Five months into 2026, I want to do three things in this update:
Review the performance honestly,
Lay out the framework I use to size this whole operation
For premium members; walk through exactly where the capital is going and what kind of returns it is generating.
Let me start with the numbers, because everything else is downstream of them.
The performance
I began this book with $50,000. Realized profit to date sits at roughly $26,800 — call it a 54% return on that initial capital across the first five months of the year. This past week I deployed close to an additional $50,000 of working capital. The mechanics of that matter: return is return on capital deployed. If I roughly double the capital base, then all else equal I should expect roughly half the headline return rate until those new positions mature and begin throwing off their own profit.
Measured against the total working capital now outlaid rather than the original stake, the book has returned about 22% over almost five months, or somewhere near 44% annualized if the cadence holds. Realized income booked this month was $3,000. That is a handy little digital income stream, and in plenty of places — much of Europe, for instance — it would sit at or above the median annual salary.
*All figures are in USD
Operating Company Vs Investment Portfolio
The distinction between an operating company and an investment portfolio is imperative and dictates things like cash reserves held and tactics used etc. These trades are viewed as inventory. They carry an additional, rather lovely form of downside protection: if I get stuck in any of these positions, they are already assets I know intimately and am happy to own. I can simply kick them across into the long-term portfolio. There is no forced exit on a name I love.
Inside the operating company, my goal is to minimise the working capital, not maximise it. It is a game of minimum threshold. What level of income do I need from this particular source, with a sensible buffer? What return can I safely generate against it? Those two answers determine how much capital I commit.nEverything beyond that, given the choice, I funnel into the long-term investment portfolios: Crassus, the Royalty King portfolio, and the Croupier Collection.
The Framework
Here is the part you can take and apply to your own circumstances. Sit down with your favourite LLM — I have been doing a great deal of this with Claude lately, talking my thinking through and getting it into visual form — and work out what income you actually need. Monthly, semi-annually, annually, whatever frame fits your life. Then ask the harder question: what return can you safely generate? From there you reverse-engineer the working capital required to produce it.
If one is trying to replace their employment salary, the most intuitive way to do it is in days of work. If you are a subcontractor in a white-collar professional services role, one day a week might be worth, say, $500 USD in the Australian market — roughly $4,000 a month. So if you wanted to buy back one day a week, that is your target: replace $4,000 a month from an alternative source. At 2% a month, the capital required falls straight out of the arithmetic ($200k in working capital) . Then you scale it — two days, three days, four — until the line where the job becomes optional.
I am not pretending this is for everyone, and there are no guarantees I can keep this up. I am simply documenting what I have been able to do. The leverage that options and short selling make available is, used carefully, an extra lever to reach a critical mass of capital — the kind that either frees you from a circumstance or quietly takes the cost-of-living pressure off. Whether that is applicable to you is yours to decide.
If you are reading the free edition: the ideas and the formulas above are the part I keep outside the paywall deliberately. Below this line I open the books — the live positions, the mechanics, and the actual returns on the capital I just deployed.
