Is it true that when we sell cash-secured puts, our maximum return is the initial put premium? Come on now, we’ve all heard and read that statement. This article will demonstrate how I generated a 6-income stream series of trades by executing, and then managing, a 10-Delta Monthly cash-secured put with INMD from 9/20/2021 through […]

A 6-Income Stream Monthly Cash-Secured Put: A Real-Life Example with InMode Ltd. (Nasdaq: INMD)
Posted on March 19, 2022 by Alan Ellman in Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling

Generating a 3-Income Stream Put Trade: A Real-Life Example with ZIM Integrated Shipping Services Ltd. (NYSE: ZIM)
Posted on February 26, 2022 by Alan Ellman in Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
We have all read that when we sell a cash-secured put, the maximum return is the put premium. Is that true 100% of the time? Enter our exit strategy arsenal. On 9/27/2021, Richard shared with me a series of put trades he executed with ZIM. It involved an initial put sale plus 2 BTC and […]

Making a Great Covered Call Trade Even Better: A Real-Life Example with Revolve Group, Inc. (NYSE: RVLV)
Posted on February 19, 2022 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Covered call writing trades, when structured and managed properly, can result in impressive short-term and annualized returns. Such was the case with Art who shared with me a series of trades he executed with RVLV in August – September 2021. The returns were outstanding and enhanced via exit strategy execution. This article will analyze the […]

When to Roll Options on Successful Trades: A Real-Life Example with iShares MSCI India ETF (BATS: INDA)
Posted on January 29, 2022 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Exit strategies for covered call writing are an inherent part of our BCI methodology. They allow us to mitigate losses, enhance gains and even turn losses into gains. There will be times when find ourselves in situations where it not 100% clear whether we should pull the trigger on one of our exit strategies versus […]

Rolling Weekly 10-Delta Put Options Prior to a Holiday Weekend: A Real-Life Example with Etsy, Inc. (Nasdaq: ETSY)
Posted on January 22, 2022 by Alan Ellman in Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling
One of the ultra-low-risk strategies developed by BCI in 2o20 involved selling weekly 10-Delta cash-secured puts. This created a greater than 90% probability that the puts would not be exercised (expire in-the-money or with intrinsic-value). Since 2020 – 2021 represented an unusually low interest rate environment, annualized returns of 8% – 15 % looked pretty […]

Closing a Covered Call Trade Mid-Contract: A Real-Life Example with Nucor Corp. (NYSE: NUE)
Posted on December 25, 2021 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
What happens when a covered call writing trade progresses much better than anticipated? This article will analyze a series of trades executed by William (thanks for sharing) with NUE as he utilized the BCI mid-contract unwind exit strategy. What rules and guidelines should we use to determine if closing both legs of our covered call […]

Selling Cash-Secured Puts Exit Strategies: The 3% Guideline: A Real-Life Example with NVIDIA Corp. (Nasdaq: NVDA)
Posted on December 18, 2021 by Alan Ellman in Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling
When we sell cash-secured puts, we must use all 3 of our required skills: stock (or ETF) selection, option selection and position management. Once we have selected an elite-performing security, we then choose an out-of-the-money (OTM) put strike that meets our initial time-value return goal range (2% – 4% per-month, for me). Without exit strategies, […]

Holding a Stock Through an Earnings Report Can Result in Impressive Returns: A Real-Life Example with Crocs, Inc. (Nasdaq: CROX)
Posted on December 11, 2021 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Fundamental Analysis, Investment Basics, Option Trading Basics, Options Calculations, Stock Option Strategies
One of the golden rules of the BCI methodology is never to sell an option (call or put) when there is an earnings report due out prior to contract expiration. Most of the time we avoid holding these securities in our option-selling portfolios due to the risk inherent in these reports. However, there are exceptions […]

Was I Correct to Close My Successful Covered Call Trade? A Real-Life Example with Revolve Group, Inc. (NYSE: RVLV)
Posted on December 4, 2021 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Alan K asked me to analyze a series of covered call trades he executed with RVLV over a 4-day period. Share price accelerated substantially once the trade was entered and a significant 4-day profit was realized. Let’s investigate all aspects of these trades. Alan’s trades 6/21/2021: Buy 300 x RVLV at $61.83 6/21/2021: STO […]

Analyzing Covered Call Writing Trades to Enhance Our Trading Skills: A Real-Life Example with The Clorox Company (Nasdaq: CLX)
Posted on November 27, 2021 by Alan Ellman in Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
One of the best ways to elevate our option-selling results is to analyze real-life trades. On August 3, 2021, Mark shared with me a series of trades he executed with CLX. His conclusion was that he was currently in a $250.00 net credit position. I will break down these trades into 3 stages. I ask […]
Podcast
- 83. Setting Up a Portfolio of Nasdaq and S&P 500 Stocks in a User-Friendly Manner
- 82. Risky Stocks Can Result In Challenging Decisions
- 81. Managing ITM Covered Call Strikes When Share Price Moves Higher
- 80. Using the VIX to Achieve Higher Option-Selling Returns
- 79. Adjusting Target Goals with ETFs
- 78. REITS: Good Covered Call Writing Candidates?
- 77. Buyers Have Rights and Sellers Have Obligations- Covered Call Writing Explained
- 76. 5 Top Myths and Misunderstandings about Covered Call Writing
- 75. Reverse Stock Splits Understanding Contract Adjustments
- 74. Strike Selection Using Technical Analysis and Market Assessment
Subscribe To Our Free Newsletter
Categories
- Ask Alan (14)
- Covered Call Exit Strategies (188)
- Exchange-Traded Funds (56)
- Exit Strategies (178)
- Fundamental Analysis (42)
- Investment Basics (489)
- Just Alan (6)
- Option Trading Basics (503)
- Options Calculations (335)
- Options Trade Execution (159)
- paper trading (4)
- Podcasts (85)
- Put-selling (72)
- Stock Investing (111)
- Stock Option Strategies (461)
- Stock Trading & Taxes (18)
- Technical Analysis (45)
- Uncategorized (19)
Recent Posts
- Mitigating Losses by Rolling-Down During a Severe Market Decline: The BCI Trade Management Calculator in Action + New Book Discount Code + Free Webinar Registration Link
- BCI PODCAST 83: Setting Up a Portfolio of Nasdaq and S&P 500 Stocks in a User-Friendly Manner
- Exit Strategy Choices After Exercise of a Cash-Secured Put: A Real-Life Example with Etsy, Inc. (Nasdaq: ETSY) + Free Webinar Registration Link
- Selling 10-Delta Puts with 4-Day Expirations + 2 Free Webinar Registration Links
Premium Membership
Why Covered Call Options May Be Your Best Investing Strategy
Nasdaq Interviews Alan Ellman
© 2020 The Blue Collar Investor. All Rights Reserved.
Beginners Corner Enhanced & Updated
- Lesson 1: Beginner's Corner for Covered Call Writing: 2nd Edition
- Lesson 2: Beginner's Corner for Covered Call Writing- 2nd Edition: Option Basics
- Lesson 3: Beginner's Corner for Covered Call Writing- Stock Selection
- Lesson 4: Beginner's Corner for Covered Call Writing-2nd Edition
- Lesson 5: Beginner's Corner for Covered Call Writing
- Lesson 6: Beginner's Corner for Covered Call Writing
- Lesson 7: Beginner's Corner for Covered Call Writing: 2nd Edition
- Lesson 8: Beginner's Corner for Covered Call Writing
- Video 9: Premium Membership
Beginners Corner Selling-Puts
- Lesson 1: What Is Puts Selling?
- Lesson 2: Puts-Selling Option Basics
- Lesson 3:puts-selling-technical analysis
- Lesson 4:puts-selling-Common Sense Considerations
- Lesson 5:puts-selling-Calculating Returns
- Lesson 6:puts-selling-Executing Put-Selling
- Lesson 7:puts-selling- Exit Strategies
- Lesson 8:puts-selling-Mastering Put-Selling
Recent Comments