Rescue My IRA March 2014 Results

While the market value of Rescue My IRA shows sideways movement for March, the account’s cash value actually grew, so I’d assess this as a good month.  That’s despite the fact that global chaos and tepid economies continue to be in the mix.  As I noted last month, Warren Buffet and others have said that good news or bad, the stock market rises in the long term – so I’m holding my place with about 70 percent of Rescue My IRA in stocks.

I plan to continuing rolling along with this unusually large (at least compared to what I've typically maintained in the account) cash reserve on hand until we get a little bit of a correction, or until the market starts moving up again.  While I have had this strategy in place, I have been a little worried about my portfolio approach – I only have 9 or 10 positions going at the moment, as opposed to the 12 to 16 that I consider optimal.  As cash becomes available from position close outs, I am investing with the goal of lowering the average position value to create more diversity in the account.

To close out these introductory remarks, I’ll repeat that March was a good month:  the account value reached above $158K a couple of times before settling at the value I’m reporting today as of month end. Although it didn’t start out that way, the dividend returns were higher than usual, at $437.00, and call premiums were lower, at $325 – just about a half percent return between the two of them.  Rounding out the returns was a solid gain on ABT, which I unwound earlier in the month, so the account met my goal of more than 1% return for the month.   

Here is a summary of my Rescue My IRA statistics for March 2014, based the March 28, 2014 close.   

Account Status:

·         Total Account Value, 3/28/2014 Market Close:  $157,488.79 (vs. February close of $157,816.52)

·         Total Cash Reserve, 3/28/2014 Market Close:  $53,892.78

·         Core Stock Positions (as of 3/28/2014):   CAT (100 shares), CRUS (400 shares), F (500 shares), FB (200 shares), GLW (600 shares), IP (200 shares), KO (400 shares), PFE (300 shares), PSA (100 shares), WIN (900 shares)

Performance Metrics:
Option Premiums Collected (net, month of March):  $325.26 (0.21 %)

Capital Gains Collected (net, month of March):  $1,135.73 (0.74 %)

Dividends Collected (recognized on the ex-date): $437.00 (0.28 %)
Interest on Cash Reserve (laughable): $0.38
Total, Absolute Return:  $1,898.37 (1.23% absolute return, 14.74% annualized return)

Next Month To-dos:

As I look forward to April, the month looks to be one where it will be a challenge to meet my goal of a 1% absolute return:  only two positions are scheduled for dividends (CAT and F), and I have three calls expiring (CRUS, GLW, and PFE).  The dividend income is offset by slight stock losses on these three positions combined, so I am starting off with a forecast of zero percent absolute return. 

I’m continuing to rebuild my spreadsheets for the account – the battery replacement on the old Dell didn’t end up working.  Mostly, I have everything back to a place where I can manage the account and keep the blog up to date.

I hope my readers have enjoyed a couple of good months in February and March, as I have.  Until April, happy trading!