It's very much appreciated Prog. Hope the recovery is quick for you. Seems like everyone has been getting sick these last couple months with one thing or another
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Ok, here's a new strategy that I've been playing with and have had success, every trade has been profitable thus far. I'm only in my 4th week, so not claiming victory over the market. That's when the market takes a sledgehammer to your junk. It's in my good friend's IRA that she asked me to manage. I bought 100 shares of SMCI in late November or early December and have been selling a call above her purchase price weekly. She's averaged about $700 per week so far, which is great for a low risk play. She was called out last Friday at a much lower price than $350+, but she pocketed the premium and made a profit on her shares. Well today when the market opened way down and the RSI flashed buy/reversal on my 5 min chart, I bought the 100 shares back at $310. She already up on the shares but later during the day I sold the 1/19 $325C for $5.03, The call expires in 2 days and she booked $500 and if it gets called away, then she'll bank $1,500 + $500 premium. If it's below $325 and not called away then I'll pick when to write next week's call when it looks right next week. That call will also expire next week. It's actually kinda fun with minimal risk thus far and producing good ROI, imo. I know some can't buy 100 shrs of SMCI but you can paper trade it to get familiar with the strategy and be experienced when you can.
ETA: I'm only doing this with SMCI because their calls have a lot of juice.
ETA: I'm only doing this with SMCI because their calls have a lot of juice.
Bought it and its my next read.jagvocate said:
https://thegreattaking.com/
You're practically riding the wheel, except instead of selling a put up front you're purchasing outright on buy signals. Less waiting time to be assigned to sell the call, but less premium per rotation. Good job.
It won't work for all stocks because most don't have weekly premiums as rewarding as SMCI but it's been stress free, easy and profitable thus far. Imo, it'd be perfect for our clubhouse members that have stated that they don't have the time for daytrading and they don't need to subscribe to an expensive service. Covered calls are very conservative but SMCI option premiums payoff like it's not.Heineken-Ashi said:
You're practically riding the wheel, except instead of selling a put up front you're purchasing outright on buy signals. Less waiting time to be assigned to sell the call, but less premium per rotation. Good job.
Just throwing ideas out there for anyone that might be interested. I think you could have very good odds of doubling your money in a year by collecting premiums weekly and sometimes having it called away at a price higher than you purchased it. Now, extrapolate it out, imagine when you're able to use that profit to continue doing the same strategy but now it's with 200 shares and selling 2 calls weekly.
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I actually like that better because with the wheel when you sell puts at your buy signals, if you call it right you never get assigned the shares, and miss the move up you identified. This way seems to have less potential to miss upside
SMCI is a different animal due to it's small float, institutional involvement and volatility, and provides different ways to profit from it. The best part is that you're selling covered calls at strikes higher than your buy price so you profit whether it's called away or not. Then you can do it all over again the next week. You're not stressing or gambling so it doesn't keep you up at night.Charismatic Megafauna said:
I actually like that better because with the wheel when you sell puts at your buy signals, if you call it right you never get assigned the shares, and miss the move up you identified. This way seems to have less potential to miss upside
Feel better Prog! We need you at 100%! And quite the list…. Let's go shopping soon.
HoustonAg_2009 said:
Feel better Prog! We need you at 100%! And quite the list…. Let's go shopping soon.
Thank you and we will buy when more things line up.
I also want to let yall know I'm a daddy again. I'm a simple man but I treated myself and she's awesome.
ProgN said:
Ok, here's a new strategy that I've been playing with and have had success, every trade has been profitable thus far. I'm only in my 4th week, so not claiming victory over the market. That's when the market takes a sledgehammer to your junk. It's in my good friend's IRA that she asked me to manage. I bought 100 shares of SMCI in late November or early December and have been selling a call above her purchase price weekly. She's averaged about $700 per week so far, which is great for a low risk play. She was called out last Friday at a much lower price than $350+, but she pocketed the premium and made a profit on her shares. Well today when the market opened way down and the RSI flashed buy/reversal on my 5 min chart, I bought the 100 shares back at $310. She already up on the shares but later during the day I sold the 1/19 $325C for $5.03, The call expires in 2 days and she booked $500 and if it gets called away, then she'll bank $1,500 + $500 premium. If it's below $325 and not called away then I'll pick when to write next week's call when it looks right next week. That call will also expire next week. It's actually kinda fun with minimal risk thus far and producing good ROI, imo. I know some can't buy 100 shrs of SMCI but you can paper trade it to get familiar with the strategy and be experienced when you can.
ETA: I'm only doing this with SMCI because their calls have a lot of juice.
Interesting strategy--how do you protect the downside? Just an appropriate stop below purchase price? This approach relies on accurate buying signals, correct?
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ProgN said:HoustonAg_2009 said:
Feel better Prog! We need you at 100%! And quite the list…. Let's go shopping soon.
Thank you and we will buy when more things line up.
I also want to let yall know I'm a daddy again. I'm a simple man but I treated myself and she's awesome.
Love me some French bulldog!
Don't think you can rely on a stop with a call sold. Your shares are tied up.
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You could buy a protective put so if the bottom falls out you buy your call back for nothing and exercise the put
here's the gap you called yesterday...how you playing this? expecting a melt up for a few days? Cem Karsan the other day seemed to think we traditionally pullback over these days after vix expiry yesterday and before the big triple witching opex this friday based on fund flows...and was throwing out "stagflation" which kinda surprised me...Heineken-Ashi said:
If we gap up tomorrow, it could get fun through end of week and into early next week. Make sure you know your entry points on individual stocks you are watching. If it bottomed into your area today and shows signs of bouncing off, you know how to place your stops and your R/R could be tasty.
I went long 1 week on SPY calls near the end of the day yesterday hoping for the 476 level which should be a 2x. If we get a pullback from there I will likely enter again. My stop is B/E right now.
I've tried the strategy and works great until the stock falls away quickly. You can continue to buy and resell CC but you continue to lose your equity in doing so because you realize the loss. It becomes hard to make the equity back too because you are consistently capping your upside by selling the covered call.
To me it only works if you look at your original investment as an "engine" to churn cash flow (premium from selling call), but long term not an equity builder.
Just my 2 cents from seeing the highs and lows from doing it.
To me it only works if you look at your original investment as an "engine" to churn cash flow (premium from selling call), but long term not an equity builder.
Just my 2 cents from seeing the highs and lows from doing it.
Also be weary of juiced premiums. There's a reason you're getting $500 per con.
Charismatic Megafauna said:
You could buy a protective put so if the bottom falls out you buy your call back for nothing and exercise the put
so this is basically a collar then, correct?
Quote:
A collar position is created by buying (or owning) stock and by simultaneously buying protective puts and selling covered calls on a share-for-share basis. Usually, the call and put are out of the money. In the example, 100 shares are purchased (or owned), one out-of-the-money put is purchased and one
MARA sliding down some more. This going into the 15s?
SPY filled yesterday's gap...and now we have lift off...
Hopefully. Choppy action usually not indicative of the beginning of a move to new highs. We will see.EnronAg said:
SPY filled yesterday's gap...and now we have lift off...
Bear day traders getting crushed right now. Impressive stick save. Need it to continue to ES 4800 for my 2x on yesterday's calls.
wow, this move is just stupid though LOL
Almost at target. Switching to selling half and watching support at $475.20 level. If it breaks, I'll let go over the other half.
Might blow up in my face, but I threw a little into SAVE.
I can sell my position if you want it to skyrocket!M4 Benelli said:
MARA sliding down some more. This going into the 15s?
Boom!
Tight stop. No support below.Brian Earl Spilner said:
Might blow up in my face, but I threw a little into SAVE.
STOP 4.99, LIMIT 9.99
More boom
Anyone see some AH news on SMCI? It just launched higher in the last 5 mins.
Guidance raised for 2Q (they have 6/30 year-end so 2Q is 4Q for calendar year companies)ProgN said:
Anyone see some AH news on SMCI? It just launched higher in the last 5 mins.
Rev 3.6-3.65 Billion
EPS $4.90 - $5.05 per share
Average estimate per analyst was $4.52.
Now you know why premium was popping Prog. Probably anticipation of new guidance.
Nah, I've been watching this thing and options for a longtime. Their options are always juiced.Heineken-Ashi said:
Now you know why premium was popping Prog. Probably anticipation of new guidance.
Well, profit is capped for tomorrow if they are called away, but $2K in less than 48hrs isn't too shabby with no stress. Then I'll pick my re-entry one day next week when the 5min flashes go.
Told you it's fun even though it's just covered calls.
Thank you kind sir.AgCPA95 said:Guidance raised for 2Q (they have 6/30 year-end so 2Q is 4Q for calendar year companies)ProgN said:
Anyone see some AH news on SMCI? It just launched higher in the last 5 mins.
Rev 3.6-3.65 Billion
EPS $4.90 - $5.05 per share
Average estimate per analyst was $4.52.
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