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2022 Recap: The worst, the best, and the stories behind
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doctorpot1 joined discussion · Dec 21, 2022 09:06

The secret to happiness is low expectation, not expecting much in 2023, that's how I'm still happy and hitting goals in a bear market

TLDR: Didn't manage to get to level 100, but did manage to get 4 plays that returned more than 30% ROI. Getting a 30% ROI play in a bear market is way easier than getting to level 100 Reflecting on the lucky successes, it is found that those successful trade have solid hypothesis backed by macroeconomics factors, company fundementals, and legal framework. During the year, I had learnt a lot from both successes and failures, as well as learning how to better setup my portfolio to increase rewards while reducing risk. Hope that in 2023, I can finally achieve my 2022 goal of being a Level 100 sociable user that managed to hit a multi-bagger on a stocks or hit a 30% ROI options play.
The secret to happiness is low expectation, not expecting much in 2023, that's how I'm still happy and hitting goals in a bear market
Story time
1. What were your goals at the beginning of 2022? Have you achieved them yet?
At the beginning of the year, I had set out to try to be a Level 100 sociable user by posting useful contents, as well as trying to hit a multi-bagger on a stocks or hit a 30% ROI options play. Back then I was betting that one of these stocks $Futu Holdings Ltd(FUTU.US)$, $UP Fintech(TIGR.US)$, $DiDi Global Inc(DIDIY.US)$, $Palantir(PLTR.US)$, $Grab Holdings(GRAB.US)$ or $Warner Bros Discovery(WBD.US)$ will be the winner.
doctorpot1: Level 100 social user with a multi-bagger or 30% ROI play by 2022
1.1 Level 100 social user by posting useful contents
Sadly, I didn't reach level 100 by June 2022, not in December 2022, and probably won't be hitting it in June 2023 too Becoming level 100 is way harder than to find a multi-bagger or a 30% ROI play in this 2022 bear market I didn't expect the experience needed to level up scales exponentially. The experience points needed to go from Level 91 to Level 100, is the same as getting from Level 0 to Level 91
Respect to amazing mooers who have hit or even exceed level 100 like @Syuee
The secret to happiness is low expectation, not expecting much in 2023, that's how I'm still happy and hitting goals in a bear market
Even though I didn't reach level 100, I'm thankful to all my followers for following me, and to Moo Moo for supporting me Hopefully, I had been posting useful contents that is helpful to you though So I wouldn't have failed horribly. Do vote to let me know
1.2 A multi-bagger or 30% ROI play
Luckily, I had set out an easier trading goal. I was just hoping to get 1 multi-bagger OR 1 30% ROI options play. The 1 and the OR saved me Although most of my position is bleeding, I still manage to rake in some 30% ROI options play
The highest ROI winner is my position in $Geely 5xLongUB250930(56DW.SG)$ which is a 5x daily leveraged position on $GEELY AUTO(00175.HK)$ which I managed to get a 23.21% in 4 days, which mean it had an annualised ROI of 2117.91% I made this risky bet because it was during a period where Chinese stock are roaring.
These daily leveraged products are the best when there are continuous trend. This specific 5xLong DLC, will give us 5x daily compounded return on $GEELY AUTO(00175.HK)$. So if Geely rally continously for a few days, the returns will be more than 5x because of the compounding effect. But because it is a leveraged product, it means that I could lose a lot of money quickly too. Therefore, I did not put a lot of money on it, just $168 to play play
The secret to happiness is low expectation, not expecting much in 2023, that's how I'm still happy and hitting goals in a bear market
The second highest ROI play was when I "shorted" $Credit Suisse(CS.US)$ by buying a PUT option on it, because the words on the streets is that it may go bankrupt. So why not ride the trend right? However, shorting the stock is extremely dangerous as we could lose infinity money on it. But by buying PUT option instead, the payoff is similar to "shorting" the stock while capping the max loss.
If you are new to options do read this Explained Simply: Options 101 post first.
This "short" position gave me a ROI of 33% in 6 days which is an annualised ROI of 2007.50% For such short term "gambling" position, I did not put a lot of money too, just $60 for fun. It's just some 4D money hahaha
The secret to happiness is low expectation, not expecting much in 2023, that's how I'm still happy and hitting goals in a bear market
The next highest ROI position I had was in $Futu Holdings Ltd(FUTU.US)$. This position had netted USD$990.21 in premiums in 7 months with an average capital of USD$2797.60. This equates to an ROI of 35.39% in 7 months which is an annualised ROI of 62.40% Back then Futu, a.k.a Moo Moo, had crashed 88% from $204 to $25 driving the market cap of this amazing growth company's market cap to $3.67b market cap. EPS of FUTU in 2021 is HKD$18.43, so that is a PE of 10.6. Quite a no brainer right?
The secret to happiness is low expectation, not expecting much in 2023, that's how I'm still happy and hitting goals in a bear market
The last 30% ROI position I had was in $Twitter (Delisted)(TWTR.US)$ during the time it had a buyout backout saga with $Tesla(TSLA.US)$. I had put in USD$5,000 for this play as I had done intense research on the legal aspect of the case and determine that Twitter had a high chance for success.
Here are all my posts of due diligence listening to views from actual lawyers: Lawyer's take on the Twitter v Elon Musk case, and strategies to take position, Harvard Law Professor thinks it is likely that Musk will have to buy Twitter, Betting on certainty in the era of uncertainty, Elon to sell $9.2b worth of Tesla or none at all depends on the Twitter deal outcome and the purchase price, Elon said Twitter will help him cut short 3 to 5 years to achieve his vision for X.com, Musk sold $6.9b worth of Tesla because of Twitter case, Twitter has to hand over only 1 out of 22 employees' files on the bot issue that was requested by Elon, Elon's data scientist reported estimated bot count to be 5% to 11%, but he allegedly hid this data, Glad I got back in yesterday, Report says Elon is going to fulfil the $54.20 deal, Here is what is going to happen to your Twitter options. Look at the amount of due diligence just for 1 play.
For this saga I managed to net an ROI of 10.10% in 3 months which is an annualised ROI of 37.24% The good thing about this play is that not only was there a lot of research done to reduce the chance of failure, it was setup using an option play that also helped to reduce the chance of failure in case I was wrong. More about it in this post: Lawyer's take on the Twitter v Elon Musk case, and strategies to take position
The secret to happiness is low expectation, not expecting much in 2023, that's how I'm still happy and hitting goals in a bear market
1.3 Reflection of "lucky successes"
Looking back and reflecting on these great plays, there seems to be one thing in common and that is solid hypothesis with a great setup and proper capital allocation. The hypothesis are backed by macroeconomics factors (e.g. china opening up), company fundementals (PE of 10.6), and legal framework.
Reflecting on my biggest failures, they are plays with weak hypothesis such as "betting on the $Bed Bath & Beyond Inc(BBBY.US)$ apes" as mentioned in this post: Round 3 fired, betting that the extremist apes will HODL and twist facts, till we reach the moon. Luckily, I had reduce the risk I took by 60%, from risking USD$5,750 to just USD$2,350 as mentioned in this post: Now that bankruptcy is out of the picture for a while, it time to milk theta!! Currently, this position is having a loss of USD$1,000 which I have to slowly dig out of.
Will have to bring these learnings and experience forward to 2023, which could be even worse than 2022
2. Are your trading strategies on track? Have you learned something new?
Halfway through 2022, I realised that this bear market could last more than 2 years, thus I devised some strategies to use in this post: Strategies for a bear market which last on average 9.6 months, but this one may last more than 2 years. I had been stretching out my DCA using Cash Secured PUT option, as well as doing Covered CALL option to reduce my losses. This will help me to heal my bleeding red portfolio into a bruised blue black portfolio over time. For example, I had Turned a 44% loss into a 6% loss on Nio. Details in this post.
But not all position that used such strategy worked, For example, I had use the same strategy on $ContextLogic(WISH.US)$ and had once Turned a 37% loss into 44% gain in a bear market using covered calls. However, 6 months later, $ContextLogic(WISH.US)$ continued to crash by another 75%. So this 44% gain turned into a 41% loss, well now will have to bag-hold a lot longer than expected
2.2 Learning something new
In 2022, I had learnt that in stock market there are always better way to structure our portfolio to get higher returns and lower risk. One such approach is known as the Modern Portfolio Theory as explained in this post: Explained Simply: Modern Portfolio Theory, Optimising Risk and Reward of your portfolio. In the post, it was found that by considering $SPDR Gold ETF(GLD.US)$ and $Invesco QQQ Trust(QQQ.US)$ on top of $SPDR S&P 500 ETF(SPY.US)$, we can lower the risk or increase the returns or both. However, that method is using historical data and that may not be true in the future.
However, there are some more "guaranteed" ways to improve our portfolio which can be done by using tools such as options and Money Market Fund (MMF). For example, MMF like $CSOP USD Money Market Fund(SGXZ96797238.MF)$ and $Fullerton SGD Cash Fund(SG9999005961.MF)$ can be used hand in hand with Cash Secured PUT options, to increase the returns of the option position while lowering the risk by a tiny bit. As mentioned in this post: Money Market Funds is like a flexible T-Bill for investors, and "hack" for options.
The secret to happiness is low expectation, not expecting much in 2023, that's how I'm still happy and hitting goals in a bear market
It is like doing a combos like in street fighters game. And by coupling the combo with Moo Moo's generous fund coupons, I manage to rake in an additional $440.86 in 4 months.$287.04 in coupons, and the rest from putting money in MMF. That is how we can use new positions on top of current position to reduce risk and increase rewards.
3. How would you invest in 2023?
In 2023, I do believe that the market won't be good. Thus, I had been selling covered CALL that expires in 2024 on my existing position. I had send them to what I called an options hiberation mode, as mentioned it in this post: Sending my portfolio to "options hibernation mode" as the bear market rally ended. See you in 2024. Now that is what we call long-term investing... buy and leave it be I will be ignoring my existing position for 2023.
Even though I believe that it will still be a bad market in 2023, I will still be looking to add even more positions. This is because in every crisis there are always great opportunities. As interest rate goes up, S-REIT, dividend stocks and bonds price had been falling. The yield is now getting more and more attractive to me, so I'm looking out to add more into them in 2023. Then when interest rate starts to fall in 2024 and beyond, I would expect to see the stock price goes back up
On top of that, I believe that 2023 might be the year for Chinese stock rebound, so I'm looking at them too. Layering options trading on top of Chinese stock, I do hope that 2023 will be a good year too. Since I didn't fulfil all my goals in 2022, I'm just going to bring them over to 2023. Hopefully this time, I will finally be able to be a Level 100 sociable user that managed to hit a multi-bagger on a stocks or hit a 30% ROI options play.
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doctorpot1
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crawled out of poverty, working towards FIRE!! (financial independence, retired early)
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