Dividends , The Wheel --Cash secured Puts and Covered Call writting

[leftovers]

Hey Doctor I think you know more than you're letting us on! LOL Actually I don't really pay much attention to the Delta I just checked what the Delta is on my new TSLA position that got filled on Wednesday for the 212.50's for 1.05 on the weeklies 7/12. The Delta is -.11.


I use think or swim with TD Ameritrade and it was sold to them from Tom
Sosnoff who I highly recommend people follow! I would be lost without this trading software.

What I do when analyzing a new Put sell trade is first look up in the right hand corner of the option chain to see what the price range plus or minus is for the term of the option. Then I look at what the premium is selling for at the extreme of this range.


Example TSLA July 12 options have a range of 14.6 so I want to look at Puts that are out of the money at least 14 dollars. Then I look at those options and want to have a 80% chance of staying OTM by expiration.

Then I look at the open interest to see how much interest there is and if there is 1000 contracts or more open I am interested in placing the order.

Of course I like to look at the charts to see what the overall direction is. I am not a directional trader anymore with Options. Tried many times with buying calls and puts and always lost more than I made.

What I like about selling puts is you don't have to be 100% right on the direction . Of course the more the stock goes up the better you will be but, even if it goes sideways or a little down just as long as it remains OTM at expiration you win!


I tend to use the 2-1 rule for bailing and at that point I roll down to a lower strike. If you let it go to far it is hard to roll and get back to even. The 2 times I did roll it turned out that it actually closed OTM and I didn't need to roll.


The problem is most of the stocks I sell puts on I am not interested in owning so I don't take the chance. I never sell more than my account can absorb and always trade small.


The biggest risk I am taking is that where I live in eastern Euorope I have unreliable internet and there is always the chance I could loose internet and not be able to manage my trade!


I suggest following Tom Sosnoff on Tasty Trade where they have free courses and the real skinny on trading options!

https://www.tastytrade.com/tt/?utm_source=email&utm_medium=referral&utm_campaign=cb&mc_cid=98978ac06e&mc_eid=6b8ee834ff