Wednesday Wind Up – Closing Out 2014

Happy New Year!

What a year it's been, too. We added 2.7M jobs this year and that's good because we also added 2.7M people to our population so, essentially, we didn't lose any ground. As more and more people left the labor force (retired, discouraged)however, official unemployment fell from 7% to 5.8%.

We still have 2M less people working thant we did in 2007 – despite adding about 20M people (now 320M). I guess it's progres if one in 10 people are able to find a job, right?

Of course, none of that stuff matters as long as the rich get richer and boy did they – with the Forbes 400 adding $98Bn to their pile of cash in 2014. Now $98Bn is a lot of money for just 400 people to spend – so some of that trickles down to us poor folks who have humble financial newseletters or make expensive cars or pilot privat jets – you know, regular Joes in the top 10% – it's been a very good year for us.

It's been a very good year for the markets with the Nasdaq leading us with a 14.4% gain on the year followed by the S&P at 12.4%, Dow 8.5%, NYSE 5.2% and Russell 4.25%. More impressive than the S&P's 12.4% gain was the fact that we went the ENTIRE YEAR without having more than 3 consecutive down days. That has NEVER happened before, NEVER. We can thank the World's Central Banksters for that – these markets are now so manipulated, they can't go down anymore.

We spent 2014 emphasizing our "Be the House – Not the Gambler" investing strategy and, although the carefully controlled market performance led to low implied volatility (giving us less premium to sell), we still managed to scratch out impressive gains on all five of the virtual portfolios we track for our Members.

Our Short-Term Portfolio acts as a hedge for both our Long-Term Portfolio and our Income Portfolio. It began the year with $100,000 and, generally, we made bearish bets to offset our more bullish portfolios. As you can see from the charts above, we did catch a few nice dips and the leverage we had to the downside gave us some stunning gains at times and we are finishing the year (not including today, of course) up $60,880.99 (60.9%).
We cashed in our Income Portfolio at the end of October as it was up 20% (double the 10% goal for the conservatively invested $500,000 portfolio) and we didn't want to risk the 4th quarter.
Our Long-Term Portfolio also began the year with $500,000 and is also closing up 20.3% with a $101,495 gain and we head into 2015 with a $601,495 balance. We reviewed both the STP and the LTP in yesterday's live webcast – there will be a link for the replay in Member Chat this morning.
Our Butterfly Portfolio was also allocated $100,000 at the begining of the year and our safest strategy has yeilded a $15,900 profit (15.9%) for the year but it's the nature of this style of trading that the first year is a building year (as we buy a lot of long-term premium in advance of selling short-term premium), so we expect much better performance in 2015.
Our $25,000 Portfolio exceeded it's 20% goal for the year, ending the day up 22.1% at $30,530 (up $5,530) in what was also a building year (our goal is to get to $100,000 in 4 years or less before we reset).

Overall, investing $1,225,000 at the start of the year netted back $1,508,806 for a combined gain of $283,806 or 23.1% – about double the overall market returns by BEING THE HOUSE! In 2015, we will continue to emphasize our core strategy and we will build on it by working on long-term wealth-building techniques like the ones we discussed this weekend as well as in our "How to Get Rich Slowly" article on the 13th.

We're heading into the holiday weekend "Cashy and Cautious," a stance we have maintained since Thankgiving as we hit our goals for the year early and we didn't want to risk losses which, as it turned our, was a very smart move as the market plunged 10% in November. Now we've recovered all of that loss and more but it was A LOT less stressful to watch it happen from the sidelines than to ride it out with the rest of you.

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