No Lose Stocks / Options Trading 2016 Option Expiration Review

I don’t sell access to this investing service on this site anymore, but I still trade the recommendations. Since I have all of my previous reviews here, this seems like a good place to keep posting them.

For some background, I don’t count a trade as a winner/loser until it’s sold, or expires. So I gauge the returns of my system based on all the trades that expire on the same expiration date. So my reporting lags about 2 years, meaning I currently have trades in my portfolio that will expire in 2018. I won’t know until then how well I’m doing now.

Here’s the review of the January 2015 expiration trades.

OPTIONS PURCHASED TO OPEN TRADE

Contract $/Contract Buy Date
T Jan 15 2016 45.00 Call $0.57 9/20/2013
PPL Jan 15 2016 45.00 Call $0.15 10/1/2013
LLY Jan 15 2016 70.00 Call $0.76 10/1/2013
JNJ Jan 15 2016 115.00 Call $1.18 10/4/2013
INTC Jan 15 2016 35.00 Call $0.43 10/4/2013
DD Jan 15 2016 85.00 Call $0.78 10/16/2013
MW Jan 15 2016 65.00 Call $0.40 10/31/2013
KO Jan 15 2016 55.00 Call $0.50 11/4/2013
VZ Jan 15 2016 70.00 Call $0.69 11/4/2013
PPL Jan 15 2016 35.00 Call $0.65 11/6/2013
MCD Jan 15 2016 130.00 Call $0.67 11/12/2013
KRFT Jan 15 2016 75.00 Call $0.54 11/12/2013
MW Jan 15 2016 60.00 Call $0.49 11/12/2013
K Jan 15 2016 95.00 Call $0.14 11/12/2013
GE Jan 15 2016 40.00 Call $0.25 11/14/2013
WMT Jan 15 2016 115.00 Call $0.27 11/15/2013
FE Jan 15 2016 50.00 Call $0.35 11/21/2013
MO Jan 15 2016 50.00 Call $0.24 11/25/2013
CSCO Jan 15 2016 32.00 Call $0.40 11/26/2013
GIS Jan 15 2016 70.00 Call $0.57 12/6/2013
KMP Jan 15 2016 105.00 Call $0.31 12/16/2013
PFE Jan 15 2016 45.00 Call $0.41 12/23/2013
WM Jan 15 2016 60.00 Call $0.40 1/3/2014
EMR Jan 15 2016 100.00 Call $0.75 1/3/2014
POT Jan 15 2016 47.00 Call $0.95 1/6/2014
ETP Jan 15 2016 75.00 Call $0.40 1/8/2014
AFL Jan 15 2016 95.00 Call $0.67 1/9/2014
TGT Jan 15 2016 85.00 Call $0.56 1/24/2014
TWC Jan 15 2016 165.00 Call $0.50 1/29/2014
KMI Jan 15 2016 50.00 Call $0.26 2/10/2014
PG Jan 15 2016 110.00 Call $0.55 2/13/2014
HD Jan 15 2016 110.00 Call $0.91 2/20/2014
NYCB Jan 15 2016 22.00 Call $0.15 2/20/2014
SWY Jan 15 2016 47.00 Call $0.36 3/6/2014
ETR Jan 15 2016 80.00 Call $0.60 3/6/2014
MAT Jan 15 2016 55.00 Call $0.45 3/11/2014
DUK Jan 15 2016 90.00 Call $0.55 3/14/2014
HON Jan 15 2016 130.00 Call $0.98 3/20/2014
JPM Jan 15 2016 85.00 Call $0.66 3/27/2014
MRK Jan 15 2016 80.00 Call $0.60 3/31/2014
MMM Jan 15 2016 195.00 Call $0.75 4/1/2014
UTX Jan 15 2016 165.00 Call $0.76 4/11/2014
TRV Jan 15 2016 120.00 Call $0.60 4/29/2014
WFC Jan 15 2016 70.00 Call $0.37 5/8/2014
CVX Jan 15 2016 170.00 Call $0.35 5/19/2014
AEP Jan 15 2016 65.00 Call $0.40 5/21/2014
UNP Jan 15 2016 140.00 Call $0.73 6/13/2014
CAG Jan 15 2016 40.00 Call $0.16 6/20/2014
COP Jan 15 2016 110.00 Call $0.70 6/25/2014
USB Jan 15 2016 55.00 Call $0.38 7/18/2014
KMB Jan 15 2016 145.00 Call $0.70 7/22/2014
CL Jan 15 2016 80.00 Call $0.66 8/1/2014
CLX Jan 15 2016 110.00 Call $0.51 8/5/2014
BHP Jan 15 2016 90.00 Call $0.77 9/4/2014
BAX Jan 15 2016 95.00 Call $0.48 9/9/2014
LO Jan 15 2016 75.00 Call $0.67 10/7/2014
PEP Jan 15 2016 120.00 Call $0.73 12/26/2014

OPTIONS SOLD TO CLOSE TRADE

Contract $/Contract Sell Date
PPL Jan 15 2016 35.00 Call $1.45 5/30/2014
ETR Jan 15 2016 80.00 Call $4.80 6/19/2014
INTC Jan 15 2016 35.00 Call $3.57 8/21/2014
MO Jan 15 2016 50.00 Call $2.79 11/10/2014
LLY Jan 15 2016 70.00 Call $4.80 12/2/2014
KMI2 Jan 15 2016 105.00 Call $5.58 12/29/2014
CLX Jan 15 2016 110.00 Call $5.40 1/22/2015
AEP Jan 15 2016 65.00 Call $3.30 1/28/2015
HD Jan 15 2016 110.00 Call $9.15 2/11/2015
KRFT Jan 15 2016 75.00 Call $7.70 3/25/2015
TWC Jan 15 2016 165.00 Call $10.70 5/20/2015
MW Jan 15 2016 60.00 Call $4.80 6/3/2015
CAG Jan 15 2016 40.00 Call $3.90 6/19/2015
MW Jan 15 2016 65.00 Call $4.90 6/22/2015
TGT Jan 15 2016 85.00 Call $4.10 6/23/2015
BAX1 Jan 15 2016 95.00 Call $0.01 12/21/2015
KMB1 Jan 15 2016 145.00 Call $0.01 12/21/2015
RAI1 Jan 15 2016 75.00 Call $1.76 12/21/2015
MCD Jan 15 2016 130.00 Call $0.01 12/21/2015
TRV Jan 15 2016 120.00 Call $0.02 12/21/2015
DD1 Jan 15 2016 85.00 Call $0.01 12/21/2015

Summary

I purchased 57 options in the period from September 20, 2013 through December 26, 2014.

I sold 15 options when the underlying stock reached its strike price before the January 2016 expiration date.

I also sold 6 other options on December 21, 2015 that were worth some small amounts, but would not very likely hit their strike prices before the January 15, 2016 expiration date. I made a mistake when doing this. I entered the trades when the market was closed and chose to “sell at market”. Since some of these were thinly traded and didn’t have any “bids”, they sold for pennies per contract. I probably lost about $200 in value due to that mistake, so not a crazy amount, but enough to help me remember the lesson.

That leaves 36 trades that expired worthless.

I purchased to open $3077/contract in trades, with $5 * 57 = $285 in commissions, (I’m estimating $5 per trade), for a total of $3362/contract paid out.

I sold to close $7876/contract, with $5 * 21 = $105 in commissions for a total of $7771/contract in deposits.

That means my return from September 20, 2013 through January 2016 was ($7771 – $3362)/$3362 = 131%…or roughly 66% per year.

Also note that by 1/28/2015, the winning trades had already paid for all of the trades I would place in this group. Any trades that paid off in the year after that were pure profit.

It’s okay to be wrong…what matters is the magnitude of the times you are right, and the minimizing of the pain from the times you are wrong.

Note the opposite could also happen…being right 99% of the time, but those 1% wrong times could wipe you out.

Smile Watcher

Smile!

Making yourself smile can make you a happier person. There is also evidence that people who smile more are healthier and live longer.

And, according to Tony Robbins, there was a study done at UC Berkeley that showed that smiling for 20 minutes for 20 days could help clinically depressed people get off their meds and not be depressed.

So I created a tool to help me practice smiling while I work.

The tool uses your computer’s webcam and watches your face. It takes a picture every 3 seconds and checks if you are smiling or not. If you are smiling (80% happy or more), then the screen turns green. But if you stop smiling (less than 80% happy), then the screen will turn red. Any time the screen changes from red to green, or green to red, the computer will beep.

The tool has only been tested on the Google Chrome web browser, and may not work on other browsers. If your webcam doesn’t turn on when you click Start, then the tool won’t work on your browser.

How To Use The Tool

– In Chrome browser, go here: https://jsfiddle.net/7ja0t0bo/10/

– Click the “Start” button circled in red in the screen shot below

– It will ask for access to the camera on your computer.

– Grant access (assuming you don’t object…the pictures and video are not stored any where and no one except you will see them)

– Smile. : )

– Every 3 seconds it will take a snapshot and then tell you how happy it thinks you are (among other emotions it grades for). If you are 80%+ happy, the screen will show green and “beep”. If you become less than 80%+ happy it will turn red and “beep” again. It “beeps” any time there is a change in “80%+ happy”, either lower or higher.

smilewatcher

For Technologists

This tool uses Microsoft’s Emotion API, which is part of their Cognitive Services APIs.

The APIs allow you to create services that rely on vision, speech, language, knowledge, and search.

The code for this smile watching tool is hosted by a service called JSFiddle. Programmers use this service to share examples of code with each other.

Feel free to play with the code and change it however you like. You won’t mess it up for anyone else. If you click “Update”, it will give you a new URL with your changes. If you save or bookmark that URL, you can come back to your changes later. And you can share your URL with your changes with other people if you want.

For example, maybe you find an 80% smile to be too much smiling and would prefer a 50% smile. Find the line that looks for 80% smiling and change it to 50%. (Hint: it’s going to have “> 80”, which you would change to “> 50”, and then click “Run”, and then click “Start”.)

Happy smiling!

Think And Grow Rich – Chapter 15: How to Outwit the Six Ghosts of Fear

Finishing my analysis of Think and Grow Rich.

This is for Chapter 15, How to Outwit the Six Ghosts of Fear

(Go here to start from the beginning.)

Quote and Analysis

“Take Inventory of Yourself, As You Read This Closing Chapter, and Find Out How Many of the “Ghosts” Are Standing in Your Way. BEFORE you can put any portion of this philosophy into successful use, your mind must be prepared to receive it.”

The interesting thing here is that this chapter is the last chapter of the book, but to use the rest of the book, I have to first use this chapter to identify my fears and prepare myself to receive the philosophy.

Quote and Analysis

“The preparation is not difficult. It begins with study, analysis, and understanding of three enemies which you shall have to clear out.

These are INDECISION, DOUBT, and FEAR!

The Sixth Sense will never function while these three negatives, or any of them remain in your mind. The members of this unholy trio are closely related; where one is found, the other two are close at hand.”

The entire purpose of this book is to bring me to where I have access to the Sixth Sense: knowledge that comes to me through my imagination in order to tell me how to be successful at my endeavors.

So, if I am indecisive, doubtful, or fearful about anything, then I will close down, and I won’t have access to this knowledge.

Quote and Analysis

“INDECISION is the seedling of FEAR! Remember this, as you read. Indecision crystallizes into DOUBT, the two blend and become FEAR! The “blending” process often is slow. This is one reason why these three enemies are so dangerous. They germinate and grow without their presence being observed.”

So, as long as I can avoid indecision, I will short-circuit the creation of doubt, and that short-circuits the generation of fear.

Note that indecision also leads to inaction. “I’m not sure what to do, so I’ll wait for more information (and do nothing in the meantime).”

Thus one of the ways I can stomp out fear is to keep moving, and not to allow myself to get stuck. I can try something. If it doesn’t work, I can try something else.

Quote and Analysis

“THE SIX BASIC FEARS

There are six basic fears, with some combination of which every human suffers at one time or another. Most people are fortunate if they do not suffer from the entire six. Named in the order of their most common appearance, they are:

The fear of POVERTY

The fear of CRITICISM } most of one’s

The fear of ILL HEALTH } worries

The fear of LOSS OF LOVE OF SOMEONE

The fear of OLD AGE

The fear of DEATH

All other fears are of minor importance, they can be grouped under these six headings.”

I’m listing these here for reference.

Kind of interesting that he says they are listed in order of their most common appearance. In the list, all of the fears are above the fear of Death, meaning that Death is the least feared.

I’ve heard it said before that most people fear Death LESS than they fear Public Speaking (which would be a manifestation of a fear of Criticism). If that’s you, and you’d like to be able to master your fear of Criticism, consider trying out Toastmasters.

I used to DREAD public speaking, but after participating in Toastmasters for a few months, I lost that fear. And now, after a few years of participating, I actually enjoy public speaking. It’s a very supportive and growth-oriented environment.

Quote and Analysis

“We are here laying the foundation for the presentation of a fact of great importance to the person who does not understand why some people appear to be “lucky” while others of equal or greater ability, training, experience, and brain capacity, seem destined to ride with misfortune. This fact may be explained by the statement that every human being has the ability to completely control his own mind, and with this control, obviously, every person may open his mind to the tramp thought impulses which are being released by other brains, or close the doors tightly and admit only thought impulses of his own choice.

Nature has endowed man with absolute control over but one thing, and that is THOUGHT. This fact, coupled with the additional fact that everything which man creates, begins in the form of a thought, leads one very near to the principle by which FEAR may be mastered.

If it is true that ALL THOUGHT HAS A TENDENCY TO CLOTHE ITSELF IN ITS PHYSICAL EQUIVALENT (and this is true, beyond any reasonable room for doubt), it is equally true that thought impulses of fear and poverty cannot be translated into terms of courage and financial gain.”

Whatever the mind of man can conceive and believe, the mind of man can achieve. That’s the “secret”. This section is saying exactly that, in the negative sense. If I conceive that I could fail. And then believe that I could fail. Then I will fail.

On the other hand, if I conceive that I will succeed, and then believe that I will succeed, then I will succeed.

He’s saying success has nothing to do with ability, training, experience, or brain capacity. These are all things that I generally assume are needed, and that I must build up first before I can achieve some particular desire. But it turns out I don’t need any of those. I only need to keep thoughts that are negative out of my mind, and then create and support in my mind thoughts that are positive. I only need to control my thoughts, and thus create a positive State of Mind, which is directly opposed to a fearful State of Mind. So this chapter is meant to help me remove the possibility of a fearful State of Mind, so that I can then create a positive State of Mind, and receive insights from the Sixth Sense.

Quote and Analysis

“Fear of poverty is a state of mind, nothing else! But it is sufficient to destroy one’s chances of achievement in any undertaking, a truth which became painfully evident during the depression.

This fear paralyzes the faculty of reason, destroys the faculty of imagination, kills off self-reliance, undermines enthusiasm, discourages initiative, leads to uncertainty of purpose, encourages procrastination, wipes out enthusiasm and makes self-control an impossibility. It takes the charm from one’s personality, destroys the possibility of accurate thinking, diverts concentration of effort, it masters persistence, turns the will-power into nothingness, destroys ambition, beclouds the memory and invites failure in every conceivable form; it kills love and assassinates the finer emotions of the heart, discourages friendship and invites disaster in a hundred forms, leads to sleeplessness, misery and unhappiness-and all this despite the obvious truth that we live in a world of over-abundance of everything the heart could desire, with nothing standing between us and our desires, excepting lack of a definite purpose.

The Fear of Poverty is, without doubt, the most destructive of the six basic fears. It has been placed at the head of the list, because it is the most difficult to master. Considerable courage is required to state the truth about the origin of this fear, and still greater courage to accept the truth after it has been stated. The fear of poverty grew out of man’s inherited tendency to PREY UPON HIS FELLOW MAN ECONOMICALLY. Nearly all animals lower than man are motivated by instinct, but their capacity to “think” is limited, therefore, they prey upon one another physically. Man, with his superior sense of intuition, with the capacity to think and to reason, does not eat his fellowman bodily, he gets more satisfaction out of “eating” him FINANCIALLY. Man is so avaricious that every conceivable law has been passed to safeguard him from his fellowman.”

I wasn’t sure what the “Fear of Poverty” was until I read this part. The “Fear of Poverty” is a “scarcity mindset”. It’s the belief that there isn’t enough to go around, so I need to hoard or take from someone else. It is the belief that there is NOT an over-abundance of everything that I or anyone could want. It’s the belief that I need to grab my share, rather than the belief that I can create a greater share for myself and everyone if I want.

Quote and Analysis

“Self-analysis may disclose weaknesses which one does not like to acknowledge. This form of examination is essential to all who demand of Life more than mediocrity and poverty. Remember, as you check yourself point by point, that you are both the court and the jury, the prosecuting attorney and the attorney for the defense, and that you are the plaintiff and the defendant, also, that you are on trial. Face the facts squarely. Ask yourself definite questions and demand direct replies. When the examination is over, you will know more about yourself. If you do not feel that you can be an impartial judge in this self-examination, call upon someone who knows you well to serve as judge while you cross-examine yourself. You are after the truth. Get it, no matter at what cost even though it may temporarily embarrass you!”

This is hard to do. I think it almost has to be done with someone else. When I do it by myself, I’m able WITHOUT EVEN NOTICING to skip the ones that are really important to me. The questions that hold the key to what is holding me back the most. Writing down my answers is an important piece of the process because it requires clear thinking, honesty, and completeness.

If I don’t write it down, then I can kind of fudge in my mind and skip over it without actually thinking through the answer.

One other thing that tends to focus my thinking is to require that I write down a specific example of a time I did the positive or negative side of the question. A specific example is one that I could put a date to. Not something general.

If I do this, then I can start to root out these fears and switch to a positive State of Mind…even if I thought I was already in a positive State of Mind.

Quote and Analysis

“The greatest of all remedies for the fear of death is a BURNING DESIRE FOR ACHIEVEMENT, backed by useful service to others. A busy person seldom has time to think about dying. He finds life too thrilling to worry about death.”

Note that one remedy for a fear of death is SERVICE TO OTHERS.

Quote and Analysis

“This fear is useless. Death will come, no matter what anyone may think about it. Accept it as a necessity, and pass the thought out of your mind. It must be a, necessity, or it would not come to all. Perhaps it is not as bad as it has been pictured.”

Interestingly, I think this might be a limiting belief in the author’s mind. It cannot be that “death will come, no matter what anyone may think about it” and that “whatever the mind of man can conceive and believe, the mind of man can achieve”. Both cannot be true.

It should be just as effective to remove the fear of death to believe that death will never come, as it is to accept and believe that death will always come. The “trick” is to believe whichever way I choose, and not to doubt. I must make a decision one way or the other, but I can’t sit in the middle and worry.

Quote and Analysis

“Decision can also prevent one’s acceptance of undesired circumstances. The six basic fears become translated into a state of worry, through indecision. Relieve yourself, forever of the fear of death, by reaching a decision to accept death as an inescapable event. Whip the fear of poverty by reaching a decision to get along with whatever wealth you can accumulate WITHOUT WORRY. Put your foot upon the neck of the fear of criticism by reaching a decision NOT TO WORRY about what other people think, do, or say. Eliminate the fear of old age by reaching a decision to accept it, not as a handicap, but as a great blessing which carries with it wisdom, self-control, and understanding not known to youth.

Acquit yourself of the fear of ill health by the decision to forget symptoms. Master the fear of loss of love by reaching a decision to get along without love, if that is necessary.”

These are decisions I can make, beliefs I can decide to believe, to eliminate these fears.

Quote and Analysis

“The release of destructive thought impulses, alone, without the aid of words, produces also a “kickback” in more ways than one. First of all, and perhaps most important to be remembered, the person who releases thoughts of a destructive nature, must suffer damage through the breaking down of the faculty of creative imagination.

Secondly, the presence in the mind of any destructive emotion develops a negative personality which repels people, and often converts them into antagonists. The third source of damage to the person who entertains or releases negative thoughts, lies in this significant fact -these thought-impulses are not only damaging to others, but they IMBED THEMSELVES IN THE SUBCONSCIOUS MIND OF THE PERSON RELEASING THEM, and there become a part of his character.”

So, if I think “negative” thoughts, thoughts that support the 6 basic fears, thoughts of lack, or worry, then I am damaging myself in these 3 ways.

I am damaging my connection to the thing that is going to make me successful, my creative imagination, my connection to the Sixth Sense.

I am damaging myself by creating a negative personality that will make others want to work against my desires instead of for them.

I am damaging myself by training my mind to think these thoughts as a matter of habit and thus become my character.

Quote and Analysis

“In addition to the Six Basic Fears, there is another evil by which people suffer. It constitutes a rich soil in which the seeds of failure grow abundantly. It is so subtle that its presence often is not detected. This affliction cannot properly be classed as a fear. IT IS MORE DEEPLY SEATED AND MORE OFTEN FATAL THAN ALL OF THE SIX FEARS. For want of a better name, let us call this evil SUSCEPTIBILITY TO NEGATIVE INFLUENCES.

Men who accumulate great riches always protect themselves against this evil! The poverty stricken never do! Those who succeed in any calling must prepare their minds to resist the evil. If you are reading this philosophy for the purpose of accumulating riches, you should examine yourself very carefully, to determine whether you are susceptible to negative influences. If you neglect this self-analysis, you will forfeit your right to attain the object of your desires.

Make the analysis searching. After you read the questions prepared for this self-analysis, hold yourself to a strict accounting in your answers. Go at the task as carefully as you would search for any other enemy you knew to be awaiting you in ambush and deal with your own faults as you would with a more tangible enemy. You can easily protect yourself against highway robbers, because the law provides organized cooperation for your benefit, but the “seventh basic evil” is more difficult to master, because it strikes when you are not aware of its presence, when you are asleep, and while you are awake. Moreover, its weapon is intangible, because it consists of merely-a STATE OF MIND. This evil is also dangerous because it strikes in as many different forms as there are human experiences. Sometimes it enters the mind through the well-meant words of one’s own relatives. At other times, it bores from within, through one’s own mental attitude. Always it is as deadly as poison, even though it may not kill as quickly.”

In particular, I want to note here that he’s saying this “susceptibility to negative influences” is MORE often fatal than all of the six fears. So even if I root out all of the six fears, I still need to deal with this.

And the way that I can do this is by using the self-analysis questions in the book. I know for myself, that I have to write down my answers, and try to think of specific examples, dates/times, of when I did the positive side of the question. If I can’t think of examples that specific, and I can’t write them down, then I have found one of the hiding places of my enemy, and one of the chief obstacles to my positive state of mind.

Quote and Analysis

“Recognize that you are, by nature, susceptible to all the six basic fears, and set up habits for the purpose of counteracting all these fears.”

The habits he’s talking about are sprinkled through the book. The habit of reading my DCA in the morning and in the evening is an example of these habits.

Other habits that I have are avoiding news in all forms…newspaper, TV, radio, internet, twitter, etc.

Quote and Analysis

“Recognize that negative influences often work on you through your subconscious mind, therefore they are difficult to detect, and keep your mind closed against all people who depress or discourage you in any way.”

Keeping my mind closed against all people who depress or discourage me could mean that I avoid these people, but it doesn’t have to mean that. Sometimes I can’t avoid them. So it means that I need to put anything they say in a different light. I need to view their statements as fiction or as a viewpoint that is coming from false information.

I can try to influence them and show them my own viewpoint and the more positive perspective, and often this works and they brighten. But sometimes it doesn’t and they choose to stay in their negative state of mind. That’s fine as long as I don’t allow them to affect my positive state of mind.

Quote and Analysis

“Deliberately seek the company of people who influence you to

THINK AND ACT FOR YOURSELF.”

So, I don’t have to ignore ALL external influences. I can allow in the positive ones, the ones that support my beliefs. I just have to reject the negative ones.

My Master Mind group has been a great source of this kind of influence.

Quote and Analysis

“To aid those who wish to see themselves as they really are, the following list of questions has been prepared. Read the questions and state your answers aloud, so you can hear your own voice. This will make it easier for you to be truthful with yourself.”

As I said above, I find it even more useful to write the answers down instead of just stating them aloud.

Quote and Analysis

“How much time have you devoted to studying and answering these questions? (At least one day is necessary for the analysis and the answering of the entire list.)”

Here’s a helpful reminder of how long this kind of deep introspection should really take. It’s not going to be something I can just zip through in a few minutes. I need to seriously consider each question and make sure that I’m not skipping over the hiding place of a weakness.

Quote and Analysis

“Study the questions carefully, come back to them once each week for several months, and be astounded at the amount of additional knowledge of great value to yourself, you will have gained by the simple method of answering the questions truthfully. If you are not certain concerning the answers to some of the questions, seek the counsel of those who know you well, especially those who have no motive in flattering you, and see yourself through their eyes. The experience will be astonishing.”

I need to come back to these questions once a week for several months. So, I need to spend a full day, once a week for at least 3 months…or approximately 12 times of going through this full list of questions and answering each one specifically.

And I need to seek the perspective of others. I don’t have to adopt their viewpoints, but it would be helpful to see if there is a perspective that I am missing by a habit of not looking in that direction.

Quote and Analysis

“Mind control is the result of self-discipline and habit. You either control your mind or it controls you. There is no hall-way compromise. The most practical of all methods for controlling the mind is the habit of keeping it busy with a definite purpose, backed by a definite plan.”

Again, the importance of habit is being affirmed. I can control my mind or let it control me. And the way I can control it is to keep it busy with my DCA and a plan to achieve that DCA. Even if that plan needs to change in the future, making a decision and taking action toward the plan is the key to stomping out fears.

Quote and Analysis

“Remember, too, the philosophy presented in this book makes every one of these alibis obsolete.”

So, even if I find my particular pet belief in the list, I don’t get to believe that I’m stuck. The philosophy of stomping out my fears, locking in a positive state of mind, and following the 13 principles will lead me to my success.

Quote and Analysis

“The Master Key is intangible, but it is powerful! It is the privilege of creating, in your own mind, a BURNING DESIRE for a definite form of riches. There is no penalty for the use of the Key, but there is a price you must pay if you do not use it. The price is FAILURE. There is a reward of stupendous proportions if you put the Key to use. It is the satisfaction that comes to all who conquer self and force Life to pay whatever is asked.”

In the end, this book is about conquering self. And self is all that is standing in the way of my success, my riches. There are no other real obstacles.

Think And Grow Rich – Chapter 14: The Sixth Sense: The Door to the Temple of Wisdom

Continuing my analysis of Think and Grow Rich.

This is for Chapter 14, The Sixth Sense: The Door to the Temple of Wisdom.

(Go here to start from the beginning.)

Quote and Analysis

“THE “thirteenth” principle is known as the SIXTH SENSE, through which Infinite Intelligence may, and will communicate voluntarily, without any effort from, or demands by, the individual.”

To dismiss any ambiguity, he is indeed saying that by following this philosophy you will receive messages from Infinite Intelligence.

And further, these messages will come to you without you having to request them. They will be messages that tell you what you need to know to take advantage of an opportunity, or avoid an impending danger. These messages will come as “hunches”.

Quote and Analysis

“This principle is the apex of the philosophy. It can be assimilated, understood, and applied ONLY by first mastering the other twelve principles.”

The other 12 principles are Desire, Faith, Auto-Suggestion, Specialized Knowledge, Imagination, Organized Planning, Decision, Persistence, Power of the Master Mind, Mystery of Sex Transmutation, Subconscious Mind, and the Brain.

Quote and Analysis

“The SIXTH SENSE is that portion of the subconscious mind which has been referred to as the Creative Imagination. It has also been referred to as the “receiving set” through which ideas, plans, and thoughts flash into the mind. The “flashes” are sometimes called “hunches” or “inspirations.””

These messages are hunches or inspirations. Not necessarily voices that speak to you in words, but a feeling or an idea that pops into your mind.

Quote and Analysis

“My experience has taught me that the next best thing to being truly great, is to emulate the great, by feeling and action, as nearly as possible.”

Note that he mentions not only action, but feeling. You need to foster the same feelings as the person you are emulating, the person you want to be like. This would also include adopting that person’s beliefs.

Quote and Analysis

“Every night, over a long period of years, I held an imaginary Council meeting with this group whom I called my “Invisible Counselors.”

My method of addressing the members of the imaginary Cabinet would vary, according to the traits of character in which I was, for the moment, most interested in acquiring. I studied the records of their lives with painstaking care. After some months of this nightly procedure, I was astounded by the discovery that these imaginary figures became, apparently real.”

I found this fascinating. He basically studied these people to the point where he could “simulate” them in his head. And he would ask them for the positive parts of their personalities that he wanted to emulate.

Now, consider how you probably use this exact method even more often AGAINST yourself. Think about how often you’ll have an argument with someone from your past in your head. How you’ll imagine what you should have said, or what you would do if you saw them again. All of this is mentally practicing negative personality traits.

Quote and Analysis

“You, of course, have recognized that this chapter covers a subject with which a majority of people are not familiar. The Sixth Sense is a subject that will be of great interest and benefit to the person whose aim is to accumulate vast wealth, but it need not claim the attention of those whose desires are more modest.”

Kind of an interesting point…you don’t have to use this principle if you only want modest wealth.

Quote and Analysis

“The sixth sense is not something that one can take off and put on at will. Ability to use this great power comes slowly, through application of the other principles outlined in this book. Seldom does any individual come into workable knowledge of the sixth sense before the age of forty. More often the knowledge is not available until one is well past fifty, and this, for the reason that the spiritual forces, with which the sixth sense is so closely related, do not mature and become usable except through years of meditation, self-examination, and serious thought.”

So if you put proportionately more time into meditation, self-examination, and serious thought, then you could get there faster than age 40 or 50.

Quote and Analysis

“Having read the chapter, you must have observed that while reading it, you were lifted to a high level of mental stimulation. Splendid! Come back to this again a month from now, read it once more, and observe that your mind will soar to a still higher level of stimulation. Repeat this experience from time to time, giving no concern as to how much or how little you learn at the time, and eventually you will find yourself in possession of a power that will enable you to throw off discouragement, master fear, overcome procrastination, and draw freely upon your imagination. Then you will have felt the touch of that unknown “something” which has been the moving spirit of every truly great thinker leader, artist, musician, writer, statesman. Then you will be in position to transmute your DESIRES into their physical or financial counterpart as easily as you may lie down and quit at the first sign of opposition.”

This is another of the pieces of the book that encourage “repetition” and “persistence”, telling you to come back and read it again.

Also, this is a description of what experiencing the Sixth Sense will feel like….no discouragement, no fear, no procrastination, and expansive imagination…and things will work for you without effort.

Quote and Analysis

“FAITH VS. FEAR!

Previous chapters have described how to develop FAITH, through Auto-suggestion, Desire and the Subconscious. The next chapter presents detailed instructions for the mastery of FEAR.

Here will be found a full description of the six fears which are the cause of all discouragement, timidity, procrastination, indifference, indecision, and the lack of ambition, self-reliance, initiative, self-control, and enthusiasm.

Search yourself carefully as you study these six enemies, as they may exist only in your subconscious mind, where their presence will be hard to detect.

Remember, too, as you analyze the “Six Ghosts of Fear,” that they are nothing but ghosts because they exist only in one’s mind.

Remember, also, that ghosts-creations of uncontrolled imagination-have caused most of the damage people have done to their own minds, therefore, ghosts can be as dangerous as if they lived and walked on the earth in physical bodies.”

Here is a list of qualities that are clues to fears you might harbor. If any of these are feelings or qualities you experience, it would be good to analyze why and what fear is behind it. And since Faith is the opponent of Fear, you can then identify which belief it is that you need to change to remove the Fear. And then you can use Auto-Suggestion to install that belief in yourself, and overcome the limiting quality.

He also points out here that our imaginings can cause damage to ourselves similar to what I noted above with the mental arguments. It is our own choice whether we choose to imagine empowering situations or disempowering ones.

No Lose Stocks / Options Trading 2015 Option Expiration Review

January expiration just passed, so it’s time do a review of the returns for my options trading system.

For some background, I don’t count a trade as a winner/loser until it’s sold, or expires. So I gauge the returns of my system based on all the trades that expire on the same expiration date. So my reporting lags about 2 years, meaning I currently have trades in my portfolio that will expire in 2017. I won’t know until then how well I’m doing now.

Here’s the review of the January 2014 expiration trades.

OPTIONS PURCHASED TO OPEN TRADE

Contract $/Contract Buy Date
JNJ 150117C00095000 $0.4 9/26/2012
XOM 150117C00135000 $0.36 10/12/2012
PG 150117C00095000 $0.32 10/22/2012
AVP 150117C00025000 $0.55 10/23/2012
CSCO 150117C00025000 $0.74 10/25/2012
WMT 150117C00100000 $0.33 11/19/2012
WIN 150117C00012000 $0.25 12/20/2012
KO 150117C00050000 $0.31 12/31/2012
T 150117C00045000 $0.3 1/2/2013
GE 150117C00030000 $0.26 1/10/2013
DELL 150117C00017000 $0.11 1/17/2013
RTN 150117C00075000 $0.22 1/30/2013
CTL 150117C00060000 $0.05 1/31/2013
TGT 150117C00090000 $0.13 1/31/2013
MRK 150117C00055000 $0.51 2/4/2013
MO 150117C00045000 $0.21 2/5/2013
LMT 150117C00115000 $0.55 2/5/2013
SYY 150117C00040000 $0.3 2/6/2013
BP 150117C00060000 $0.31 2/13/2013
SO 150117C00055000 $0.21 2/14/2013
DD 150117C00065000 $0.33 2/19/2013
DD 150117C00065000 $0.33 2/19/2013
PFE 150117C00040000 $0.1 2/21/2013
MCD 150117C00140000 $0.22 3/8/2013
RAI 150117C00055000 $0.35 3/11/2013
PPL 150117C00037000 $0.4 3/15/2013
VZ 150117C00070000 $0.17 3/15/2013
LLY 150117C00075000 $0.43 3/27/2013
LO 150117C00058330 $0.29 4/1/2013
CAG 150117C00050000 $0.1 4/2/2013
GIS 150117C00065000 $0.23 4/10/2013
NEE 150117C00100000 $0.39 4/15/2013
WM 150117C00055000 $0.2 5/2/2013
POT 150117C00060000 $0.5 5/6/2013
DUK 150117C00090000 $0.6 5/14/2013
AEP 150117C00060000 $0.25 5/28/2013
TRV Jan 17 2015 110.00 Call $0.55 8/6/2013
WMT Jan 17 2015 95.00 Call $0.52 8/23/2013
K Jan 17 2015 80.00 Call $0.39 8/29/2013
MMM Jan 17 2015 155.00 Call $0.77 9/23/2013
PG Jan 17 2015 95.00 Call $0.71 10/4/2013
BBT Jan 17 2015 45.00 Call $0.18 10/29/2013
LLY Jan 17 2015 65.00 Call $0.36 11/4/2013
KRFT Jan 17 2015 70.00 Call $0.45 11/6/2013
SO Jan 17 2015 50.00 Call $0.32 11/6/2013
TGT Jan 17 2015 80.00 Call $0.82 11/6/2013
TWC Jan 17 2015 165.00 Call $0.50 12/23/2013
KMP Jan 17 2015 97.50 Call $0.29 12/24/2013

OPTIONS SOLD TO CLOSE TRADE

Contract $/Contract Sell Date
CSCO 150117C00025000 $2.88 7/9/2013
LMT 150117C00115000 $7.8 7/18/2013
RTN Jan 17 2015 75.00 Call $6.08 8/5/2013
JNJ Jan 17 2015 95.00 Call $5.13 11/20/2013
SYY Jan 17 2015 40.00 Call $2.10 12/9/2013
MRK Jan 17 2015 55.00 Call $3.33 2/5/2014
DD Jan 17 2015 65.00 Call $4.25 2/18/2014
RAI Jan 17 2015 55.00 Call $2.91 3/3/2014
LO Jan 17 2015 58.33 Call $2.91 3/4/2014
NEE Jan 17 2015 100.00 Call $2.70 3/17/2014
LLY Jan 17 2015 65.00 Call $2.12 7/24/2014
WIN Jan 17 2015 12.00 Call $1.16 7/29/2014
KMP Jan 17 2015 97.50 Call $1.74 8/11/2014
MO Jan 17 2015 45.00 Call $1.23 9/19/2014
MMM Jan 17 2015 155.00 Call $3.75 11/4/2014
LLY Jan 17 2015 75.00 Call $1.59 12/11/2014
AEP Jan 17 2015 60.00 Call $0.95 12/19/2014
PPL Jan 17 2015 37.00 Call $0.50 12/24/2014
SO Jan 17 2015 50.00 Call $0.49 12/24/2014

Summary

I purchased 48 options in the period from September 26, 2012 through December 24, 2013.

I sold 19 options when the underlying stock reached its strike price before the January 2015 expiration date.

That leaves 29 trades that expired worthless.

Note how painful that sounds…I didn’t even win 50% of the time. I was wrong more than half the time. But I don’t watch my portfolio, so I had no idea. I only got the notifications of the wins. And those are quite fun to get.

I purchased to open $1717/contract in trades, with $5 * 48 = $240 in commissions, (I’m estimating $5 per trade), for a total of $1957 paid out.

I sold to close $5362/contract, with $5 * 19 = $95 in commissions for a total of $5267 in deposits.

That means my return from September 26, 2012 through January 2015 was ($5267 – $1957)/$1957 = 169%…or roughly 75% per year.

I was wrong more than half the time, but I made more than 75% per year while doing it.

Also note that by 11/20/2013, the winning trades had already paid for all of the trades I would place in this group. Any trades that paid off in the year after that were pure profit.

It’s okay to be wrong…what matters is the magnitude of the times you are right, and the minimizing of the pain from the times you are wrong.

Note the opposite could also happen…being right 99% of the time, but those 1% wrong times could wipe you out.

Think And Grow Rich – Chapter 13: The Brain: A Broadcasting and Receiving Station for Thought

Continuing my analysis of Think and Grow Rich.

This is for Chapter 13, The Brain: A Broadcasting and Receiving Station for Thought.

(Go here to start from the beginning.)

Quote and Analysis

“Through the medium of the ether, in a fashion similar to that employed by the radio broadcasting principle, every human brain is capable of picking up vibrations of thought which are being released by other brains.

In connection with the statement in the preceding paragraph, compare, and consider the description of the Creative Imagination, as outlined in the chapter on Imagination.”

Here’s the description from the chapter on Imagination:

“CREATIVE IMAGINATION: -Through the faculty of creative imagination, the finite mind of man has direct communication with Infinite Intelligence. It is the faculty through which “hunches” and “inspirations” are received. It is by this faculty that all basic, or new ideas are handed over to man.

It is through this faculty that thought vibrations from the minds of others are received. It is through this faculty that one individual may “tune in,” or communicate with the subconscious minds of other men.”

Quote and Analysis

“The Creative Imagination is the “receiving set” of the brain, which receives thoughts, released by the brains of others. It is the agency of communication between one’s conscious, or reasoning mind, and the four sources from which one may receive thought stimuli.”

Here are the four sources from the chapter on Sex Transmutation:

“1. Infinite Intelligence

2. One’s subconscious mind, wherein is stored every sense impression and thought impulse which ever reached the brain through any of the five senses

3. From the mind of some other person who has just released the thought, or picture of the idea or concept, through conscious thought, or

4. From the other person’s subconscious storehouse.“

Quote and Analysis

“When stimulated, or “stepped up” to a high rate of vibration, the mind becomes more receptive to the vibration of thought which reaches it through the ether from outside sources. This “stepping up” process takes place through the positive emotions, or the negative emotions. Through the emotions, the vibrations of thought may be increased. “

Essentially, this is saying, if you want to have more creative ideas, then you need to harness your emotions in order to stimulate your mind.

Note he references either positive or negative emotions here.

Quote and Analysis

“Vibrations of an exceedingly high rate are the only vibrations picked up and carried, by the ether, from one brain to another.”

So if you want to disseminate your ideas to others, and get them to act on them, then you need to also infuse your own ideas with emotion. Specifically strong emotion. Otherwise the thoughts will not be “carried” to others, or to Infinite Intelligence.

Note this is different than the previous quote. The previous quote is about receiving “inspired” ideas or hunches to help you achieve your goals. This quote is about spreading your ideas to others to help you achieve your goals.

So when you have a goal, you can go at it from two directions here.

You can stimulate your mind with positive (or negative) emotions to receive “inspired” ideas to move you toward achieving that goal.

And you can come up with some ideas that you would like to pass to other people that would help you achieve your goal. Say you are selling something. You could infuse the idea of wanting to buy that thing with emotion, which would then transmit that idea to other people’s subconscious minds. And then it would bubble up in to their conscious minds. And then they would seek you out to buy your something.

Quote and Analysis

“The emotion of sex stands at the head of the list of human emotions, as far as intensity and driving force are concerned. The brain which has been stimulated by the emotion of sex, vibrates at a much more rapid rate than it does when that emotion is quiescent or absent.

The result of sex transmutation, is the increase of the rate of vibration of thoughts to such a pitch that the Creative Imagination becomes highly receptive to ideas, which it picks up from the ether.”

I’m still not sure I fully understand what he means by the “emotion of sex”, but my assumption is that he means we should think about doing things as if we were going to get sex in return. And when we think that way, we’ll get much more creative about how to solve whatever it is that we have put sex on the other side of. The intense energy that comes from sexual desire will stimulate our minds to be more receptive to “inspired” ideas from those 4 sources mentioned above.

Quote and Analysis

“On the other hand, when the brain is vibrating at a rapid rate, it not only attracts thoughts and ideas released by other brains through the medium of the ether, but it gives to one’s own thoughts that “feeling” which is essential before those thoughts will be picked up and acted upon by one’s subconscious mind.”

Here’s a further benefit of infusing emotion into a thought or idea…or giving them that “feeling”.

Our subconscious mind controls most of what we do.

Think about driving. Most of the time we get to our destination without even remembering how we drove there, but the whole way there our subconscious mind was making small decisions and directing our body to carry out those decisions.

Now, what if you could program your subconscious mind to carry out the tasks that you knew would get you to your goal? Maybe you don’t consciously do them because you are afraid (like making cold calls). Or maybe you are too lazy and just can’t force yourself to do them.

What if it was the opposite…what if you couldn’t force yourself NOT to do them?

That’s what it feels like to have your subconscious on your side. It just automatically drives you to the destination…to your goal.

And you get that benefit by infusing your ideas, thoughts, goals, and aims with emotion. Your subconscious picks up on that emotion and says “this is important…so I better make sure it gets done!”

Quote and Analysis

“Through the instructions described in the chapter on auto-suggestion, you were definitely informed of the method by which DESIRE may be transmuted into its monetary equivalent.”

The method, in short, is to write down your goal, memorize it, and say it aloud twice a day with feeling…that is, with emotion. And from the previous quote, this will then transmit that desire to your subconscious so it can start helping you to work toward that goal or desire.

Quote and Analysis

“Operation of your mental “broadcasting” station is a comparatively simple procedure. You have but three principles to bear in mind, and to apply, when you wish to use your broadcasting station-the SUBCONSCIOUS MIND, CREATIVE IMAGINATION, and AUTO-SUGGESTION. The stimuli through which you put these three principles into action have been described-the procedure begins with DESIRE.”

Here’s the lifecycle…

Desire – What do you want? Be specific. Write it down.

Auto-Suggestion – Twice a day, repeat it aloud. Feel it (this is where being specific helps). Infuse it with emotion. Feel good about it. Think about how much sex you’ll get when you have that desire.

Subconscious Mind – The auto-suggestion will pass that desire to your subconscious mind. The subconscious mind will start helping you to do the things that will get you there automatically. But it will also pass that desire on to others that can help you with it. And it will pass it on to Infinite Intelligence.

Creative Imagination – Once Infinite Intelligence gets a hold of your desire, it passes you back some “inspired” ideas about how to go about achieving that desire, and making it real. If you have strong emotions, so your mind is vibrating at a high degree, then you’ll be able to receive those ideas. And those ideas will pop up into your conscious thoughts as creative imaginings.

So that’s the whole deal. The other principles help boost these, but this is the core methodology.

“Whatever the mind of man can conceive and believe, the mind of man can achieve.”

Conceive your desire. Believe you will have it and feel good with that thought (no doubt), have faith. And the process above will hand you back the “inspired” ideas and plans to make it a reality, so you will have achieved what you conceived.

Quote and Analysis

“The procedure is very simple. We sit down at a conference table, clearly state the nature of the problem we have under consideration, then begin discussing it. Each contributes whatever thoughts that may occur. The strange thing about this method of mind stimulation is that it places each participant in communication with unknown sources of knowledge definitely outside his own experience. If you understand the principle described in the chapter on the Master Mind, you of course recognize the round-table procedure here described as being a practical application of the Master Mind. This method of mind stimulation, through harmonious discussion of definite subjects, between three people, illustrates the simplest and most practical use of the Master Mind. By adopting and following a similar plan any student of this philosophy may come into possession of the famous Carnegie formula briefly described in the introduction. If it means nothing to you at this time, mark this page and read it again after you have finished the last chapter.”

This is a description of exactly how to use the Master Mind principle for problem solving.

An interesting point is that in this case the problems they are trying to solve are not even their own problems.

Also, each contributes whatever thought may occur. That’s a pretty trusting situation. In most settings, we hold back most of our thoughts for fear of what someone else at the table might say.

No Lose Stocks / Options Trading 2014 Option Expiration Review

A friend recently asked what returns my options trading system was generating, and I realized I hadn’t done a review of the trades that expired in January of this year (2014).

For some background, I don’t count a trade as a winner/loser until it’s sold, or expires. So I gauge the returns of my system based on all the trades that expire on the same expiration date. So my reporting lags about 2 years, meaning I currently have trades in my portfolio that will expire in 2016. I won’t know until then how well I’m doing now.

Here’s the review of the January 2013 expiration trades.

OPTIONS PURCHASED TO OPEN TRADE

@PG 140118C00080000 $0.4 Jan 22nd, 09:30
@ED 140118C00070000 $0.2 Dec 27th 2012, 09:30
@MCD 140118C00110000 $0.44 Nov 29th 2012, 09:32
@MO 140118C00040000 $0.24 Nov 7th 2012, 09:55
@DUK 140118C00075000 $0.65 Oct 25th 2012, 09:30
@JNJ 140118C00090000 $0.15 Sep 27th 2012, 09:30
@CL 140118C00140000 $0.58 Sep 27th 2012, 09:30
@MO 140118C00045000 $0.22 Sep 24th 2012, 09:31
@KO 140118C00052500 $0.12 Aug 21st 2012, 11:51
@BMY 140118C00042000 $0.28 Aug 10th 2012, 09:30
@PEP 140118C00095000 $0.19 Aug 7th 2012, 14:07
@PAYX 140118C00040000 $0.45 Jun 29th 2012, 09:30
@SLE 140118C00022000 $0.45 Jun 12th 2012, 09:31
@KFT 140118C00050000 $0.49 May 18th 2012, 09:30
@RAI 140118C00055000 $0.3 Mar 23rd 2012, 09:30
@CTL 140118C00050000 $0.4 Mar 19th 2012, 09:31
@VZ 140118C00050000 $0.45 Mar 7th 2012, 09:30
@T 140118C00040000 $0.3 Mar 7th 2012, 09:30
@PFE 140118C00030000 $0.24 Feb 28th 2012, 09:30

OPTIONS SOLD TO CLOSE TRADE

PAYX Jan 18 2014 40.00 Call $1.8 8/5/2013
@JNJ 140118C00090000 $3.5 Jul 15th, 12:38
@DUK 140118C00075000 $2.25 Apr 24th, 15:20
@BMY 140118C00042000 $2.67 Apr 23rd, 09:56
@MDLZ1 140118C00050000 $0.65 Apr 19th, 11:06
@HSH1 140118C00022000 $0.6 Apr 17th, 14:23
@PG 140118C00080000 $2.99 Apr 12th, 09:31
@PFE 140118C00030000 $1.58 Apr 11th, 10:53
@VZ 140118C00050000 $2.41 Apr 11th, 10:52

Summary

I purchased 19 options in the period from Feb 28, 2012 through January 22nd 2013.

I sold 9 options when the underlying stock reached its strike price before the January 2014 expiration date.

That leaves 10 trades that expired worthless.

Note how painful that sounds…I didn’t even win 50% of the time. I was wrong more than half the time. But I don’t watch my portfolio, so I had no idea. I only got the notifications of the wins. And those are quite fun to get.

I purchased to open $6.55 * 100 = $655 in trades, with $5 * 19 = $95 in commissions, (I’m estimating $5 per trade), for a total of $750 paid out.

I sold to close $18.45 * 100 = $1845, with $5 * 9 = $45 in commissions for a total of $1800 in deposits.

That means my return from February 28, 2012 through January 2014 was ($1800 – $750)/$750 = 140%…or roughly 70% per year.

I was wrong more than half the time, but I made more than 70% per year while doing it.

It’s okay to be wrong…what matters is the magnitude of the times you are right, and the minimizing of the pain from the times you are wrong.

Note the opposite could also happen…being right 99% of the time, but those 1% wrong times could wipe you out.