Nov 25, 2023 | Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
click ↑ 4 Featured When we sell cash-secured puts (CSPs), we are getting paid to undertake the contractual obligation to buy the holders shares at a price that we (the sellers) determine, called the strike price, by a date that we determine, called the expiration...
Nov 18, 2023 | Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
click ↑ 4 Featured One of our available cash-secured put trade exit strategies is rolling-up to generate an additional income stream (or multiple income streams). The disadvantage of this position management approach is that we are bringing the strike closer to...
Nov 11, 2023 | Exchange-Traded Funds, Exit Strategies, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
click ↑ 4 Featured Many option traders who sell cash-secured puts prefer not to take possession of the underlying shares. Typically, when a trade is structured, the strike is out-of-the-money (OTM- lower than current market value). Exercise will occur when the share...
Nov 4, 2023 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
click ↑ 4 Featured Our covered call writing positions are at risk when share price declines substantially. We do have, however, our exit strategy arsenal to protect against catastrophic losses. This article will show a real-life example of such a scenario with Novo...
Oct 21, 2023 | Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
click ↑ 4 Featured In bear and volatile market conditions, we may opt to take a defensive posture with our cash-secured put trades. One technique to accomplish this conservative approach is to use implied volatility (IV) to determine an approximate trading range for...
Oct 14, 2023 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Investing, Stock Option Strategies
click ↑ 4 Featured Stock options can be used to mitigate losses on shares we own at a higher price than current market value. Some investors will buy more shares at the new lower price and average-down, thereby adding more cash to an already losing trade. This article...
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