Feb 11, 2023 | Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
In last week’s segment, I posted a series of cash-secured put trades with Etsy, Inc. (Nasdaq: ETSY). Some trades were executed before an earnings report and a few post-earnings. This article will detail how to accurately enter and archive all trades using the...
Feb 4, 2023 | Exit Strategies, Investment Basics, Option Trading Basics, Options Trade Execution, Put-selling, Stock Option Strategies
When selling covered calls or cash-secured put options, we must avoid the risk of earnings reports. This is an important rule of the BCI methodology. This article will detail how a series of put trades were managed during the August 2022 contracts from 7/18/2022...
Jan 28, 2023 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Accurately calculating our covered call writing returns at the end of each contract cycle can be uncomplicated in some situations and more challenging in others. If we buy a stock at $48.00 and sell the $50.00 call at $1.50 and we allow exercise of an ITM strike...
Jan 21, 2023 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
When the Poor Man’s Covered Call (PMCC) strategy is employed, the short call is the active leg of the trade. If a strike is expiring in-the-money (ITM), we can roll the short call to a later expiration date. This article will detail 2 possible rolling trades...
Jan 14, 2023 | Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
Exit strategies for covered call writing and selling cash-secured parts are integral aspects of our trading system. It is critical to learn how to enter, calculate and archive these position management trades. This article will detail one example of this process using...
Jan 7, 2023 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
When selling out-of-the-money (OTM) cash-secured puts, we calculate our initial time-value returns with this formula: % return = Put premium/ (put strike – put premium) When incorporating exit strategies into our strategy, we must properly enter these...
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