Tip From the Geek February Recap – Another Month of 25% ROI
Recapping The Geek’s February Binary Options Trading
February was a good month of trading for the Geek. The markets made sustained movements, in line with underlying fundamentals, and allowed me to make several additional trades above and beyond my usual weekly tips. February, being the short month that it is, and having started on Sunday, only had Mondays. That means only 20 tips, but with the extra signals I came up with 28 trades for the month. Out of those more than 2/3 were winners, 19 trades total. This is a 68% win rate and one of my better months. In fact, with this months wins and the profits I have made over the past three months my account has grown to a size that I can now increase my trade size. I not only can increase it, according to my money management rules I have to increase it because the growth has put my current trade size of $300 well below 3%.
Total Cost Of Trading = $8400
Total Return = $10,545
Net Profit = $2,125 or 25% ROI
I want to take this time to talk about position size and my need to raise the trade amount. My rules say to risk 3% per trade. This keeps my risk low and maintains a steady amount of profit. Now that my account value has risen $300 is does not equal 3% but what it really means is that my profits are too low. In terms of ROI there is no difference between trading 3% and 5% of my account, both result in a 25.5% return on the money spent. My account is sitting just under $17,000 at this time, 3% of that is $500 (rounded up). The difference between trading $300 and $500 is huge, $1,450, about 68% higher. With this in mind I think it is easy to see just how valuable following your money management can be.
Recap Of February Trading
February was a good month, the equity market bounced from long term support and was able to break out to new highs. This means that the long term bull market is still intact and a continuation of long term trends into the end of the year. At the same time shifting policy among the worlds central banks helped to extend the dollar rally and depress global currencies. Altogether I am pleased with my results, ecstatic to be raising my trade amount and already on track to have another decent month in March. So, 20 tips for the month but I missed 2 of my entries so I only made 18 tipped trades for winning percentage of 66.6%.
Week One 2/2/2015
The first week of February was a little nerve wracking. The US equity market was bouncing along the long term trend line but had not yet begun to rally. Earnings had also started and at that point earnings growth was in serious doubt. I traded the SPX in line with the trend, and the same with the USO, profiting from both. My trade on gold did not pan out, nor did a put on the Euro. I missed a trade this week, on Exxon, mostly because at the time I saw my entry prices had moved so far as to change my outlook.
Week Two 2/9/2015
This was my worst week of the month. I got into all five of my trades but only 2 of them profited. The SPX and USO continued to move in line with the trends, producing profitable trades, but central bank meetings caused forex markets to shift and I lost my trades on the EUR and JPY. Gold was also adversely affected by currency shifts and that trade failed as well. One of the factors undermining my trades was the Greece bail-out, without which my trades would likely have profited.
Week Three 2/16/2015
This is the week that the US markets broke out to new highs. It is also the week that earnings growth outlook for the fourth quarter began to pick up as well as the week in which Greece and the EU began to come to terms. And it is also the week my trading began to turn around, I got into all five of my trades and only lost one of them. My call on gold did not work but calls on the SPX and JPY did, as well as puts on the USO and EUR.
Week Four 2/24/2015
This is by far my best week of the month. I only got into four of my trades but the one I missed was only because the market moved to fast for me to get in, and I did not want to chase prices higher. The trade I missed…the SPX. It gapped up at the open that Monday and never retraced. The rest of my trades were easier to get into and all provided profits in the end.