One of the practical applications of selling cash-secured puts is to buy shares “at a discount” In my books and DVDs I use out-of-the-money puts in lieu of setting limit orders in order to accomplish this goal. Some of our members have inquired about using deep in-the-money puts (strike well above current market value) instead […]
Using Puts and SelectSector SPDRs to Create an Ultra-Conservative Option-Selling Strategy
Selling out-of-the-money puts and using top-performing SelectSector SPDRs can be combined to design an extremely defensive option-selling strategy in a volatile market environment like we are currently experiencing. Using Inverse Exchange-traded Funds is another approach. In this article, we will discuss the former strategy,. When we sell an out-of-the-money cash-secured put we are agreeing to […]
Selling Cash-Secured Puts On An Index
The index short put strategy is a form of selling cash-secured puts. It is a bullish strategy with the goal of generating premiums selling put options that expire worthless. Traditionally, at-the-money strikes are sold. As opposed to using stocks and exchange-traded funds as the underlying securities, index options are cash-settled at a profit if the strikes […]
How to Generate 10% Per Year in Bear Markets by Selling Stock Options
Covered call writing and put-selling generate monthly cash flow with the inherent risk of share depreciation. One of the major advantages of these conservative strategies is that they can be tailored to all market environments. In today’s article I will address one way to “stay in the game” even when market conditions are working against […]
ASHR: Exchange-Traded Fund in the Spotlight
Exchange-traded funds (ETFs) offer covered call writers and put-sellers the advantage of instant diversification and generally have a lower implied volatility associated with them compared to individual stocks. Whether we are dealing with stocks or ETFs each security must be evaluated on its own merit before using it as the underlying security. In this article, […]
Why Are Call Premiums Larger Than Put premiums For Near-The-Money Strikes?
When studying covered call and put-selling option prices we learn that the market will correct any potential arbitrage opportunities. Arbitrage is the simultaneous purchase and sale of an option in order to profit from a difference in the price. It exploits price differences of similar financial instruments. This would not be fair and rarely exists […]
Podcast
- 20. Rolling Down When There is a General Market Decline
- 19. Using the Ellman Calculator to Monitor "Hititng a Double" Trades
- 18. Market Assessment Analysis Based on Portfolio Composition
- Using Stock Dividends & Option Premium To Generate Cash-Flow
- 17. COMBINING Covered Call Writing and the Stock Repair Strategy
- 16. VIX Covered Call Writing Selling Stock Options on Market Volatility
- 15. Strike Selection When Selling Puts
- 14. Analyzing a Covered Call Trade Trade with a 5000% Return
- 13. Adding a Short Put To a Collar Trade
- 12. Mean Analyst Rating MAR
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