’s don’t entice me but actual shares do because I am able to connect with the company beyond “PRICE GO UP!”.
Hence over the last 2 weeks I opened my own account and began populating my portfolio - bear in mind these are my first ever investments over than my FX and ETF’s.
What type of comments are you looking for specifically?
Diverse tickers = good.
However, 50% of your capital is in TECH. I mean, you basically constructed a thematic ETF- heavy on tech (semis) and finserv. AMD + NAVI are 70% of your book (going off purchase price).
When things appreciate and become outsized, you need to trim and you need to set those thresholds up before entering the positions.
What’s your strategy for finding trades?
Are you using options to enhance your cost basis? If not, why?
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Hey @FOREXunlimited thanks a lot for the reply,
My expertise in building a portfolio is that of a newbie - this is my first and only portfolio so I do appreciate the constructive criticism. I did try and diversify as best as possible but always got drawn towards the tech stocks as of late.
My idea for an efficient market is when the pendulum of confidence swings into negative regions (tech stock slips and bond yield drops affiliated with tech stocks) an injection into the market large enough to cover some of those loses will prompt other investors into those markets. I had bought AMD and NAVI just before Biden’s injection which will show short term gains. That is the reason for buying those two.
I agree that I need to sell off some of those shares in order to keep thresholds up and will do so on Monday after seeing the opening prices.
My strategy consists of finding undervalued stocks based of Fundamental data, once identified I will look at their reports, revenues and future plans just to ensure that they don’t plan on cutting jobs in the near future and hope to see expansion within the business. I will say it is a basic strategy that has flaws but for a first attempt (2 weeks) I feel accomplished.
Finally, I am not using option trading right now due to the fact I am not fully confident in using them and need to spend some extended time researching and learning. If you could suggest any courses or websites where I can learn more about them it would be greatly appreciated.
As has the entire market for the last 10 years 
(even moreso over the last 12mo).
Not sure what you mean by this? Injection as in stimmy checks? Or the FED?
What type of fundie data?
What if this leads to decrease costs, which leads to shareholder value appreciation and more efficient business operation?
Keep it up, you’re doing great and will figure out new things daily.
You need to change this right now. Spend the weekend watching as many videos from TastyTrade that you can. Start with “covered calls”. You can tell the difference b/w a true pro trader and someone still learning pretty quickly— pro’s are all about reducing cost basis. Dollar cost averaging, selling calls against positions, being the two foremost methods. On top of covered calls, research cash secured puts and/or SELLING naked puts. All of this is how you improve your returns.
Options are not inherently risky, and, I’d argue are designed to be seemingly complicated. When you peel back the onion, it’s a joke how simple the concepts are.
You are on the right path.
Jake
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Greetings Jake,
Thanks a lot for your advice and of course I took some time and learnt the basics of hedging risk and reducing my costs whilst maximizing my returns - I am greatly thankful for your advice.
To ensure I am doing it right would you possibly be able to look at this position?
If you remember I had 500 shares in Ford but I ended up selling off some, additionally I have a Call option to “Buy at market” which has a strike price at 18. I felt $18 was a fair price, please tell me if I have done something wrong here (this isn’t real money)
That’s one side of the coin- never stop seeking out educational material on the topic, it is advanced so naturally it will take time to stick.
It’s never a bad idea to take some money off the table.
I can’t tell what the details of the option position are from your screenshot. Are you saying you bought (went long) 2 of the 18C expiring on Mar 19?
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Yes the platorm stated “Buy at market”
Keep working on educating yourself r.e. available options strategies.
Read up on implied volatility and how it relates to option premiums. That’s the single most important concept.
Buying a call option gives the holder the right to purchase stock at the strike price.
Selling one obligates the seller to deliver shares - or, be short at the strike if you’re naked. Selling calls against a position (in blocks of 100 shares) is the most straightforward way to reduce cost basis. There are trade offs, obviously.
Selling puts obligates you to buy the stock at a certain price. This is good if you’re expecting a pullback and want to get long. Or, just want to collect premium.
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I agree that specializing in one thing can get you great results. But it doesn’t mean that you should not move with time. There are so many things that can be done once you learn one skill. Portfolio diversification is highly recommended in the market so that you can manage risk easily and gracefully.
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I would say 2 things here:
Diversify
Keep learning
