This is my preferred approach as of now. This could get sone news and make a big move up.
Sure, selling at 50 when it’s 80 will burn. But. Like you say. Hard to be made at a double.
I also think the dilution has taken some of the steam out of the tank. Hopefully the MMs insist on jacking up the premium for a bit longer.
I guess the benefit there is locking in the high IV at that time for that long period.
Friday had a huge drop on the IV/prem so now it’s not as profitable.
I can see how fighting that each week or more frequently can be challenging or reduce the effectiveness.
A big concern I have going so far out on GME is getting caught in a quick rise that actually holds and not being able to take profit on those shares for an extended periods.
What is your approach or perspective on that situation?
The premiums for $GME are insane. I wasn’t even looking. Selling covered calls on that could be a very good strategy right now. ATM strikes going for $200 that expire in 7 days which is ridiculous. Only problem is if it tanks….. could take forever to stop being a bag holder
I was watching its movement post the 2nd offering and was surprised by the strength. IMO the risk of an outsized downside move that leaves me with no room to react is as small as other more volatile stocks. It helps that GME is beta negative so I don't have to be concerned about market headwinds as much.
Gme is a ticking time bomb. Sure the premiums are juicy but when it tanks, you're not going to recover from the bags you're holding if you're selling Ps or wheeling.
It's a stock that swings 100% over a day and is up 200% from a month ago. I don't even trust the greeks on this stock given its a largely pure feel good meme stock. If you can time it right, it's great but for thetagang, it's not something I would want to touch.
Can you explain this to me as a newb? Are you saying you get 15% return on your collateral weekly be selling puts at that delta? What is the 3-4% return on collateral?
Break even of underlying is -15%.
So say stock is $100.
They getting paid $3-4 on put.
But the strike is like $87.
So stock would need to drop 15% ish for them to be losing…but stock like GME could drop 30% or more in a week and who knows how long you’ll have to hold the bags/wheel until you can get out of it.
Sure 3-4% weekly is nice, but that’s the risk…
You could settle for 1-2% without such downside risk.
GME is good for uncovered calls. Wouldn't want to own that dogshit co with a ten foot pole.
PLTR is a good long term tech business - best moat since breaking into those govt/military contracts is next to impossible and they're getting lot of corporate clients as well.
HIMS is interesting. I could see it continuing to grow a lot since they only offer a limited amount of popular drugs right now. Most consumers don't seem to understand they can just get the same prescriptions they get on Hims from their PCP for like a quarter of the price they spend on Hims.
I sold uncovered calls well OTM when it did rocket again and made a ton of money. If you’re selling ATM on a meme stock you’re dumb. I can’t tell people how to trade though.
All I know is when a terrible business goes up, it must come down, mean reversion is a thing. Of course the execs capitalized off that by issuing more stock. It was never going to $1000 or whatever the “apes” think it’s going to be
HIMS took off because of the news of them releasing weight loss drugs this summer. I’ve personally used their topical finasteride spray and it’s pretty convenient. I do think there’s a market for convenience but it probably wouldn’t fare well in a market downturn.
Just buy the stocks you want to hold long term and sell CC's for a little extra income. Don't buy stocks you don't believe in just to sell CC's for pennies.
MO and VZ, They pop and drop a lot. Be patient and write on large up day(s). Close at 50% of premium received. Receive a nice dividend for holding the stock in addition.
I've made an actual shitload off GME, that sweet sweet IV will make everything else pale, like I've made gains that are almost WSB worthy this year selling boring old CC's? the hell man
Seriously, those that you would not mind holding for a time if they dropped and ideally move in a range.
Stocks that move in a neutral range or slightly bullish are better than those that drop or rocket higher.
Do a scan for stocks in your price range and then research the list to find those you think are good to hold and which would be good to trade CCs on . . .
I’m about to start implementing this on GME as it’s been clearly stated that the premiums are intentionally priced high.
Seems like a good opportunity as some others have pointed out.
Was not the best day to sell but I went all in myself. Probably should have been more patient for a spike next week. But you Just never know.
I took a few different strikes but essentially avg around 50. I’d be fine getting called. Lol.
Yes, same here. I was impatient to do something because my allocation was tied up in general by mid morning. And I wrote literally one, ha ha. Pretty far OTM, but they are the only shares I have that I truly don’t care if they get called away. I did two weeks out, so hope to close out next week and for an increase in share price. But honestly, just continuing that until they spike above strike, for a few hundred a week seems like a silly easy win. I’ve hardly written before (started as a buyer,) so after paper trading, wanted my test to be on something that I would sell anyway. Learning all sorts of things, ha ha.
Sounds like a good approach.
I’ve decided to go with just the weekly 7 day out as I figure decay will be more significant and less likely to get caught in a midway trap.
Since I’m putting up a significant amount I don’t want to end up early on with the premium up to a level I don’t want to buy back at for more than a week.
Not sure if this is optimal but seems like I’ll have a natural reset so I can roll into a better position faster.
Or, just have my shares called and cash out.
Great points! I may well emulate you on that. It’s clear what the risks are, but I wasn’t clear yet on how to mitigate them. Struck a compromise on first trial, but that sounds wiser.
It’s less management further out for sure.
I think with a less volatile stock further out would be good. But w GME I want to stay nimble.
I’m also keeping my goal to about 50% gain and may close then for a reposition.
I’m still evaluating and learning as well.
Would like to hear from any others who are more experienced and how they optimize.
I’m also trying to be disciplined and going way out. Beyond the common .2 delta.
I’m using my desired sell price as my threshold. So. It’s a win win situation, for the most part.
Same across the board. 50% to close. Which I learned here. There are a few posts about selling on GME specifically here and on the options sub. Maybe can check those out if someone more experienced doesn’t chime in here.
It depends on your goals for the overall position and whether you are wanting to hold on to the shares or willing to let them go.
I like selling covered calls on something that pays a dividend. I set the expiration pretty far out of the money and after the ex dividend date, then roll it. The calls are a booster. You can improve your position three ways, 1) premium from the calls, 2) dividend reinvestment and 3) capital gains.
In my own accounts, WBA, VZ and T are working ok. I've lost capital value on WBA (unrealized loss since I still own the shares), but the dividend reinvestment and options premiums have made up for it, so even though the price has declined, the position is just about to become profitable anyway.
If you have just a little more to work with, SCHD is another good underlying for safe options strategies.
Someone in the forum said that he was selling BITO CCs because its monthly dividends are ridiculously high! I just bought 100 shares and holding it until next month for dividends where I will re-assess whether to sell CCs or not.
Holy shit, a 20% dividend isn’t usually a good sign but a quick skim makes it seem like an OK etf
I wouldn’t normally touch crypto, but since it seems to spike when the real markets tumbles, it seems like a good idea to leave some money there, sell it during FUD, then move the proceeds back to the real markets while they’re done, if that makes sense?
But I feel like with my luck, it’ll crash as soon as I buy some.
OP asked for a stock recommendation to write covered calls on, and you suggested one you don't know much about? Lol
A lot of action, meaning what? The 700 options traded or million and a half shares today?
You held it for years? Did you make money off it? Cause that window is like 15-16 months if you timed it perfectly..
I think WHR is an interesting stock if you are willing to go out of price range, but it is probably worth discussing:
As example, key stats on Jul 19 $92.5 calls:
Implied volatility 37.82%
Delta 0.4056
Theta -0.0713
The make or break on WHR is that it pays an almost 8% dividend. If you listen to their earnings call and if you read their investor day material, they have a capital plan that has the dividend right up front, and they seem very dedicated to the dividend. From their call:
>We remain firmly committed to returning value to our shareholders and continued our nearly 70-year track record of steady or increasing dividends by recently declaring a dividend of $1.75 to be paid in the second quarter, putting us on track to deliver $400 million of dividends for the year.
They also have been making opex cuts and divesting some businesses, so generally all the right type of stuff to keep the cash flow going.
With that written, WHR is way out of favor. They are very clear that housing is down, and their leverage is from new housing where they have a lot of share. They do have debt. The revenue has dropped like a rock after Covid, and they burned a ton of cash on the first quarter. Whirlpool is a classical cyclical play, so everybody is waiting for an interest rate cut, which will allow better debt refinancing and people buying or switching houses, when classically people like to buy or upgrade their appliances.
Since the stock has fallen so much, the question is "do I need to put a collar around this dog?" I would suggest that if you looked at most dividend stock, as long as the dividend is not cut, the 8% dividend is a collar. While there are a few companies that pay higher than 8% dividend, they are almost always energy, financial or distressed REITs. VZ is another example. When they got down to an 8% dividend, the stock finally found support.
Earning call is July 25th, so I would guess a move will happen one way or the other there. The first quarter was an upside on the EPS, but cash burn was at an all time high due to restructuring. If cash is okay, and if they hit expectations, the current level should be about the bottom due to the dividend.
INTC is great for safer CCs right now. A couple other blue chips that I like are PFE and F. But I'm a sucker for household names with a 5%+ dividend for selling CCs.
I don’t even study the charts or anything and I still make so much money trading, I just get my picks off this one guy on instagram lmao😂 I think his name is @dukestrading on instagram
Take your negative self somewhere else. I have been selling options for a year now. Just seeing others opinions or what they may be selling too. Don’t get your panties in a bunch buddy.
Off the top of my head, GME, PLTR, HIMS, HOOD I've only been selling GME since the IV is just too good... It really makes other options lackluster
What DTE and strikes are you selling?
Weekly at 0.2 - 0.3 delta. Last week when it was around 28 I sold puts at 24 and 25.
Damn that’s so risky
I sold some 27$ last week but I am still in the green. But they were completely me being very risky
Still less risky than put/call credit spreads haha. Perspective is all that matters.
Are you willing to hold the stock long term if you get assigned? Roaring kitty's calls are expiring tmrw
He sold them all last week and bought 4,001,000 shares. Lol
I’m fine with it as a glorified SPAC. As long as IV is high I will stay with it.
he has no calls.
check out the 40-50 strikes 1-2 weeks out. Usually you can get a couple bucks for them. And if you get called away you doubled the stock
What if it drops to 15?
Use the premium to average down. The company has 4b cash. That’s a fairly solid ground to stand on.
This is my preferred approach as of now. This could get sone news and make a big move up. Sure, selling at 50 when it’s 80 will burn. But. Like you say. Hard to be made at a double. I also think the dilution has taken some of the steam out of the tank. Hopefully the MMs insist on jacking up the premium for a bit longer.
Nice was checking out a couple of those listed too. Thanks for commenting.
HIMS has been rough on CCs with the latest runup. I've had to roll mine like 3 times now. Might be in for a pullback and consolidation soon though.
I’m looking to start this strategy myself. What is the sweet spot for durations in your experience?
I’ve been going 3-6 months out on mine getting nice premiums.
I guess the benefit there is locking in the high IV at that time for that long period. Friday had a huge drop on the IV/prem so now it’s not as profitable. I can see how fighting that each week or more frequently can be challenging or reduce the effectiveness. A big concern I have going so far out on GME is getting caught in a quick rise that actually holds and not being able to take profit on those shares for an extended periods. What is your approach or perspective on that situation?
The premiums for $GME are insane. I wasn’t even looking. Selling covered calls on that could be a very good strategy right now. ATM strikes going for $200 that expire in 7 days which is ridiculous. Only problem is if it tanks….. could take forever to stop being a bag holder
I was watching its movement post the 2nd offering and was surprised by the strength. IMO the risk of an outsized downside move that leaves me with no room to react is as small as other more volatile stocks. It helps that GME is beta negative so I don't have to be concerned about market headwinds as much.
Been cc-rolling PLTR for a while and using premiums to buy more underlying - just avoid earnings and S&P inclusion days
Gme is a ticking time bomb. Sure the premiums are juicy but when it tanks, you're not going to recover from the bags you're holding if you're selling Ps or wheeling.
Well, that's the risk. -15% a week is around breakeven if I look for 3-4% return on collateral and 0.2-0.3 delta.
It's a stock that swings 100% over a day and is up 200% from a month ago. I don't even trust the greeks on this stock given its a largely pure feel good meme stock. If you can time it right, it's great but for thetagang, it's not something I would want to touch.
Yeah. I'm just willing to take the risk that's all.
Can you explain this to me as a newb? Are you saying you get 15% return on your collateral weekly be selling puts at that delta? What is the 3-4% return on collateral?
Break even of underlying is -15%. So say stock is $100. They getting paid $3-4 on put. But the strike is like $87. So stock would need to drop 15% ish for them to be losing…but stock like GME could drop 30% or more in a week and who knows how long you’ll have to hold the bags/wheel until you can get out of it. Sure 3-4% weekly is nice, but that’s the risk… You could settle for 1-2% without such downside risk.
Premiums this week suck. Time to get out.
GME is good for uncovered calls. Wouldn't want to own that dogshit co with a ten foot pole. PLTR is a good long term tech business - best moat since breaking into those govt/military contracts is next to impossible and they're getting lot of corporate clients as well. HIMS is interesting. I could see it continuing to grow a lot since they only offer a limited amount of popular drugs right now. Most consumers don't seem to understand they can just get the same prescriptions they get on Hims from their PCP for like a quarter of the price they spend on Hims.
Good for uncovered calls? You could literally indebt your grandchildren if that shit rockets again
I sold uncovered calls well OTM when it did rocket again and made a ton of money. If you’re selling ATM on a meme stock you’re dumb. I can’t tell people how to trade though. All I know is when a terrible business goes up, it must come down, mean reversion is a thing. Of course the execs capitalized off that by issuing more stock. It was never going to $1000 or whatever the “apes” think it’s going to be
HIMS took off because of the news of them releasing weight loss drugs this summer. I’ve personally used their topical finasteride spray and it’s pretty convenient. I do think there’s a market for convenience but it probably wouldn’t fare well in a market downturn.
Just buy the stocks you want to hold long term and sell CC's for a little extra income. Don't buy stocks you don't believe in just to sell CC's for pennies.
This is why you should buy $IBRX because Dr. Pat will cure cancer and suck you off at the same time
MO and VZ, They pop and drop a lot. Be patient and write on large up day(s). Close at 50% of premium received. Receive a nice dividend for holding the stock in addition.
Thanks for posting
$ENVX $MARA $BITO
Love Mara for sure I already have that one goin.
Bito sell ccs a week before end of month those dividends have been obliterating the share price
I've made an actual shitload off GME, that sweet sweet IV will make everything else pale, like I've made gains that are almost WSB worthy this year selling boring old CC's? the hell man
Seriously, those that you would not mind holding for a time if they dropped and ideally move in a range. Stocks that move in a neutral range or slightly bullish are better than those that drop or rocket higher. Do a scan for stocks in your price range and then research the list to find those you think are good to hold and which would be good to trade CCs on . . .
NVAX.
Thank you for posting
As others have mentioned I would go to and IV screener and look for those white High Iv in your price range.
Any screeners you recommend? Just Barchart ?
I use etrade and they have screeners and studies. I also have my own code for this plugged into there api.
I’m about to start implementing this on GME as it’s been clearly stated that the premiums are intentionally priced high. Seems like a good opportunity as some others have pointed out.
I agreee very interested in this one now
Sold one for the first time today, testing it out. Crazy high premium. Didn’t go through with others after that!
Was not the best day to sell but I went all in myself. Probably should have been more patient for a spike next week. But you Just never know. I took a few different strikes but essentially avg around 50. I’d be fine getting called. Lol.
Yes, same here. I was impatient to do something because my allocation was tied up in general by mid morning. And I wrote literally one, ha ha. Pretty far OTM, but they are the only shares I have that I truly don’t care if they get called away. I did two weeks out, so hope to close out next week and for an increase in share price. But honestly, just continuing that until they spike above strike, for a few hundred a week seems like a silly easy win. I’ve hardly written before (started as a buyer,) so after paper trading, wanted my test to be on something that I would sell anyway. Learning all sorts of things, ha ha.
Sounds like a good approach. I’ve decided to go with just the weekly 7 day out as I figure decay will be more significant and less likely to get caught in a midway trap. Since I’m putting up a significant amount I don’t want to end up early on with the premium up to a level I don’t want to buy back at for more than a week. Not sure if this is optimal but seems like I’ll have a natural reset so I can roll into a better position faster. Or, just have my shares called and cash out.
Great points! I may well emulate you on that. It’s clear what the risks are, but I wasn’t clear yet on how to mitigate them. Struck a compromise on first trial, but that sounds wiser.
It’s less management further out for sure. I think with a less volatile stock further out would be good. But w GME I want to stay nimble. I’m also keeping my goal to about 50% gain and may close then for a reposition. I’m still evaluating and learning as well. Would like to hear from any others who are more experienced and how they optimize. I’m also trying to be disciplined and going way out. Beyond the common .2 delta. I’m using my desired sell price as my threshold. So. It’s a win win situation, for the most part.
Same across the board. 50% to close. Which I learned here. There are a few posts about selling on GME specifically here and on the options sub. Maybe can check those out if someone more experienced doesn’t chime in here.
Will check it out. Thanks for the info
nvdl
It depends on your goals for the overall position and whether you are wanting to hold on to the shares or willing to let them go. I like selling covered calls on something that pays a dividend. I set the expiration pretty far out of the money and after the ex dividend date, then roll it. The calls are a booster. You can improve your position three ways, 1) premium from the calls, 2) dividend reinvestment and 3) capital gains. In my own accounts, WBA, VZ and T are working ok. I've lost capital value on WBA (unrealized loss since I still own the shares), but the dividend reinvestment and options premiums have made up for it, so even though the price has declined, the position is just about to become profitable anyway. If you have just a little more to work with, SCHD is another good underlying for safe options strategies.
I appreciate your input!
I like dividend stocks for covered calls, as they have some inherent price stability. PBR, WU, T, VALE, are ones I hold in that price range.
Thanks for posting!
Someone in the forum said that he was selling BITO CCs because its monthly dividends are ridiculously high! I just bought 100 shares and holding it until next month for dividends where I will re-assess whether to sell CCs or not.
Holy shit, a 20% dividend isn’t usually a good sign but a quick skim makes it seem like an OK etf I wouldn’t normally touch crypto, but since it seems to spike when the real markets tumbles, it seems like a good idea to leave some money there, sell it during FUD, then move the proceeds back to the real markets while they’re done, if that makes sense? But I feel like with my luck, it’ll crash as soon as I buy some.
All I know is a made the mistake of buying leaps on bito HUGE mistake Those dividends are killing me
Not in your price range but Iv been making a killing on Tesla CC’s.
MSOS, under $8, my maryjane gamble....
Thanks for posting
Magic mushrooms. MNMD. It’s up a ridiculous amount. I don’t know much about it, just held a little for years with no action.
Also have MNMD - the thing I don’t like is that options are only monthly, not weekly
Zoom out.
I held it for years bro. I don’t even have any now. But there is a lot of action as of late. Quick money.
OP asked for a stock recommendation to write covered calls on, and you suggested one you don't know much about? Lol A lot of action, meaning what? The 700 options traded or million and a half shares today? You held it for years? Did you make money off it? Cause that window is like 15-16 months if you timed it perfectly..
I think WHR is an interesting stock if you are willing to go out of price range, but it is probably worth discussing: As example, key stats on Jul 19 $92.5 calls: Implied volatility 37.82% Delta 0.4056 Theta -0.0713 The make or break on WHR is that it pays an almost 8% dividend. If you listen to their earnings call and if you read their investor day material, they have a capital plan that has the dividend right up front, and they seem very dedicated to the dividend. From their call: >We remain firmly committed to returning value to our shareholders and continued our nearly 70-year track record of steady or increasing dividends by recently declaring a dividend of $1.75 to be paid in the second quarter, putting us on track to deliver $400 million of dividends for the year. They also have been making opex cuts and divesting some businesses, so generally all the right type of stuff to keep the cash flow going. With that written, WHR is way out of favor. They are very clear that housing is down, and their leverage is from new housing where they have a lot of share. They do have debt. The revenue has dropped like a rock after Covid, and they burned a ton of cash on the first quarter. Whirlpool is a classical cyclical play, so everybody is waiting for an interest rate cut, which will allow better debt refinancing and people buying or switching houses, when classically people like to buy or upgrade their appliances. Since the stock has fallen so much, the question is "do I need to put a collar around this dog?" I would suggest that if you looked at most dividend stock, as long as the dividend is not cut, the 8% dividend is a collar. While there are a few companies that pay higher than 8% dividend, they are almost always energy, financial or distressed REITs. VZ is another example. When they got down to an 8% dividend, the stock finally found support. Earning call is July 25th, so I would guess a move will happen one way or the other there. The first quarter was an upside on the EPS, but cash burn was at an all time high due to restructuring. If cash is okay, and if they hit expectations, the current level should be about the bottom due to the dividend.
IBRX
I been really enjoying Intel it just sits at 30-31 lol
Yep intel is one that I have right now going. I’m digging that and the dividend.
INTC is great for safer CCs right now. A couple other blue chips that I like are PFE and F. But I'm a sucker for household names with a 5%+ dividend for selling CCs.
TNA
The ones you do DD on?
I don’t even study the charts or anything and I still make so much money trading, I just get my picks off this one guy on instagram lmao😂 I think his name is @dukestrading on instagram
[удалено]
If you can't even figure out how to do an options screener you have no business selling options.
Take your negative self somewhere else. I have been selling options for a year now. Just seeing others opinions or what they may be selling too. Don’t get your panties in a bunch buddy.
Yeah and bringing literally nothing to the table yourself.
It's called asking a question, man. I personally found the comments useful so I appreciate that it was asked.
Thank you bro this is why we have a forum. Some peoples lives suck so bad they have to try to ruin others.