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. […]

“Hitting a Put Triple” with Lowe’s Companies, Inc. (NYSE: LOW)
Posted on September 25, 2021 by Alan Ellman in Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies

Selling Cash-Secured Puts to Simultaneously Generate Cash Flow and Buy a Stock at a Discount
Posted on September 4, 2021 by Alan Ellman in 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 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)
Posted on July 10, 2021 by Alan Ellman in Covered Call Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
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 […]

Using Delta to Create Low-Risk/ High-Return Put-Selling Trades: A Real-Life Example with ETSY, Inc. (NASDAQ: ETSY)
Posted on May 22, 2021 by Alan Ellman in Fundamental Analysis, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
When selling cash-secured puts, our strikes are selected based on our initial time-value return goal range and personal risk-tolerance. In the BCI methodology, we use only out-of-the-money (OTM) cash-secured puts unless our objective is to purchase a stock at a discount and have those shares put to us sooner rather than later. There are times […]

The Collar Strategy: Using Longer-Term Put Expirations
Posted on November 7, 2020 by Alan Ellman in Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
When we add a protective put to our covered call trades the strategy is known as a collar. To reduce the monthly cost of the long put, some investors will consider using longer-term put expirations This article will explore the pros and cons of this approach using Ciena Corp. (NYSE: CIEN). Collar trade information […]

Selling Deep OTM Cash-Secured Puts with Exit Strategy Enhancements
Posted on September 26, 2020 by Alan Ellman in Exit Strategies, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies
This is a follow-up cash-secured puts article to the one published last week where I detailed how I was selling deep OTM cash-secured puts on Apple Computer (AAPL) to generate weekly cash flow. I was using strikes with Deltas below -0.10%, approximating less than a 10% of ending in-the-money. My goal was to generate 0.4% […]

Selling Deep OTM Weekly Cash-Secured Puts to Generate Substantial Annualized Returns
Posted on September 19, 2020 by Alan Ellman in Investment Basics, Option Trading Basics, Options Calculations, Put-selling, Stock Option Strategies
Selling Cash-Secured Puts is a strategy similar to, but not precisely the same as, covered call writing. It is generally used to generate cash-flow as a standalone strategy but also can be implemented to buy a stock at a discount or used in conjunction with covered call writing (PCP strategy). During the COVID-19 crisis in […]

Creating a Portfolio of Weekly Cash-Secured Puts
Posted on August 29, 2020 by Alan Ellman in Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Put-selling, Stock Option Strategies, Uncategorized
Selling cash-secured puts is a strategy similar to, but not precisely the same, as covered call writing. In February 2020, Chevy wrote to me asking for an article or video addressing weekly cash-secured puts, a strategy he was using and looking to enhance. The 3-required skills Whether we are selling calls or puts and […]

Bear Market Concerns and our Option-Selling Portfolios
Posted on July 4, 2020 by Alan Ellman in Exchange-Traded Funds, Option Trading Basics, Options Calculations, Put-selling, Stock Option Strategies
Covered call writing and selling cash-secured puts are stock option strategies with primary goals of income generation and capital preservation. Most of us are conservative investors who seek to beat the market on a consistent basis while minimizing portfolio risk. This is one of the mission statements of the BCI methodology. In the past few […]

Market Volatility and Our Option-Selling Trades: Using the VIX to Achieve Higher Returns
Posted on June 27, 2020 by Alan Ellman in Investment Basics, Option Trading Basics, Put-selling, Stock Option Strategies, Uncategorized
Options trading basics teaches us that the VIX or CBOE Volatility Index reflects the market’s expectation of the upcoming 30-day volatility. It measures market risk and is also known as the investor fear gauge. With this in mind, option-sellers are faced with a dilemma. Increased market volatility will translate into higher option premiums because the […]
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- 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
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- 78. REITS: Good Covered Call Writing Candidates?
- 77. Buyers Have Rights and Sellers Have Obligations- Covered Call Writing Explained
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- 75. Reverse Stock Splits Understanding Contract Adjustments
- 74. Strike Selection Using Technical Analysis and Market Assessment
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Beginners Corner Selling-Puts
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