Week 834 Gold Option Write/Hedge (GOWH) Position & Performance Update

Sections in this report
1) Monthly, annual performance spreadsheet for weeks 1 through 832 offset positions
2) Current position week 833
3) Offset positions week 832
4) 2007-2022 weekly/annual performance on offset
5) Basics of how this program trades
6) What I like about this program
7) Video walking you through every trade for 2021
8) About automated trading accounts (ATAs)
* Previous weekly updates linked here
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1) Gold Option Write Hedge trade-by-trade spreadsheet weeks 1 through 834

2) Gold Option Write Hedge (GOWH) current position week 834

Market settlment price week 833 = $1,804.20.00 (February 2023 delivery)
Currently neutral gold, is in a clean defined uptrend we should be long
We’re writing one, week 5, 1835 in the money put to get long at +$34.20
Buying one, week 5, 1760 put to define maximum risk -3.10
Margin requirement & max risk
Put write 1835 – put purchase = $1,760 = $75.00
Max futures risk = $75.00 – net premium collected $31.10 = -$4,390 maximum risk
Margin = the minimum of the exchange margin requirement $6,930 or max rsk $4,390
Net collected after all costs on the week 5, 1835 put $3,420 = $3,380.87
Net premium paid after all costs on the week 5, 1760 put = -$349.13
At expiration if gold < $1,835 and > $1,760 we’ll be delivered gold long at $1,835
Barchart options quotes – CME options quotes

3) Position update week 833

Market settlment price week 832 = $1,800.20.00 (February 2023 delivery)
Currently neutral gold
Resting order to sell 1, week 4, 1780 put at $11.50 Unable
Purchased 1, week 4, 1760 put = -1.50 X 100 ounces = -$150.00
Margin requirement & max risk = 1780 put – 1760 put = $20.00 or -$2,000 per contract
Net collected/paid after all costs if our week 4, 1780 if the put is filled at $11.50 = $922
Net premium paid after all costs if our week 4, 1780 put sell is unable = -$189
Barchart options quotes – CME options quotes

4) Gold Option Write Hedge trade-by-trade spreadsheet weeks 1 through 834
__Performance on liquidated positions

Risk Disclosure

Gold Option Write Hedge is a hedge program for people who already own gold or want to own gold long-term and generate income against it while defining risk strategy on their underlying gold position. The performance represented is on realized profit or loss (offset positions), the open trade equity on underlying position is disclosed in section 2 of this report.

5) Basics of how this program trades

From neutral we write a slightly out of the money put option weekly collecting time premium, using a percentage of the collected premium buy a deeper out of the money put to define risk, (put credit spread) this procedure is repeated until we’re delivered a long futures position at a lower price.

Once delivered a long position we write a slightly out of the money call weekly collecting time premium, using a percentage of the call premium collected we buy an out of the money put to define risk, (collar) this procedure is repeated until the long futures position is called away at a higher price.

6) What I like about this program

- On the Majority of trades it collects weekly option income
- Risk is objectively defined on every trade
- You get paid to buy gold lower (put write entry), again to sell it higher (call write offset)
- Trading methodology is fully disclosed enabling performance verification.
- Very easy track, it trades once a week on Friday’ on or near the settlement
- Biggest downfall is weathering large open trade losses on the underlying futures positions.

7) Quotes & Charts