That Was The Week, FTSE……Dropped. Silver….. Dropped!
So before we get into it, I was away attending the Investor Show courtesy of 
https://youtu.be/-xMKfO5R4wM?si=6tK0LMU83D6Y-hqj Hence the delay
Their Youtube channel has some great content and impressive interviews( not with me obviously). So some of the takeaways at the show: We learn Jim Mellon made 50% on his own portfolio last year, and he is good at spotting trends. He and other commentators actually talked up the UK while seeing the US as the sick man of the World. It’s no secret that US debt is out of control and simply managing interest at $1trillion a year is a heavy burden, the economy is not the stock market. Taiwan tech stocks got the thumbs up as did Uranium stocks (got that T shirt, and still sitting on a loss). UK household debt was the good news as it’s dropped substantially and is manageable. US households however are apparently in a right pickle, as they borrow to spend a lot more than our Greggs munching* proles!
Present at the show were the ICE.com, nice to be recognised by them, and also Saxo bank. While it is understood that strategies introduce complexities for the vendors, SAXO is still not offering strategies. The ICE.com however is doing new products https://www.ice.com/products/83049149 and https://www.ice.com/equity-derivatives/mini-equity-derivatives I believe these were mentioned here a while ago and may suit those nimble traders who don’t want the monthly journeys. We stick with the old school ways.
*I love a Greggs vegan sausage roll, me!
Sobering Thoughts
In a recent review of this blog by Gemini, we have an excellent win rate but it alluded to big losses. However it did not produce the goods in terms of any real horrors as we do look to manage risk and THAT is the point with any trading. This in turn, made me think about alternative investments like Gold and property. Gold bugs have had to wait decades to beat the market, and who knows where the next move is as it has come off by a chunk of change recently https://www.gold.co.uk/gold-price/30year/ounces/USD/ However the plight of investment property seems pretty grim as the law will force many out of the business and this is one area where you really cannot manage risk. One bad tenant can wipe out decades of rental income. The wheels of justice grind slowly, if at all.
In The Inbox
Not so much the emails this week but a lot of interesting content on Youtube:
https://youtu.be/ac4TtVSQKM0?si=nKigJjv4Q81SPwDC
https://www.youtube.com/@garyseconomics
The first link is American, the second one a home grown economist and former trader, though guessing where interest rates are going seems a rather curious way to trade. Not to be disparaging but if he was right and 90% were wrong, you have to question in what world this kind of trading even exists.
Distraction Trades
ADA was $0.2521 now $0.2526
XRP was $1.4346 now $1.4284 nothing to get excited or concerned about.
DAX : 2 losers 1 win minus 30 nett. Ouch!
UK Gilts Were £15.74 now £15.56 This is based on the Vanguard ETF. Not the cheeriest outlook, yields in the short term may be worth a look, apparently.
Silver: Using Wisdom Tree Physical Silver(PHAG) I had another go at $64.10 now it’s $68.93 it should have hit $100 according to the experts (this ETC does not mirror 1-for-1 but reflects the changes ) This is a pure punt. Still we get conflicting views with one bank claiming $300 an ounce by year’s end
Legacy Trades New Trade 463 A Tenfor
Trade 424 High Roller, This is a Trade Gone Wrong
PRECIS: We started from a July 2025 losing trade as below. Short calls are rarely a good idea.This is a ratio spread 8450/8650 calls
In summary we have an old trade from July 2025 which is a loss of 1741 against the credits taken in, of 422
Now 1539 big yawn but that’s the point. This will run until it’s no longer in a loss.
Trade 462 Calendar or Something Else?
What if we could buy a cheap Put spread and make something happen with that? We could use the one we own from Trade 461 This may be nuts but…. we SELL a June 10100 put for 80, giving us risk at 10,000. This exploits something we may not have done before, but we have a month’s protection at 10400 giving a full 100 so if things get spicy(and I really hope they will) there will be some interesting possibilities. We learn by doing and if we don’t break stuff we’re not trying hard enough!
https://optioncreator.com/stvdj8f
Have fun with this,I’m not even sure if this strategy has a name but the chances of profit look good, and theta is our friend. Remember if the market does drop to 10400, we will collect 100 from the long spread with which we can buy some excellent protection or close out.
I say again this is a curious journey but now the long Put spread is 217, 166.5= 50.5 and the June put is 146. DON’T PANIC!
Trade 463
I note we have only 19 days to expiry what’s to do? Let’s go for a 10-1 Moonshot. We are going squeaky clean with a Butterfly.
We buy the 10300 put for 127.5. Then, sell 2 of the 10150 puts 85.5. Our lower wing of the ‘fly is the 10000 put at 58.5. So this gives us 127.5+58.5 -(85.5×2)= 15
The ten to one is the fact that we are buying for 15 and the max is the difference between the upper and mid strikes which is of course 150. This is bulletproof as we can only lose our 15 premium. But, we’re certainly in the ball park to get something of a return. I want to err on the side of caution. I think for too long the market has ignored the crazy in the US.
Glossary:
There are two types of options: Puts, give you the right but not the obligation to sell the underlying. Calls give you the right, but not the obligation to buy the underlying.
When you sell those options, the opposite happens, with puts you get stock ‘put‘ to you at an unfavourable price (or not) and calls you get the stock you own taken, or ‘called’ away. If you don’t own the stock you need to stump up the cash, but in both cases with the FTSE index they are cash settled at £10 a point, so losses and gains are uncomplicated.
Please read the links below for a more comprehensive explanation in simple terms. Options are about mindset, only a modicum of intelligence required.
For those new to options:
https://optionsinvesting.co.uk/special-edition-how-options-work-1/
https://optionsinvesting.co.uk/special-edition-how-options-work-2/
https://optionsinvesting.co.uk/how-options-work-page-3/
Contact: surreyhantstraders@gmail.com.
If there is anything you’d like help with, we all started somewhere and yes, it can be baffling. There are no stupid questions, give it a whirl. (AI gets things wrong, remember)
All opinions expressed here are not to be taken too seriously and all of the trades are for educational purposes only.