Watch Video: Listen To Audio Version: To become an elite option-seller, we must master the 3-required skills… stock selection, option-selection and position management. With exit strategies, not only do we have to know which ones will enhance the current trade status but also how and when to implement them. This podcast will show a real-life […]
Implied Volatility (IV), IV Rank and IV Percentile: Defined and Practical Applications
When writing covered calls and selling cash-secured puts, the implied volatility of the underlying securities is directly related to the premiums we receive and also measures the risk we are taking with our option-selling trades. We protect ourselves from using IVs that are too high or too low by defining our initial time-value return goal […]
BCI PODCAST 49 Analyzing a Multi Leg Covered Call Rolling Down Series of Trades
Watch Video: Listen To Audio Version: Exit strategies can turn losing trades into profitable ones. This podcast will show a real-life example with NIKE Corp. (NYSE: NKE) where Alan rolled down twice in the latter part of a contract and put cash in his pocket on a stock that declined in value. The 20%/10% guidelines […]
How to Execute a Covered Call Trade with a Buy/Write Combination Form
Covered call trades can be entered by legging-in (2 separate trades) or via the buy/write combination form (1 net trade). When available, the latter is an effective, and perhaps cheaper, way to execute our covered call trades when the bid-ask spreads of our options are narrow. This article will explain how to use the combination […]
BCI PODCAST 48 Rolling Deep OTM Cash Secured Puts
Watch Video: Listen To Audio Version: When stock price moves up, put value moves down. After selling an OTM cash-secured put, if share price appreciates significantly, we can close it for a small percentage of the original option sale. This podcast focuses in on whether it makes sense to roll that option up to a […]
When Our Covered Call Strike Moves $1000.00 In-The-Money
This really happened. From March to August 2020, many of the large cap technology stocks were on fire. Thor shared with me a covered call trade he executed with Amazon.com, Inc. (NASDAQ: AMZN) where the strike moved $1000.00 in-the-money (ITM) as share price headed to the moon. As you read this article, see if you […]
BCI PODCAST 47 Rolling Up in the Same Contract Month
Watch Video: Listen To Audio Version: Position management is a critical aspect of covered call writing success. The key is to identify when these opportunities present and how and why to implement them. There are times when no action is the best choice. In this podcast, a real-life example with KMX is used to show […]
Adjusting Our Portfolio Mix to Achieve Diversification and Cash Allocation
To decrease portfolio risk for our covered call writing and put-selling portfolios we must be well diversified and allocate a similar amount of cash per position. The allotment of cash per-position will rarely be precise but it is a goal we must incorporate into our methodology. In this article, I will describe the process for […]
BCI PODCAST 46 Should Delta Be the Sole Criteria for Covered Call Writing Strike Selection
Watch Video: Listen To Audio Version: I am often asked, “What Delta should I use for my covered call strikes?” This podcast discusses how strategy goals, not Delta stats, should impact our option strike selections. Initial time-value return goal range, market assessment and personal risk-tolerance are emphasized. BECOME A BCI MEMBER TODAY: PREMIUM MEMBERSHIP SEE […]
Establishing Our Cost-Basis for Long-Term Holdings
When we initiate a covered call trade by first buying a stock and then selling a call option, our cost-basis, in the BCI methodology, is the lower of the stock price or strike price. If we sell an in-the-money (ITM) strike, we deduct the intrinsic-value component of the option premium from the share price bringing […]
Podcast
- 54. Selecting the Best Strike Prices for Our Collar Trades
- 53: ITM Cash-Secured Puts: Allow Exercise or Roll the Option?
- 52. Making Money Selling Options with Technology Stocks
- 51. Timing Our Covered Call Trades
- 50. Exit strategies Must Be Timed Properly
- 49. Analyzing a Multi Leg Covered Call Rolling Down Series of Trades
- 48. Rolling Deep OTM Cash Secured Puts
- 47. Rolling Up in the Same Contract Month
- 46. Should Delta Be the Sole Criteria for Covered Call Writing Strike Selection
- 45. Implied Volatility and Expected price Movement During the Life of Option Contracts
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