Image Source: Flickr — Sub cash register by Franck Blais

Trading, rather selling options premium is now my full-time occupation since leaving my CEO role at the end of February. I may do some consulting but I really enjoy my trading job and on my current pace of 1.6% return per week, it pays just fine for our family’s needs. I had semi-retired after we sold Collective Bias and now, I’m done with full time work. Except that trading at this level is full time work. I make 25–60 or so daily trades on average and seek to maximize incremental returns vs. max profits.

$20 is often a nice profit…

Always Abol — NFT by John Andrews

Stocks had a good week, until they didn’t and then they did again except for Tech stocks which only had a half-bad week. There is way too much crosscurrent info for the market to process and so it just gyrates like a bad state fair ride. It sure is nice for volatility though which I really like because it fuels the Katafin model. Through the ups and downs, the model returned 2% this week which is well about my goal of 1.5% and my observed performance to date of 1.6% for Katafin. Not to shabby but a far cry from…

Image Source; Flickr — Jerk Center by Studio Sarah Lou

I’m about halfway through The Man Who Solved The Market, a well-told story about Jim Simons, the founder of Renaissance Capital. Jim’s firm does ok in the market, returning an average of 66% annually in its Medallion Fund since 1988. That’s insane. Literally, insane. Heck, that is almost as good as Bitcoin since inception…As I have written in other posts, I’m fascinated by quant-modeled computer-driven trading that dominates the market today in terms of volume for a several reasons:

  1. Computer traders usually produce returns in excess of market averages.

We buy investments based on marketing. Many in the financial space would dispute this but marketing and media have always been at the core of an investment’s value. ‘Nobody ever got fired for choosing IBM’, is a well worn mantra for the relative security of buying IBM products and services that also reflects positively on its stock. Lately, that sentiment has changed as IBM has struggled to transition to the realities of corporate IT products and services and the rise of highly competent internal teams that don’t primarily rely on outside consultants. …

Image Source:

Like most forms of media, financial media is being disrupted, although at a much slower pace than others. Predictably, the incumbent media isn’t too happy about this and is actively deriding alternative forms as inferior to its experts and gurus. Like all media disruption, the net result is a scaling of choice for consumers which is good for them, but challenging for business models that rely on eyeball counts as a primary income stream. This isn’t new, there has been a virtual explosion of financial content thanks to platforms such as Medium, Seeking Alpha, Reddit and others.

WallStreetBets gets a…

Image Source: Flickr — What by Erich Ferdinand

I started Mark Manson’s literary tour de force, “The Subtle Art of Not Giving a Fuck” a couple of weeks ago, so I was uniquely prepared to assess the past week with the banana sauce of the markets this week. In my way of thinking, Manson is much like Aurelius, life happens, it’s how you deal with it that matters. The collective freakout from almost every part of financial media was tantamount to the Super Bowl for the financial news media. CNBC devolved into CNN/FOX mode with lots of blame-casting, some screaming and lots of smart people expertsplaining it to…

Image Source: Flickr —Mike Tyson’s Punch Out (NES) by Tyler C. Hellard

WallStreetBets Drops The Hammer On GME Shorts.

I’m trying to decide what was more exciting this week, watching UFC on Saturday or GME trading on Friday. More money definitely traded hands on GME. It was amazing to watch a functionally bankrupt retailer grow 50% in valuation on one day far exceeding its already stratospheric valuation. There are a whole bunch of weird things going on with GME that I don’t understand (and subsequently would never invest) but it is fascinating to watch. Furthermore, its educational to pay attention to what is happening to markets at the moment. WSB is part…

Image Source: Flicker: Unfurnished Apt for Rent by Turkeychik

Part of the Katafin model is identifying undervalued companies to add to the model. I use Macrotrends a free stock screening tool to find opportunities with the following criteria:

  1. Low P/E — between 10–20
  2. Track record of growing Return on Equity
  3. Low Debt

I usually sun a screen once a month and with find a group of 3–5 stocks to track after reading more about ones that make the list and considering their business with respect to the current environment. Last year I identified Rent-A-Center using this process.

The company had a 9% price to earnings ratio when I added…

In July of 2020, I sold my first options premium. A covered call on Ford for $4. Big time finance! I had built my first position with several acquisitions of Ford stock which had been beaten up pretty badly. I owned the stock at an average cost of $6.20 per share so my covered call represented a .64% return for the week. With that trade, I began a journey to understand if I could create a sustainable investment model that consisted solely of selling covered calls and later on, short puts.

Net Invested Capital — $140,260

Total Return: $1,337, .95%

This is the end, my only friend, the end. I have no idea why Morrison is running through my head as I’m writing this but I have thoroughly enjoyed the journey and learning something new by doing. I’ve gained a new skill which was actually one of my 2020 goals, who knew that Covid would actually benefit that objective? 2021 is the year that I finally buckle down and get Spanish mastered as a second language.

I ended the year with a $34,500 profit from the Katafin trading model. My first…

John Andrews

Mary Catherine’s Dad, Mary Shannon’s Husband, Duke Fan, Hiker, Collective Bias Co-Founder, Walmart Elevenmoms maker

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store