Selling Cash-Secured Puts to Simultaneously Generate Cash Flow and Buy a Stock at a Discount

Selling Cash-Secured Puts to Simultaneously Generate Cash Flow and Buy a Stock at a Discount

Sep 4, 2021 | Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies

Selling cash-secured puts is a low-risk option-selling strategy geared to generating cash flow and beating the market on a consistent basis. In certain scenarios an additional goal of buying the stock at a discount is added to traditional put-selling. This article...
Rolling-Down with a Few Hours to Expiration: A Real-Life Example with Energy Select Sector SPDR (NYSE: XLE)

Rolling-Down with a Few Hours to Expiration: A Real-Life Example with Energy Select Sector SPDR (NYSE: XLE)

Aug 28, 2021 | Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Trade Execution

The 20%/10% guidelines are essential to our covered call writing exit strategies. They represent parameters as when to buy back our short calls. A frequent inquiry I receive related to these parameters is whether to remove the 10% BTC limit orders in the last few days...
Can Price Movement Be Explained by Profit-Taking?: A Real-Life Example with Global X Funds Infrastructure Dev. (PAVE)

Can Price Movement Be Explained by Profit-Taking?: A Real-Life Example with Global X Funds Infrastructure Dev. (PAVE)

Aug 21, 2021 | Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies, Technical Analysis

On April 8,2021, Nathan shared with me his covered call writing trade with PAVE which was initiated 3 days earlier. This exchange-traded fund had a strong technical chart but the price started declining immediately after the trade was entered. Nathan commented that he...

Application of the 20%/10% Guidelines Within a Broad Range of Implied Volatility Securities

Aug 14, 2021 | Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Trade Execution, Stock Option Strategies

I recently published an article titled Managing Implied Volatility Risk by Establishing an Initial Time-Value Return Goal Range. This article served as a catalyst for several inquiries from our members asking if the BCI 20%/10% guidelines applied to high volatility...
Managing Implied Volatility Risk by Establishing an Initial Time-Value Return Goal Range + Webinar Login Link

Managing Implied Volatility Risk by Establishing an Initial Time-Value Return Goal Range + Webinar Login Link

Aug 7, 2021 | Exchange-Traded Funds, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Investing, Stock Option Strategies

When screening for eligible securities for covered call writing and selling cash-secured puts, we must establish how much risk we are willing to incur. There is no right or wrong here as the appropriate amount will vary from investor-to-investor. To determine security...