so im starting to look more at the selling options bit, still wanting to keep it fairly simple. 2 things I am looking at

Selling puts for stocks at prices that i wouldn't mind buying at the strike price. Example would from this week would be selling sofi puts at a strike price of 6. Worst possible outcome here is that i get stuck with 600 dollars wroth of sofi, minus the premium and potentially i have to do that even if the stock somehow went to 0.

other one is i have a few hundred shares of VOD that i've been sitting on, its been bouncing between 9-10 for a few months. I want to sell covered calls at 8 cents, so while i hold the shares and collect the dividends and effectively double dip, the worst case scenario is that i get assigned and have to sell my shares at 10. Anything im missing with these?

I think the key components you need to look at when selling contracts consistently and reliably with as little babysitting are:

a) selecting time frame- weekly, monthly,

b) selecting strike price- are you selecting strikes based on your cost or delta?

c) understanding price trend- is it in a uptrend, downtrend, sideways?

d) understanding price cycle- is the stock seasonal, does it go through waves, do you expect a EOY dip, will it rally in January, are earnings upcoming, etc.


a) I almost always sell weeklies. It will give you the highest yield generally speaking, assuming you hold to expiration. It will have the highest time decay, per day.
b) I sell based on Delta. Markets are generally very efficient and they can more accurately forecast price movement better than I can. I currently use 10D when selling calls - the overall return is less but based on high IV stocks it's much safer which means less babysitting and less managing and less stressful
c) I am usually more aggressive with Delta if I feel the stock is sideways or in a downtrend. If it is in an aggressive uptrend then I will consider not selling calls for that period
d) stay away from unpredictable periods if you don't want your shares called away, particularly earnings weeks. Premiums will look really juicy during that but they are that high due to IV increase.

Great tips and refresher above.

my problem is when i sell a covered call, i always feel like i want to take profit when the underlying dips a bit and then re-sell after it recovers. This is in hopes to capture and recapture more premium. while i have been lucky a handful of times, other times, the stock just dips and doesnt recover for a while, and i miss the remaining 40-50% of the original premium that i would have gotten had i just let it gone to expiration.

I need to be more disciplined and quit messing with it

Averaged down my cost on TSLA as it dipped. Being patient with when I sell my weeklies. Good bounce on TSLA and SOXL this week. Net only a couple hundred this week but next week should be back to schedule as far as flow.

Forever myron.

Weeklies would be nice. I'm running TLT monthlies after I covered the rest of my TLT at $90. I think we still see 1 more rate hike before we are done. Everything has been resilient to this point and we really do need to see something break before anything happens. I'd love to see 20 or 30 year yields hit 5.5 before going back down. Regardless I'm here to collect premiums on the way down so I'm selling pretty much ATM. Average around $88 so it will be nice if I can collect an additional $1-2 monthly in addition to my dividends.

Sadly mostly out of all other options. Sofi doesn't have $7 options only 7.5 for whatever fukkin reason so I'll wait till it is closer to either $6 or $7.5 I guess. EGY rocking $4 CSP I'll take assignment on if oil drops and markets decide a company with a $430m and over $100m cash + 18m+ in receivables is worth less than current valuation. Payo I'm not covering shares at current prices and I added a bunch of $11.50 warrants that expire mid 2026. PE is plummeting as profitability continues jumping. Their growth is moderating and they are more than willing to sit back and let margins pop while collecting big interest checks on funds held in accounts.

I need to run the #s here shortly and see what I've made on the calls/puts I wrote to see how I did vs just holding shares over the past year. I'm curious to see if it is even worth holding a mixed bag of companies or if I should just sell it all and hold TLT for 5.5% and perhaps just write calls against those shares.

EDIT:

Did the math.

Sofi 1900 shares and made $1900 on options
Payo 1800 shares $1,250
EGY 3,000 shares $2,130 options + dividends

$5280 or roughly 15% of the cost to hold these shares at current prices(don't want to even mention cost basis ayy lmao).

My AMD long call I bought a while back deep in the money, and sold poor mans covered calls on for a while now, is up 20% and expires Jan 19, $60 strike, debating whether to take profit and close the whole thing or nah.. would you?

the thing with options is they can turn on a dime. too many times I waited a hair too long to take profit and it evaporated.

I would take anything more than 50% profit.

Was the call you purchased for further out? Why wouldn’t you just close the CC

even if you could, say buy the call on a different account but hold the CC in another, it's not an optimal strategy. I would have to know what premium you received and what the new call purchase price was. But seeing the calls are not yet in the money, it would be more optimal to BTC your CC and sell your shares, once it goes above your strike, rather than trying to do anything now. Consider that a call ATM is only 50D, meaning for every $1 the stock moves upward, the call only increases in value $0.50. So if the stock goes to $51, it would be $1 above your strike, whereas the call would only increase in value by $0.50, not accounting for IV. The other downside of purchasing OTM calls now is the amount you are paying for extrinsic value.

So assume your cc is in the money and you buy a call at the same strike, that loss/gain is equal, not accounting for spread. The multiple transactions of BTO and STC spreads on your new call work against your profit.

TSLA threw up a sell signal. BTC my Jan19 260cc and sold all my TSLA so I am completely out. Sold 1DTE 235P x10 and will take assignment if it closes below that and then sell ATM weekly calls next week. Potential down to 230 and then further to 223 gap fill. I think 200 is possible.

Holding big position in X.

Holding big position in TSLQ

Looking at MARA Apr 45C if we get a buy signal today.

really down on tsla eh?

I decided to segregate an account exclusively for selling options this year. started with selling some weeklies on sofi and pfe successfully. just starting with what i have while i figure out how to select stocks specifically for this function

TSLA is a sell for me for the time being. I'm long term TSLA bull though.

I would suggest a little caution when picking stocks for covered calls. Don't get sucked in to picking based on premium unless it's a stock you want to own for the medium/longer term because you can easily get trapped into holding longer than expected. When there is a downtrend, especially one that you don't forsee, you will lose opportunity cost not to mention potentially bagholding. My strategy differs based on whether I think a stock is moving sideways, up or down. It also goes without saying that if you are not using greeks you will eventually get caught bagholding.

so far, selling options has been a delight. im sure it could turn bad if i stray but sticking to puts on stocks i want to own anyhow and CCs. Only downside i see is a lot more capital allocation into these stocks as opposed to leaving piles of cash in ETFs.

^^ reducing your 2024 goals because of less active trading or you think its not going to be a year suitable to your trading style? or just because tesla is dorked up

re:2024 goals. It's a combination of things, as you noted. But I think mainly because I realize that the last couple of years were anomalies. Market went crazy, I got lucky a few times but I also made some poor decisions. This year I'm going to focus on perfect execution so that means taking less risk and fewer opportunities. Once I get that down, then the I know I will not need to worry about P&L. Trading is stressful enough as it is so taking more of the guesswork out of it removes some of the anxiety which makes it more sustainable in the long run.

Covered my EGY $4 CC at $30 from $65 for a decent savings against share value. Covered sofi at $15 from $75 for no reason last week. Would have expired worthless this week oh well. I’m about to buy some cheap Feb monthlies assuming their earnings are going to pop share price yet again as they announce profitability.

Currently holding:
Jan 2025 SAVE $10 at $1.55
May 2024 PAYO $5 CSP at $60
Feb SOFI $8 CSP at $75 just one of these might buy a few more assuming shares pop or I just take assignment. Might do $7 if IV explodes before earnings.

Keep thinking in the back of my mind to buy long dated VIX calls for big dump protection.

Currently holding no positions I want to sell CC on. Dipped my toes into scalps on weekly contracts. The goal is to find a stock that has clear mid term momentum and follow through with an intraday entry on a reversal to that same momentum. So for example if NVDA has clear mid term bullish momentum, I look to go long on calls when I see an intraday reversal from bearish to bullish. I buy ATM contracts (easier to predict my P&L, $1 move = $.50 premium move). I use pre-market high/low as a guide. Confirmation above/below is a strong signal.

9/9 quite pleased with myself. Not perfect execution but comfortable with what I'm seeing. Just over 9K net for the week.

see posts above re: goals. As to where to learn, I don't have an answer. This is trial and error for me. I've never taken a course or read a book on it. If you are a technical person then I would study T&A and learn candlesticks. The ability to recognize patterns is helpful. I've found I can see things that the average people does not - and that's not limited to stocks. I can spot order or anomalies in my surroundings. But spotting a trend is simply looking at a chart and determining if it is going up or down, dependent on the timeframe you're trying to analyze. A reversal is when it goes in the opposite direction as the trend. I think what you're asking/looking for is "how will I know before it happens so that I can buy/sell at the right time?" The answer is you don't. You wait until there is confirmation. And THEN you act.

Setting up your charts with indicators that you know how to read is paramount. You cannot be consistently successful in the long term (5-10+ years) if you do not have a good understanding of T&A. Investing yes, swing trading, maybe. But not daytrading. Which indicators to use? They all say the same thing, more or less, except they are presented on the screen differently. They all use the same parameters.

AMD weekly 170P scalp yesterday for 3K. 20 contracts, sold 1/2 when it hit my goal and then closed when it hit my target.

Holding weekly NVDA 600C overnight.

Closed NVDA 600C for 2750.

AMD 175C for 2125

TSLA 210P loss -450

2/3 for the day.

TSLA 180P yesterday for 1300

opened INTC Feb16 58C lotto but tanked in AH with earnings

not selling any options into earnings?

mostly cash. Posted my general thoughts about TSLA on discord. May buy some contracts for tech earnings but not STO.

Friday opened some 0DTE TSLA puts but it just chopped. Had to take a big loss and roll down and out.

Total for the week just over 5k net.

made a nice chunk of change off of sofi this morning. shares, calls and sold 20 7$ CSPs for friday that i closed out this am. Almost certainly over-exposed considering, but i've been using that to learn a bit since the stock is cheap and getting assigned on puts has been desirable.

Had a nice scalp on tesla calls today. left so much money on the table though. I got in at 240 and bailed at 320 during a pullback before they topped at over 4 bucks. one of the downsides of trading at work but meh

Nice. Was looking at puts when it was 182ish after open but moved to NVDA 715 calls. Closed some for 500 and still holding some overnight.

closed out the rest of my NVDA 715c for 1500. sold off my NVDA stock and SOXL. A little too top heavy for my liking and I think there may be a slight pullback in the next 10 days.

how do you pick your strikes? i know you do only a few stocks so i would assume you are comfortable just selecting strikes and timeframes that are optimal, etc... Do you do T/A or anything like that to select targets?

i had sworn off the idea of doing short term options through earnings but so many instances of people doing very well with those over the last few days. surprised by how commonly people are buying weeklies to gamble

I've been scalping contracts lately on high volatility stocks so I buy weeklies. I do quite poorly on longer timeframes. At first I was choosing ATM strikes because it was easier to calculate movement/gain ratio ($1 move=$0.50 gain) but have switched to 25Delta because the payout is greater. There's a lot more to it than choosing strikes - there are a series of checks I do on whether I buy puts or calls. As much as possible I try to remove guessing from the equation, i.e. there has to be several reasons why I make my choice rather than "I think it's gonna go up or down". ALL of the reasons are technical and almost never to do with macro and my entries are based on my set of signals, exits are based on signals/profit.

I'm constantly doing T&A, maybe 3 hours a day researching. But that's a low stress environment and I enjoy doing it. Constantly making notes and has probably tripled my win rate compared to before (a few years back) when I was buying contracts. I plot out pre-market high and low and in between those areas are generally my no-buy zones. I trade on momentum and go with it - I'm not interested in trying to catch the very top or very bottom. I will always, always try to leave money on the table.

^^^ unless there’s something I’m dramatically misunderstanding, the decision to roll your covered calls or to take assignment should be based on the outlook of the stock,

if I believe a stock is going to double in the next couple of months, as is the case with CLSK today it would not make sense to roll my $10 covered call, since I would be looking at a $50 profit per month or something like that, since the stock is already at about $13 and if I don’t want to take a loss I can only really roll to $10.50, it would make more sense to take assignment today and purchase new shares, which have an extremely good chance to make a lot more than $50 in profit in the next few weeks. Am I missing something?

P.s.
Speaking of Clean spark earnings, if you didn’t throw a few thousand in the premarket taking advantage of the 7 AM and 9:30 AM pop to quickly grab a 10% profit per day, you gotta look into that, this stuff is really predictable, makes me feel stupid for working. Worked hard for four hours yesterday, while this morning put in the buy order when I got up to pee at 6 AM, and a position sold by itself before breakfast, with profits significantly exceeding yesterday‘s work, this **** don’t even make sense.