San Jose Options is Celebrating 5 Consecutive Years of Successful Paper Case Studies.
These are the trades we share with our students from beginning to end. On this page you'll find some examples from our classes. Once you are a student of SJ Options, you can verify the validity of our statements in our recorded videos and by attending the Paper Case Study Classes.
February, 2013 Case Study - Front Ratio - PM Account
78 Day Return: +39%
Max Drawdown: 5%
This was another excellent paper case study that we did with our portfolio margin students. We began this trade before the holidays and didn't touch it over the break. With the market trending up so much, it at first had a little draw-down of over $1,000 because we set it up to be a bearish trade originally. But after we came back from our break in January, we made an adjustment on the trade and it made over $13,000 over the next few weeks. We are now in the process of closing it down with a very nice profit.
How Did We Do In 2012?
We Had Another Fantastic YearIn 2012 we added another mentor to our staff, David Heinzen. David took over the Big Condor paper case studies and his first one made 20%. Shortly after retiring the first trade, he began a second one that also finished the year with a profit.
Morris' Paper Case Studies finished up nearly $80,000 this year without using much buying power all year long since IV was so low. We saw very steady and consistent returns with the Ratio Spreads, both Front and Back.
Duane Teachout, the head of our mentoring department with over 26 years of retail trading experience, also led many successful case studies this year. He mainly focused on the Unbalanced Condor and Ratio Spreads. His student model account finished very positive on the year.
A Special CongratulationsOne of our mentors made nearly 50% in 2012 with real money. We're very proud of both our strategies and our mentoring team here at San Jose Options, Inc. We believe our course offers a very special and unique experience to its members. It's not often you'll find the rare combination of option strategies that perform being taught be real traders who use the strategies themselves.
At San Jose Options, Inc. you get to learn all the nuances of trading our strategies because we know them deeply from working with them ourselves in our real accounts. This allows us to deliver our content to you with thorough understanding so you know everything there is to know.
Stay tuned and check out some of our Paper Case Study results below that have been shared from beginning to end with the members of our community.
November, 2012 Case Study - UBC for IRA Accounts
45 Day Return: +3.5%
Max Drawdown: 0.5%
This was a very conservative trade called an Unbalanced Condor. We use this strategy quite often in our IRA paper case studies. What we like about this trade is the initial risk is very low, but we still have an opportunity to make up to 7% in a month's time. Obviously, it doesn't happen all the time. In this case we made about 3.5% somewhere between a month or two. The benefit to this trading technique is it's very simple to manage and much of the risk is removed when compared to other trading techniques.
July, 2012 Case Study - Big Condor for IRA & Standard Accounts
95 Day Return: +20%
Max Draw-down: 2%
At the end of July 2012 we started a Paper Case Study on the Big Condor from the Extended course. At the beginning of November we closed it out for a 20% profit. This was another excellent trade for those working with an IRA or Regulation T account.
June, 2012 Case Study - Back Ratio - PM Account
27 Day Return: +31%
Max Drawdown: 0%
This was a fantastic Back Ratio study. We conversed about how the relative Gamma is much higher OTM, and we put the theory to use in this spread design. It performed flawlessly and made 31% with only one adjustment made in the entire month even though the market was doing its proverbial whip-saw nearly the whole time - just a great trade! Congrats to all students who took this one!
May, 2012 Case Study - Back Ratio - PM Account
2 Day Return: +33%
Max Drawdown: 0%
This was a very successful Back Ratio study that we did live with our students. In class we determined that the market was possibly headed down since we noticed a Head and Shoulders Pattern forming on the RUT as well as on the RVX. We made a public post about this on our Facebook page at www.facebook.com/sanjoseoptions on May 9th, 2012.
In order to take advantage of the bearish forecast, we designed a Back Ratio spread in class that maximized safety and rewards at the same time. We could have made money in any direction, but we were looking for the drop in the market. Well, as forecasted, the market dropped about 8% over the following week, and our Back Ratio made $23,000 or about 30% in only 2 days!
So that being said, congratulations to all of our students who took the trade!
March, 2012 Case Study - THE BRIC™ - PM Account
Final Return: +42%
Max Return: +44%
Max Drawdown: 24% PM or Only 4% T-Margin
This was another successful trade using our Dual Vega strategy called the BRIC™. This was an interesting study since the market trended up the whole time we were in the trade.
Remember, using Portfolio Margin, we'll have greater returns and draw downs - the P/L is always magnified. We got off to a slow start on this trade and started in the hole with about a 24% draw-down using a Portfolio Margin Account (about 4% in a T-Margin Account). Most of this was caused because we missed an adjustment and only look at these trades once per week. The good news is that this was just a bump in the road...
The spread prevailed and became yet another very profitable trade for us. We've already made over 120% with this strategy in only 3 trades which took about 5 months to do. We're loving the SJ Options strategies. They get better and better every year.
March, 2012 Case Study - THE BRIC™ - IRA Account
Final Return: +21%
Max Return: +21%
Max Drawdown: 0%
Here is a snapshot of our IRA BRIC™ as it's winding down to expiration. Notice that the trade is up 21% (middle row), but if the market moves up or down 10%, then the trade is still safe and very profitable. This can be seen in the P/L row where you see $106K, $10K and $8K. This is a great example of the low risk strategies we use here at San Jose Options, Inc.
Once again, another great trade presented and followed each week in our course. Congrats to all the student who followed along with this case study!
January, 2012 Case Study - THE BRIC™
Final Return: +55%
Max Return: +60%
Max Drawdown: 0%
We've just completed one of our case studies on the BRIC™ which is another SJ Options original formula with Dual Vega. We've been studying this strategy since the fall of 2011, and so far it hasn't put on a single losing performance. What we love about this strategy is that it truly follows the SJ Options methodology of Max Safety, Max Reward option trading. The BRIC™ is a strategy that breezes through the proverbial whip-saw markets, and yet, it also yields a very handsome return when the markets are calm.
Although this strategy has produced us very high returns (Up to 40% in a month with PM and 12% in a month in an IRA), the BRIC™ encompasses the two required criteria of all SJ Options' trades - number one is safety and number two is that it can make money in any direction.
The trade finished entirely above the zero line, and we still had a chance to make more on it. This is the kind of strategy that all option traders need to learn.
We'll continue our work on this strategy in our live classes, but so far, we are extremely pleased with its performance. The feedback we are getting from the students has all been very positive.
The BRIC™ is the epitome of the SJ Options Mentoring Course, and it's definitely a strategy that everyone can employ since it doesn't require much capital to work with.
2011 Futures Options Account
Yearly Return: +105%
Beginning Balance: $100,000
Ending Balance: $205,006
As our Paper Case Studies progressed in 2011, we noticed some very attractive characteristics in trading the futures markets with options. Although futures can be very volatile, we find that they match up very well with the architecture of our strategies. In less than 8 months we had some fantastic returns. We look forward to furthering our success in this arena, and we are really excited to bring this knowledge to those who have been looking for a way to diversify their portfolios from the volatile equity markets.
As we like to say, "The Future looks bright with Futures!" here at San Jose Options, Inc.
2011 Portfolio Margin Account
Yearly Return: +48%
Beginning Balance: $196,588
Ending Balance: $291,555
We've traded through another historical year in the stock market. 2011 proved to be very difficult for most option traders with the equity market dropping nearly 25% in about a month's time. During the summer's major debacle, we saw a temporary draw-down on our Negative Vega case studies while the Positive Vega trades sky-rocketed into profits. Just as planned, we battled through the volatility as well as the proverbial whip-saw market using our original strategies designed around the concept of "safety first." Now, as the year has come to an end, we have once again put up very handsome numbers in the P and L department. We are extremely happy with the performance of our strategies in 2011 and look forward to a bright 2012.
Yearly Return: 48%
Beginning Balance: $132,902
Ending Balance: $196,588
2010 was the year of the "Flash Crash." It proved to be a very trying year for every option trader in the world. For us it was a blessing in disguise. On that dreadful day of May 6th our account faced a 2.5% draw-down, which may not seem like much, but we had just started using a Portfolio Margin Account, so we had over $2,000,000 invested. Needless to say, we saw a short term draw-down of about $50,000 in our account. The good news is that our strategy held up. Just a few weeks later our account had fully recovered and we still finished the year up 48%. We looked around the internet and noticed the majority of option traders lost from 40 to 70% of their entire accounts that day.
Since the "Flash Crash" we have designed the RAS trading system even further, and at this point, we welcome another one with open arms. Our current system makes an astounding return over such situation in the TOS back tester, and we are ready to face another one. So bring it on.
Yearly Return: 42%
Beginning Balance: $95,000
Ending Balance: $130,024
In 2009 we began to take our strategies and make them more conservative. We began using less Condors, Butterflies and Calendars because we saw too much embedded risk in those trades. Our efforts to create less risky trades gave us a more steady equity curve throughout the year. Although our return wasn't as high as in 2008, our portfolio was much better protected against debacles that could occur at any time, such as what happened in 2010. We didn't use PM this year. This was a standard margin account.
In case you are wondering why we didn't start 2009 with $170,000, it's because we reset our account to $100,000 in December of 2008 by accident and had a little draw-down before the year started.
Yearly Return: 70%
Beginning Balance: $100,000
Ending Balance: $170,011
2008 was a fantastic year for us. Our strategies proved to work well over the bearish market we faced at the end of the year. This was the first year of our mentoring, and we were using more aggressive strategies back then, thus the higher return. Although we had a great year, looking back it was also riskier, and some of those strategies we were using do not fall in line with our current trading style. The videos are still in our archives if you would like to see what we did, but that style of trading would not survive a "Flash Crash." Fortunately, in 2008 we didn't have a computer glitch, but rather an easily forecasted bearish market which is why are strategies held up so well that year. 2008 was before we invented the RAS, and we made this return without having a Portfolio Margin account.