How We Generated Returns Of 80% Annualized

During their recent episode of the Value Options Letter and Acquirers Podcast, Travis and Tobias discussed How We Generated Returns Of 80% Annualized. Here’s an excerpt from the episode:

So closed early. So those were all the ones that expired worthless. These were the ones that closed early.

So another benefit for subscribers is that if it makes sense to get out of the position, an alert will go out and it’ll be notified. The reason why you would do this is A, take risk off the table. B, maybe the trade’s made most of its money in a shorter amount of time.

And so your annualised rate of return is substantially higher. And C, it’s to free up capital. So we are capital constrained, all of us.

And you can’t set every single trade. And so it’s a way to recycle capital. You take your profit and then use that freed up money to set new trades.

So May 16th on Workday. So another one with Workday. We talked about that before.

We sold the $110 put. The stock was at $124.75. We collected $4.70 per share on this one. So this one had 33 days to expiration.

The cash requirement was $10,530. And Workday rallied very aggressively to about $146. And we were able to buy back the put at $0.15. So we made 97% of the profit and there were still 15 days left on the trade. So that’s an 80.6% annualised return. Nice work. Yeah.

So it’s an attractive way to do things. And since you still have $10,530 tied up, why not take profits there? And looking back now, Workday has come down a bit.

A lot of these stocks have come back down. So it’s still above $110. But taking profits is not something to sneeze at, particularly when it’s options and you want to free up the capital and that sort of thing.