Steady As She Goes

Disciplined options selling when volatility is high pays off

Hi Tortoise,

In this webinar, we’ll talk about:

• the impact of implied volatility contraction following earnings report;

• higher volatility related to DeepSeek, tariffs - pick your poison: volatility creates opportunity for our strategy;

• bi-weekly update of our portfolio performance. There’s still quite a bit of short-term premium to be earned over the next few weeks (0.7% premium return (vs. our current portfolio value) by February 21);

The goal remains unchanged: 8% annual returns, with below-average volatility, drawdowns, and relatively irrespective of the type of market environment we’re in.

Our 1-year stock replacement strategies earn their return very steadily, which means that one or two months after you’ve put these positions there could be some noise on your P&L. Indeed, that’s what we see today as our Substack and the Portfolio kicked off relatively recently. No change to the expected return outlook on that front, though.

As for the shorter-term setups, it’s pretty simple/boring: scaling positions when IV/VIX is high. Earning positive time value and reducing basis. Our transactions overview shows just that: consistency, discipline, and providing transparent insights into the risk we have on for constructing a solid portfolio.

We didn’t publish a research article this past week, as we’re busy analyzing earnings reports for the companies we cover on “The Compounding Tortoise”, including an upcoming deep dive on Ferrari (set to be released in March). We plan to push out an article on correlation as soon as possible.

We’ve attached our portfolio sheet below. The webinar, slides, and the transcript can be downloaded too.