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 […]
Generating a 3-Income Stream Put Trade: A Real-Life Example with ZIM Integrated Shipping Services Ltd. (NYSE: ZIM)
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 […]
Rolling Weekly 10-Delta Put Options Prior to a Holiday Weekend: A Real-Life Example with Etsy, Inc. (Nasdaq: ETSY)
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 […]
Comparing Implied Volatility and Delta When Establishing Projected Trading Ranges During Our Option Contracts
In 2020, BCI developed 2 ultra-low-risk option strategies, one using implied volatility and the other using Delta to establish low- and high-end trading ranges during our covered call writing and put-selling option contracts. We will use 5 real-life examples to analyze the trading ranges predicted by each approach. The data was taken on 8/30/2021 for […]
Collar Strategy Using Weekly Calls and Monthly Puts: A Real-Life Example with LABU
The collar strategy is a covered call writing-like strategy where protective puts are added to our covered call trades. This creates a ceiling (the short call) and a floor (the long put). Typically, the expiration dates of the calls and puts are the same. We must also ensure that the call credit and put debit […]
Selling Cash-Secured Puts Exit Strategies: The 3% Guideline: A Real-Life Example with NVIDIA Corp. (Nasdaq: NVDA)
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, […]
Game Plan When Our Cash-Secured Puts are Exercised
When we sell cash-secured puts, we have selected a stock or ETF based on sound fundamental, technical and common-sense principles. We generally select out-of-the-money put strikes that meet our stated initial time-value return goal range. Once the trade is executed, we move to position management mode. This article will highlight the choices we have available […]
“Hitting a Put Triple” with Lowe’s Companies, Inc. (NYSE: LOW)
Exit strategies for covered call writing and selling cash-secured puts are an integral part of the BCI success model. In April of 2021, Tom was excited to share with me a series of trades he astutely executed with LOW where he generated 3 income streams with the same stock in the same contract month. […]
Selling Cash-Secured Puts to Simultaneously Generate Cash Flow and Buy a Stock at a Discount
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 will analyze such a dual-purpose trade proposed by Safi on April 23rd 2021. […]
Reversing Delta with the PCP Strategy: A Real-Life Example with Etsy, Inc. (Nasdaq: ETSY)
The PCP Strategy, called the “wheel strategy” outside the BCI community, involves selling cash-secured puts and covered calls. One of the ultra low-risk strategies developed by the BCI team involves selling weekly cash-secured puts with Deltas of 10 (-0.10) or less with an annualized return goal range of 10% to 20%. This article will highlight […]
Podcast
- 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
- 73. Mid Contract Unwind Exit Strategy at the End of a Contract
- 72. Rolling Covered Call Options on Expiration Friday
- 71: Dividend Yield Should Be a Secondary Factor for Covered Call Writing
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