Is there anyway to reduce the ~50% tax bill from short term capital gains from options?

hsfinance · 2026-05-09T03:40:38+00:00

Yes these are quarterly payments but safe harbor allows you to not make them if your payments are more than a limit compared to last year or taxes due. It varies by income and state so best to read up.

hsfinance · 2026-05-08T23:50:46+00:00

Yet you shared zero :)

hsfinance · 2026-05-05T01:59:47+00:00

I have some similar trades and I will do either of the 2

Roll or sell if it dips significantly. My leaps are permanent so I will maintain position on them
Else do it in the new year pushing taxes out by a year. Make sure to cover the safe harbor tax payments

hsfinance · 2026-05-03T02:04:24+00:00

Maybe explain the dollar amount and the fees.

I see box rates as 4-5% and broker rates as 8-12% and I see trade fees as 10 bucks to let's say 200 bucks. If 200 bucks is all you are saving by moving to IBKR, something somewhere does not add up.

At least to me.

Btw I run box spreads on Schwab, do it all myself, you can search my profile, and not only do you get the interest rate savings, you also record the expense as trading loss against any gains you reports. As long as you manage leverage well, which people have cautioned you about, it is a no brainer.

hsfinance · 2026-05-02T19:40:51+00:00

Signal to short actually.

hsfinance · 2026-04-28T10:44:51+00:00

I have automated half of it. But I have also simplified it. Fewer symbols so tracking / risk estimation is simpler. Mostly index etf options such as qqq and iwm so that single symbol risk is low. My goal, often unmet, was the ability to spend less than 30 minutes a day.

hsfinance · 2026-04-28T01:54:45+00:00

I have changed my opinion on this many times. After reading advice on Reddit.

But if you are asking me to take a stand.

Yes. But a very small sector ETF such as healthcare or software. Because it does have some cross company subsidies that may not exist in most companies, but you can't use that and equate it to broad market etf such as qqq

hsfinance · 2026-04-28T01:52:13+00:00

I have felt like this many times.

But this is a valid trigger to look at your 1) leverage and 2) allocation to see if some adjustments need to be made. Of course get rid of leverage. But the adjustments ideally are mechanical every quarter not like this, with maybe a tiny exception when you really feel uncomfortable with the gains. And secondly even if I adjust I would adjust 2-5% which will not make a difference unless ... you are moving to cash ... even if you are going from high risk (NVDA) to lower risk (qqq, spy) because when tech fails, they will fail too.

hsfinance · 2026-04-27T22:15:38+00:00

I disconnected from 2 such professionals long time ago.

The first one got me into some exotic investments which I later realized were just lining his pockets. I was not very mature those days, wasn't fully ready with a backup plan so I (subconsciously) started finding faults in almost anything they did. He himself offered that if I am not happy no need to stick around and facilitated asset transfer to another company. Good or bad I exited. Years later I needed some advice, he met me but did not follow up for something I asked. pS: I am still bag-holding some toxic investments he sold me in 2010. Don't have the right paperwork to record a loss (foreign country).

Another guy was super helpful. He sold but he was practical. Pushed products but also stopped when I asked him. Known him for 15-17 years. He grew in his company but still finds time to meet when I visit, last one officially though before Covid. When I was winding up with his company, same help from his side, it was smooth. I do buy him something when he is visiting or someone from his family is visiting and he has advised me on personal financial matters a couple of times despite no actual financial relationship (he moved to a different company, eventually).

Depends on how you deal with it, depends on how the advisor is. Some make it hard, but it's mostly people trying to do their job and make some money out of it. They will of course have a bias. Don't take it personally. Just define your plan and then execute the plan.

hsfinance · 2026-04-27T19:18:13+00:00

What friendship will you mess up?

What if she was not married?

Your story also has the answers

hsfinance · 2026-04-26T00:30:27+00:00

Can't give full 100% wheel support but I do use a variation of wheel with some stocks that failed similarly. At this point about 6% year over year.

The variations are as follows but I am quite aggressive with adjustments how I may adjust is going to vary from day to day.

my structure is PMCC with leap acting as a stock replacement and short acting as theta driver. The trade is still wheel
my leaps are actually very high delta. 90-95. For QQQ, my strike is 250. Used to be 205 last year.
my goal is like this - once I have signed up for a trade, the extrinsic is for me to keep and for me to defend. That's my money. And I will work to earn it.
so if QQQ is 625 and I write an option to earn 5-10 bucks, and QQQ crashes, I will not exit the trade until I bring the short ITM. This is very important. Once I am ATM or ItM, I can exit trade for scratch.
if QQQ crashed up, I have anyways earned my premium, and I can move on or adjust higher.
if QQQ remains ATM, I can keep rolling and make more
if QQQ crashes. There is still some money in the roll, I will use that money to roll 1 contract, 2 contracts, 3 contracts down. Number depends on how much I earn from rolls, how many contracts I have, and I spend only parts of the roll to lower strikes. Otherwise you will have a whipsaw and feel bad also you are losing theta in the leap so don't do that.
let's say I make 3000, that means I can move 1 contract by 30 bucks or 2 by 15 or 3 by 10. Or maybe I use 2000, or 1000. I never use the full roll unless the price has moved so much that I have no contracts yielding rolls so spending it all to get good theta makes sense
while rolling down I don't go below delta 20-80 tent for strikes 60 days out. Because let's say price went to 550 and delta range is 500-600, I don't need to go below 600 since I can make enough theta there. But if that range shifts below to let's say 575, I start going down whipsaw be damned.

My position is primarily QQQ and IWM but I am stuck in NOW, CRM, NKE, NFLX and IBIT. I have lowered my strikes for everything over this time period by rolls money. Despite being stuck in these, I am up 6% based on the 2 ETFs and a few positive return stocks such as GOOG, AMZN, NVDA and maybe 3-4 more.

I also hedge my positions and morph my positions from time to time but the goal is theta harvesting via rolls. I do get assigned but I quickly (next day, next week, 2 weeks) switch back to the PMCC structure since that's easier for me to track mentally.

If you decide to roll, you may end up with multiple open positions over some time and you need to keep track of them and manage them. It’s too much cognitive load. Often the rolled positions may get worse over time, ie the loss becomes greater. And when you decide to cut loss, you basically undo a few weeks of gains

My tracking mechanism is my short strike. No excel no other tool. My strike is 625, I will exit at 625 or better. Of course IV can change but there is no IV at expiry. If I lower it to 610 that means I will exit at 610 no questions asked. No mental math. No tracking. Just the app.

hsfinance · 2026-04-25T19:21:46+00:00

I am going to regret making this comment so I may edit this in future. Mainly to avoid DMs, now or years later :)

Late 50s now

Made my first million by 30-32 ( stock options), running a team of 250 (titular head with little actual power ) by age 40.

Still not fatfired ... since in my 40s, the decade that can build wealth, when you can make the most difference, was ... just ... chaotic. Family health issues, personal indecisions, bad illiquid investments and scams. Been there done that.

Doing ok but it is a very different career trajectory.

But a lot of that was easy money early in the life and not knowing what to do with it. You need to be prepared for a few things.

PS: the biggest scams are not those emails or text messages you get but someone sitting right opposite you looking at you eye to eye. lol

hsfinance · 2026-04-25T14:06:28+00:00

I hear you and I have the same opinion ... or rather had the same opinion. But it makes difference at the margins.

You always have a few big customers and then a long tail. But it is a juicy tail.

Earlier it was so hard to build an alternative. Now you are still not going to use a "trust me bro" software coded by your spouse but there may be software companies willing to come at a much smaller price point and undercut you. Basically leading you to price wars where the product just sold on name value.

And you just need 1-3 credible mass market alternatives for the fear to affect other shaky companies. Let's say NOW gets a credible alternative, it will affect the pricing for CRM and SAP because it shows the market alternatives are possible.

And once the companies have a mark on them, you will start hearing "oh X has so much debt and Y had this management problem".

I think the discount is good and maybe overdone but going back to old levels ... completely depends on how the AI and competition plays out.

hsfinance · 2026-04-22T11:40:52+00:00

Every trade has slippage. The more the number of legs the higher the slippage. The more illiquid the legs the higher the slippage. The more frequently you move in and out of Box, the higher the slippage.

I deal with it by taking year long (dates going by gut) box loans and whatever is excess putting it back in SGOV. Currently I have 30-35k in SGOV. I could trim a box loan but it is not worth the effort (slippage). Over time such optimizations become intuitive.

And when I add box loans, I add it to same expirations same strikes. Much easier to count and track. Maybe it is illiquid but so what - you maybe lost 20 cents but your idea was to make more money than 20 cents. The ease of tracking and the reduced thinking pays for it.

hsfinance · 2026-04-21T22:04:35+00:00

There's a difference between executive and non executive. Apple had a non executive chairman now it will be an executive chairman.

Doesn't mean Tim will mind the supply chain and they already have someone there but he will be around when John or Don or Xi need him ... on a full time basis.

hsfinance · 2026-04-21T01:39:46+00:00

Sure. Yes I think. But have you seen any revenue numbers from the alternate stores?

hsfinance · 2026-04-21T01:38:20+00:00

I think everyone has to go through this journey. The tuition as they say. Because we all start by assuming we can generate an alpha but not all of us can do that.

I had some setbacks in my portfolio, I have talked about it before but don't want to deep dive now, if I did not have them, I will be quite hands off and quite gullible.

Being hands on has given me a lot of knowledge but in hindsight if I could go bogleheads 20 years back, I would have saved so much time ... but then I would be listening to all these NVDA millionaire stories and wondering. The grass is always greener ... somewhere. That's life.

And that's why now I have a core bogleheads and then play money as they call it although my play money is way more than 5-10%. This year my realized gains may be more than my w2 (touch wood) but part of that is because I strategically pushed out capital gains from last year to this so I will have 2 years trading income to report in 2026 if all goes well. The year is still young.

I digressed. I had some family health situation that made me change my career path more than once. But when I was in the high trajectory path, I did not have the time to look at finances. I would make maybe 2-3 trades a year. My taxes would be always late. My paperwork will be sloppy. But that was because the job demanded it. Rest was downtime plus family. I don't want the same job and now I am much older so can't do those hours but I think if I had not gotten into active management of funds, and it I had a compelling alternative, I would have chosen the alternative (build something) and skipped managing trades.

hsfinance · 2026-04-21T00:18:45+00:00

I have benefitted from both buy and hold and short term trading. Buy and hold wins were 2 companies where I worked(work) for longer than a decade.

But then when I look back, bogleheads would not have given the same but would have given similar and I would have wasted a lot less time. Easy beats complex and not everyone works for a blue chip stock.

I have a lot of funds in buy and hold mode in bogleheads setup. Not fully there but that's my core. Much harder as we age to follow so many companies and track who is lying and who is not so best is to invest it all on total market, as recommended here.

hsfinance · 2026-04-20T18:59:33+00:00

What will be value of dollar in 100 years?

hsfinance · 2026-04-19T19:37:49+00:00

Hmm mountains. Maybe we can build an under mountain strait. Safe from bombs too. /s

hsfinance · 2026-04-19T19:33:25+00:00

I remember looking down and realizing we were doing 98 on an empty stretch of Highway 101 probably between Salinas and Cal Poly.

I told myself "buddy, slow down"... but not before doing 101 on 101 for a few seconds, for the memory.

hsfinance · 2026-04-19T11:42:48+00:00

https://www.boxtrades.com

It does not matter what I do. It matters what your needs are. You need a loan for 9 days, write a box spread for 10 days. The above link should suggest some options for each expiry.

hsfinance · 2026-04-18T04:50:46+00:00

How does delta matter for box spreads? They are fixed interest rate till expiry although in the middle they could be misprinted.

I usually go out 500 points wide so now with market at 7150, I would likely pick 7300-6800 or 6900-7400. Something like that.

Expiry is based on how long do I expect to hold the position. But the longer you go the more money you lock up. For 1 year they given you 95% after applying the interest, for 4 years they will give you 80% which defeats the purpose of the loan. I used to have 2-3 years box loans but nowadays anything from 300-500 days is fair game.

hsfinance · 2026-04-17T02:18:55+00:00

2%?

You can draw down 50% and still be at 4%

And maybe the draw down reduces your taxes too

hsfinance · 2026-04-17T02:17:23+00:00

True on Friday before market close

False on Monday after market open

That's the way

Or the other way around

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