Time to learn more...options (Page 2 of 5)
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Originally Posted By Morgan321: If you have an options position that goes into the money it seems very reasonable to grab the profit rather than wait and hope the profit is larger in the future on the expiration date. Am I missing something? Your logic implies that waiting to execute will always result in larger profit and that is obviously not true. The warning I gave about having to hold until expiration was specific to call debit spreads. In the HOOD $45/$47 screenshot above, the liquidation value of the position is only $560 despite the fact that it’s 99.9%+ likely to be worth $1400 48 hours later. It would be silly to close it early. In contrast if I just held the $45 (long) call without the $47 (short) call sold against it I could have sold early for a huge gain without waiting for the expiration date. My point was more about the illiquidity that you can have with multi leg contracts. To your point about exercising the contract early I don’t have that power holding the contract the way I do. Since only the owner of the contract can exercise it I cannot exercise the $45 call I own because that would make the $47 call that I sold naked with nearly unlimited loss potential. Now if the owner of the $47 call exercised it (against me) my broker would force me to exercise my $45 to cover it and I’d get paid the $2 difference per share in the process. Spreads seem 10x more complicated than the actually are and I’m probably a poor teacher but they can be a useful tool under certain conditions where you can make big gains off of relatively small movements in share price. |
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The great thing about spreads is that they eliminate most greek risk, the major down fall is that they aren't worth their full value until the extrinsic value decays at expiration. I find them to work best in two ways. First buying at the money with the spread a strike or two wide about a month to expiration and looking for 30-50% of the initial debit as profit. Normal market fluctuations can help these be profitable even when you get it a bit wrong. The second way is to buy a wider spread at a 30 delta, this is more of a shot in the dark and can be used as a hedge, 3-400% profit is my target on those. Because of skew debit spreads work best as bearish positions, although in the rare products with reverse skew call spreads will work. They do remove the explosiveness of options, so they are best used as base hits or doubles, if you want home runs straight options or butterflys are a better option. |
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Originally Posted By Procat: Update: After posting this I ended up selling (9) more $RKLB puts for a total of (14). As of today they’re down to $1.39 with over a month left. If they get below $0.50 before the end of September I’ll probably go ahead and close them and move on. Sold (10) $LUNR $8 cash secured puts today for 10/17. Filled at $0.45 for a net credit of $443.27. Stock was at $8.40 at the time. Without breaking out a calculator that’s either a 5%+ gain in less than 6 weeks (if unassigned) or a 10% discount on the shares compared to today’s price (if assigned). ETA 9/15 Closed 4 of the 14 RKLB $39 cash secured puts for $0.50 As of today the LUNR puts are still sitting around $0.10 so I’ll probably just wait until 10/17 and let them expire. Right after I closed 4 of my 14 RKLB puts the stock dropped back into the $40s and their value went back up to around $1. At this point I’ll probably just let the remaining contracts expire or close if they drop to >$0.05 Used some of my loose change to sell a pair of cash secured puts on BMNR. Disregarding fees / slippage this works out to a 10% return in 2 months. Attached File ETA: 10/2 (10) RKLB puts closed for $0.25 10/1 (10) LUNR puts closed for $0.02 |
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I sold some covered calls on FBTC at $110 that expire on 17 October. FBTC is up to $107 today. These are my highest cost shares and if they sell at $110 my profit will be around 55%. They are in my pre-tax IRA so no tax concerns. I am working under the assumption that if they go into the money they will not be sold until execution. Is there a "best" strategy to roll your calls out and/or up if the goal is to get more money out of them and/or to keep them? Seems like the most profitable course may be to wait until 1 week or less from execution and roll them out a short time (2-3 weeks) and up a small amount that still gives me a credit. If they expire I get the credit and it they execute I get the higher price. Repeat as long as you feel like it. Logic is that I'm hesitant to sell bitcoin calls far in the future (sell calls for 1.2x and bitcoin goes 3x and miss a lot of profit), so to maximize the ratio of time until expiration (old days to expire/new days to expire) you wait until closer to expiration. The value of the original calls then decays faster than the value of the future calls. Plus you can wait until a couple days out and maybe let them expire if that's what you decide is best. Does any of that make sense? Am I overthinking it? Am I too stupid to see the forest through the trees? |
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@Morgan321 My mentor always told me to roll in the money covered calls (up in strike and out in time) when the breakeven was breached (strike of the call + premium received) I’ve found that to work pretty well most of the time but with high beta stuff it usually ends up being a better play to just let the shares go on a Friday expiration and Monday morning sell a cash secured put at the same strike and see if you can get them back. The difference on which approach works best generally depends on if the stock is on a bull run or is it just really volatile. ETA: It’s a pretty safe bet that even if the calls go in the money they will not be exercised early. |
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Originally Posted By Procat: My mentor always told me to roll in the money covered calls (up in strike and out in time) when the breakeven was breached (strike of the call + premium received) ....... The difference on which approach works best generally depends on if the stock is on a bull run or is it just really volatile. ETA: It’s a pretty safe bet that even if the calls go in the money they will not be exercised early. That's the easy choice if you cover your eyes and go just by simple math. But that's not what options are for! I've realized this - the issue is (obviously) not knowing which is the case. That is why I've avoided selling calls with execution dates more than a month or two out. Anything longer seems like throwing darts blindfolded. I've realized that ... I think I'm going to just rolling the calls out a week or two at a time (and up very little or not at all) and pocket the premiums until bitcoin does a normal dip, then buy to close. I guess the biggest issue is that I'm not 100% decided on keeping or selling the shares - if I was it would make the decisions much easier. Not complaining though - either outcome is a big profit, I think I'm just hung up on not knowing which results in more profit. |
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Originally Posted By Morgan321: I sold some covered calls on FBTC at $110 that expire on 17 October. FBTC is up to $107 today. Also sold some $29 sofi calls last week. Expiring today out of the money so I rolled them to next Friday and down to $28. Initial sale was $22 each, rolled for $77 each, total premium collected of $99 per call. I'm profitable if they sell at $28 and I want to sell them anyway so hopefully sofi closes between $28 and $28.99 on the 17th! |
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Yesterday sold (4) cash secured puts on HOOD for 11/7 at the $130 strike. Order filled at $4.30 with the net proceeds being $1717.33 Play on earnings, suspect they’ll beat estimates. Their “events contracts” business IE sports betting has seen huge volumes and the revenue from it isn’t included in most analyst’s estimates since it’s a pretty new product offering. Lots of option sellers avoid trading around earnings due to volatility but I like capitalizing on my high conviction names. |
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@Morgan321 Are you actively trying to get out of SOFI? I’m trying to get back in but that’s a whole different discussion. I ask because they report earnings on the 28th (I believe). If you go to the option chain for the 31st there’s some pretty good premiums on strikes in the low $30s. Just my 2 cents but if I held shares that I wouldn’t mind selling I’d probably look towards that expiration date but be a little less aggressive with them. Looks like the last $30 call of the day sold for $1.11, that’d be an extra couple hundred bucks per contract for holding an extra week or two. Pretty sure SOFI has beat estimates every quarter since going public (they’re habitual sandbaggers on guidance) |
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Originally Posted By Procat: @Morgan321 Are you actively trying to get out of SOFI? ……Pretty sure SOFI has beat estimates every quarter since going public (they’re habitual sandbaggers on guidance) I’ve been reading up on them a lot and have considered making a play on the upcoming earnings. One thing I’ve learned about earnings though is that it for big moves it doesn’t matter if they do well, all that matters is how they did relative to their previous guidance and if they revise future guidance. |
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Originally Posted By Morgan321: Is anybody looking at the SOFI earnings coming out in about two weeks? If so, what sort of options strategy are you be looking at? Believe the earnings call is scheduled for 10/28 before the bell. I have some $25 cash secured puts for 10/31 that I’d be fine if they got assigned but I suspect they won’t. I have an order in for some 10/31 $27-$28 call debit spreads but I set my limit price toward the low end because I only want in if the reward potential is high enough. |
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Originally Posted By Procat: I have some $25 cash secured puts for 10/31 that I’d be fine if they got assigned but I suspect they won’t. I have an order in for some 10/31 $27-$28 call debit spreads but I set my limit price toward the low end because I only want in if the reward potential is high enough. You sold $25 puts (and have $2500 cash per put available) based on the assumption that favorable earnings mean sofi will be above $25. You're getting the premium in exchange for the risk of buying at $25 when market price is under $25, correct? And you're OK with this because you would hold the shares long-term and believe they would ultimately be profitable? The call debit spread was discussed earlier - you're paying a fraction of the maximum profit ($100 per call in this case) so you (obviously) want the minimum buy-in cost. ie. Buy in for $20 and get $100, so your profit is $80, or 4x. ETA: Fidelity is showing me this $27/$28 spread would cost almost $50 right now - so closing above $28 on the 31st would double your money, correct? I see that lower strike spreads (higher likelihood of execution) cost more, thus limiting your profit. A $24/$25 spread would cost around $65 with a max profit of $35, so a max return of 54% rather than the $27/$28 of 100%? I think I'm learning! |
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Originally Posted By heavily_armed: Anyone have experience with Tastylive events? They have one near me soon, I reserved a spot. Dr. Jim Schultz is the main guy. I’ve seen a few YouTube videos that he’s been in. Should be very educational. Of the content of his that I’ve seen most of it was geared towards managing your positions when required which is critical IMO. |
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Originally Posted By heavily_armed: Anyone have experience with Tastylive events? They have one near me soon, I reserved a spot. Dr. Jim Schultz is the main guy. I've seen Tom Sosnoff live a couple times, but not at a Tasty event, those have never been convenient for me to attend. Sosnoff was interesting to hear speak, well researched with some interesting twists on fairly common trades. In general the Tasty folks are anti-chartites, so I would expect it to be more probability based, but an excellent chance to learn about options. Side note: I wonder if they are getting close to starting the Small Exchange back up. |
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Originally Posted By Procat: I have an order in for some 10/31 $27-$28 call debit spreads but I set my limit price toward the low end because I only want in if the reward potential is high enough. Do you rely solely on the numbers? Only on your guesswork? A combination? Would your assessment of "enough" reward be different if you were doing it on margin vs having the cash and shares on hand for execution? Do you know what the logic is behind behind a call debit spread requiring "tier 2" options at Fidelity? I assume it's because the lower priced call could get executed and force you to buy when the higher priced call isn't executed? But even with cash on had for that situation it won't let me since the account in question is only "tier 1". Is it possible for only one end of a spread (of any type) to be executed prior to expiration? ETA: SOFI covered calls at $28 expiring today, so $99 per call profit to date. Unfortunately I'm in the red overall after the declines over the last couple days, deciding what to do with SOFI. |
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Picking a risk to reward ratio that I’m comfortable with depends on a handful of factors but I don’t have a set mathematical formula to calculate it. In the $HOOD call debit spread earnings play on page 1 I was comfortable betting on a quick 100% return. For the $SOFI example more recently (that never filled) my price was $0.35 because I wanted a 200% return for taking that same risk. The confidence in the companies to beat earnings is the same but I know $HOOD was more likely to run harder on the same news (higher beta) so I was willing to accept a smaller reward. Margin doesn’t affect the trade since the long call is backing up the short call. Technically. I know Fidelity makes you sign up for tier 2 options to do spreads which requires enabling margin. The only reason I can think of why they do that is incase the short call get exercised early and due to volatility or mispricing it somehow results in a loss and you don’t have the funds to cover. That would be a very unique situation. |
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Originally Posted By Procat: I know Fidelity makes you sign up for tier 2 options to do spreads which requires enabling margin. Fidelity only allows "limited" margin in IRAs so it appears my only option is to use a taxable account for anything beyond "tier 1" options. Are you using a taxable account or am I missing a way to do "tier 2" in an IRA at Fidelity? |
| I’m trading options in both a taxable account and a rollover IRA with Fidelity. I remember when I enabled options on the taxable account it listed the various tiers but now that I think about it I don’t remember that same thing for the IRA. That said I have lots of spreads in the IRA. It’s possible that (in a taxable account) they just required enabling margin for some of the other features unlocked in tier 2 but I’m not sure. |
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Originally Posted By Procat: I’ve seen a few YouTube videos that he’s been in. Should be very educational. Of the content of his that I’ve seen most of it was geared towards managing your positions when required which is critical IMO. Thank you and Herc for the feedback, something came up I was unable to make it. 
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Originally Posted By Procat: Believe the earnings call is scheduled for 10/28 before the bell. Sale at $31 would be a bit over 10% profit excluding the premiums. |
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Listening to the SOFI earnings call now. Looks like those $31 covered calls for this week are probably cooked Morgan. Placed an order to buy to close my $25 cash secured puts for this week at <$0.05. Suspect it’ll fill at the open. My plan is to take the collateral and sell OTM puts on PLTR for next Friday. If they put up decent numbers and the puts drop to near worthlessness I’ll close them and make the same play on HOOD who reports a few days later. |
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Originally Posted By Procat: Listening to the SOFI earnings call now. Looks like those $31 covered calls for this week are probably cooked Morgan. Placed an order to buy to close my $25 cash secured puts for this week at <$0.05. Suspect it’ll fill at the open. My plan is to take the collateral and sell OTM puts on PLTR for next Friday. If they put up decent numbers and the puts drop to near worthlessness I’ll close them and make the same play on HOOD who reports a few days later. I'm debating whether to keep going with selling the SOFI calls or to close and sell my shares - both my calls and my shares are in the green right now.... I ventured beyond selling calls... I sold one put of FBTC and ended up buying it. I immediately sold a $100 call on those shares that expires Friday. It's just over $100 now and my net cost after premiums on the shares is in the $95 range. I'm not a buyer at current bitcoin prices, so my logic is that I want it to sell. If the call goes into the green before it expires I'll close it and sell at a profit. |
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Originally Posted By Morgan321: ETA: by cooked do you mean the $31 calls are increasing or decreasing in value? I'm debating whether to keep going with selling the SOFI calls or to close and sell my shares - both my calls and my shares are in the green right now.... Cooked is just slang for short options going in the money. IE you’re going to lose your shares. Of course that statement was based on the performance before it sold off at the open. If I were in your shoes I’d probably let the $31 covered call ride. Even if it doesn’t rebound once everyone digests the earnings we should get a rate cut this week which should be a tailwind for banks. If it expires worthless this week the first Friday in December is also the next S&P 500 rebalance announcement date (SOFI meets all eligibility criteria) so you could probably milk good premiums from covered calls the next 5-6 weeks. Especially if you can be aggressive with the deltas of your strikes if you don’t care if you get the shares called away. |
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Originally Posted By Procat: If I were in your shoes I’d probably let the $31 covered call ride. Bought to close at $34 and sold the shares at just under $29. Totaled up that makes profit of $1.82 per share from premiums and $0.87 (yes really) per share on the buy/sell price. That's $2.69 per share, or almost 9% profit in about 2 months. Not great, not terrible, but very educational. |
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9% in 2 months is doing awesome and most people would brag about doing that in a year. Congrats. It’s easy to get drunk on premiums selling options. Especially on high flying tech names. My mentor always told me to shoot for a 25-30% annualized return to avoid getting too aggressive, it’s advice that’s served me well even if I don’t always follow it. |
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Originally Posted By Procat: 9% in 2 months is doing awesome and most people would brag about doing that in a year. Congrats. It’s easy to get drunk on premiums selling options. |
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Originally Posted By Procat: Placed an order to buy to close my $25 cash secured puts for this week at <$0.05. Suspect it’ll fill at the open. My plan is to take the collateral and sell OTM puts on PLTR for next Friday. If they put up decent numbers and the puts drop to near worthlessness I’ll close them and make the same play on HOOD who reports a few days later. SOFI puts closed this morning. Used the freed up collateral to sell some puts on BMNR for the week and HOOD for next week. Skipped playing PLTR earnings because it’s at ATHs today and the premiums on put strikes I’m comfortable with weren’t worth it. |
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Originally Posted By Morgan321: Bought to close at $34 and sold the shares at just under $29. Originally Posted By Morgan321: Bought to close at $34 and sold the shares at just under $29. Originally Posted By Morgan321: ....... don't be afraid to take a profit (ie. don't fret over possibly missing out on more money - take the profit and run). Last week I made my roth contribution for the year and bought 100 shares of fbtc at an average price of $96.44 for the purpose of doing some more learning by selling very aggressive calls with the intent of collecting premiums while keeping the shares. I immediately sold a $100 call on it for $1.09 (fbtc was in the upper $90 range at the time) that looks like it will expire tomorrow. I have lots more ftbc in this account that is up around 100% that I don't want to sell, but I am willing to "leap frog" selling calls if it's clear they won't execute. ie. I'm fairly confident the $100 call will expire tomorrow(fbtc around $94 today), so I'm willing to sell another call the day of (maybe the day before) expiration if it appears reasonably certain no more than one call will execute. $96.44 cost less $1.09 premium means my effective cost now is $95.35, so I'm looking to sell another call today/tomorrow at/above $96. |
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Be careful selling calls on stocks you want to keep (or puts on stocks you really don’t want to buy). In theory you can keep rolling out but it becomes a PITA if it keeps going against you. In a taxable account those rolls can also create some short term losses which may sound like a good thing but if you keep rolling under water covered calls eventually there will be a big short term gain whenever you let it expire. |
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Originally Posted By Procat: Be careful selling calls on stocks you want to keep (or puts on stocks you really don’t want to buy). Worst case is the calls go deep in the money and I gain slightly less than if I had just sold the shares outright. I had great luck earlier this year and was pocketing premiums at a rate that would be around 8-9% annually, but I was being very conservative because I didn't want to lose the shares. This time I'm going to try it through the end of the year and be very aggressive to see how much more I can make. |
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I'm going to sell a call every Friday that expires in 1 week where the premium is $95 or better (to make the premium roughly equal to 1% profit). Like I said previously I have lots of FBTC so I will overlap these single calls on Friday assuming the old one is not in danger of going into the money to avoid the expense of buying to close. If bitcoin tanks and 1% profit calls would be a net loss I will sell the call at the lowest stroke that results in a net profit. Last week's $100 call expires today so I sold another fbtc $99 call expiring next Friday for $1.04. Cost basis of $96.44 minus premiums ($1.10 and $1.04) makes my effective cost $94.30 for these 100 shares. This will execute sooner or later - I'll continue rolling this dice just to see how long I can sustain a weekly 1% profit. ETA: first call expired and the $110 premium pocketed. ETA2: second call bought to close today (3 Nov) for $19. Net cost basis up to $94.49. ETA3: Sold a $95 call expiring next week for $104. Net cost basis down to $93.45 |
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I've noticed that the options on fbtc are not very active - it sometimes makes it hard to execute a transaction at a "market" price. It's normal to have zero volume on large swaths of options spanning all strikes and expirations. I'm going to switch some of my positions to ibit since they have significantly greater options volume. The bid/ask are tighter and the last price is closer to reality. Stupid question on taxable options trading... if I sell an option for $10 and later buy it back for $2 it appears the taxable amount is the difference ($8) - is that true? |
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2 weeks in selling puts on bitcoin. Goal is to collect a small amount of premiums using liquid cash sitting in a taxable account. It looks like you can collect around 1/4 of a percent premium per week at strike prices where the delta is on the order of 0.04-0.05 and execution is very much a longshot. The fidelity website always shows 99% chance of profit. If the cash is collecting 3.8% and you also get 1/4% weekly on it that's in the neighborhood of 15% annual return. Assuming you are OK with potentially purchasing at the strike price, is there a downside? I hate that this is all taxable, but that's where the cash is and I can't change that. |
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Originally Posted By Morgan321: The fidelity website always shows 99% chance of profit. If the cash is collecting 3.8% and you also get 1/4% weekly on it that's in the neighborhood of 15% annual. I explained this concept in a few GD threads where people were debating between TBills, CDs, HYSA, ect and I think only one person ever actually got it. The rest of the responses were about what you would expect given the willful ignorance towards options that most people seem to have. |
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Originally Posted By grendelbane: Besides taxation, the main downside I see is opportunity cost. But there is no good way to tell before the fact. Originally Posted By grendelbane: Besides taxation, the main downside I see is opportunity cost. But there is no good way to tell before the fact. Originally Posted By Procat: I explained this concept in a few GD threads where people were debating between TBills, CDs, HYSA, ect and I think only one person ever actually got it. The rest of the responses were about what you would expect given the willful ignorance towards options that most people seem to have. |
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Originally Posted By Morgan321: Explained it, meaning that my assessment is correct? Or that I'm an idiot and am overlooking something about the situation? No you’re spot on with your assessment. The math will change from stock to stock but selling very low delta puts is an easy hack to boost your returns on idle cash. (Provided your broker pays interest on cash set aside as collateral / not all do last time I checked). Pick stocks you like and strike prices that would be back up the truck type situations anyway and sleep well at night. I’ve run the numbers a few times for people I know and their favorite tickers and 10-20% per year is pretty common with the put premiums + money market rates. ETA: about 1/3 of my account is currently running a similar strategy |
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Originally Posted By Morgan321: ETA3: Sold a $95 call expiring next week for $104. Net cost basis down to $93.45 Originally Posted By Morgan321: ETA3: Sold a $95 call expiring next week for $104. Net cost basis down to $93.45 Last week's $95 call expiring in 2 days is still there - I put in a $5 buy to close order that hasn't happened(due to the low volume FBTC options market). I'm pretty confident FBTC won't hit $95 by Friday, but who knows what bitcoin will do in 48 hours! Some shares are slightly in the red, but I'm overall very profitable and that's a good position to be in. Originally Posted By Procat: ETA: about 1/3 of my account is currently running a similar strategy |
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Originally Posted By Morgan321: Care to share a few examples? ie. what time horizons on what stocks? I like to sell deep OTM cash secured puts on companies I already hold because I follow them pretty closely. Mainly PLTR, HOOD, RKLB, SOFI. If one of them is trading towards the bottom of its range I generally look for a lower strike that would require support to be broken to approach. Recently I was selling $135 puts on PLTR 60 DTE (when the stock was $170-$180) About 30 days in if we had a solid green day I’d usually buy to close or roll them as it’d generally recognize 75% of the premium in 50% of the time. Around Q3 earnings when the stock hit $200+ I closed them all out for peanuts. Since then I’ve just been selling weekly ATM puts on HOOD because the premiums are wild but when things calm down I’ll probably go back to 2 month contracts. |
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Originally Posted By Procat: Provided your broker pays interest on cash set aside as collateral ....... Originally Posted By Procat: Provided your broker pays interest on cash set aside as collateral ....... Originally Posted By Procat: Recently I was selling $135 puts on PLTR 60 DTE (when the stock was $170-$180) About 30 days in if we had a solid green day I’d usually buy to close or roll them as it’d generally recognize 75% of the premium in 50% of the time. Around Q3 earnings when the stock hit $200+ I closed them all out for peanuts. Since then I’ve just been selling weekly ATM puts on HOOD because the premiums are wild ... Seems like an incredibly safe bet at those levels. Famous last words! |
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Looking hard at selling the $HOOD Jan 16 2026 $100 put. Closing price Friday was $4.50 so you’re looking at 4.5% in 2 months plus whatever SPAXX pays on the funds (Fidelity). Delta just under .20 isn’t super safe but risk is offset by the fact that the stock would be a screaming buy at that price. Currently at $123ish so it’s $30 off its recent ATH. That’s after reporting and awesome quarter and recent monthly metrics indicate their options business is putting up record numbers. Their predictions market business is also growing and being that we’re in football season Q4 should put up good numbers in that segment also. The put contract duration doesn’t include earnings. If it did dip and the contract(s) were assigned I would just immediately sell the Feb 26 monthly call at around $150. They’ll probably report the first week of February so the call contract would probably pay good ETA: Sold 1 this morning at an even higher price. Attached File |
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I sold a couple pltr calls at crazy low strikes, premiums are small at around 5% annual but I’m being conservative as I feel it out. Only done Bitcoin options up to now… all my calls are in the $1 range with this Bitcoin decline. I’ve stopped selling calls during this Bitcoin drop and have been selling lots of puts via ibit, also at conservative strikes because I don’t want to end up with a small fortune of it. |
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Originally Posted By Morgan321: I’ve stopped selling calls during this Bitcoin drop and have been selling lots of puts via ibit, also at conservative strikes because I don’t want to end up with a small fortune of it. Timing is probably the trickiest thing with selling options that I struggle with. If you sell a 60DTE contact and 30 days in its value is $0.05 because the stock went in the other direction it’s a no brainer to close it. The problem then becomes what to do next with either the cash (from closed puts) or the shares (from closed calls). Sitting on your hands waiting for a reversal to sell again can be nerve wracking. With range bound stocks you don’t want to sell calls at the lows nor puts at the highs. Case in point I have several thousand shares right now of various tech names that have been hammered this month. I could sell calls on them today and pocket a few thousand dollars. Holding out for a potential rate cut or end of year rally because the premiums could easily be twice what they are today if I wait a few weeks. |
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For anyone wanting to learn options from the ground up direct from the source, the OIC offers free online courses taught in modules. It's far better than any book you might struggle with or YT videos where you only get part of the picture. You have to set up a FREE account, you won't get spammed, then you can take the courses at your own pace. Ideal for the total noob. And for those with some YT leading experience, you'll pick up stuff that may not have been mentioned especially stuff involving risk. https://www.optionseducation.org/ |
How come every time there is a shooting, they want to take away the guns from the people who didn't do it?
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Originally Posted By Procat: Timing is probably the trickiest thing with selling options that I struggle with. I sold a bunch of fbtc this week, profits in the 20-60% range on each position. Selling puts on ibit to replace it, hope is to effectively short my way to a few % profit plus pocket some premiums. ibit is in the 47 range today and I have lots of puts expiring in the 42-47 strike range.... 14 minutes to go and it's at $47.87. Quite the nailbiter! Timing is always a problem that you can't solve. I've found the large issue is deciding which method you want to use to generate profit. ie. do you want to collect premiums on options unlikely to execute? Do you want to sell puts/calls in lieu of limit orders when you don't have to buy/sell at any particular time? Or do you want to actively trade options to profit on the change in premiums? I've found there is a strong tendency to start with one of those goals in mind and then, if/when the market moves differently than you anticipated, you change your motivation to one of the other options. If you start from a position where any of the three options will be profitable you can avoid losing, but you will also limit your upside. Like anything else it's just a risk-reward tradeoff. Read up on "risk compensation" if you're interested. ETA: ibit closed at $47.97, all puts expired(highest was $47!) FBTC closed at $73 - way below the calls I sold. Everything that expired today netted me about $140 or so in premiums in 5 days. |