DOUBLE Your Covered Call Income with One Simple Move

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Option and Stock Trading - My Life of Learning

Күн бұрын

Пікірлер: 45

@StockandOptionMyLifeOfLearning Жыл бұрын

💰 Join my Patreon to get access to all my Live Trade Alerts, Open Orders and Weekly Top 5 Stocks: www.patreon.com/mylifeoflearning ► Learn how to generate Monthly Cash Flow by Selling Options here: mylifeoflearning-randy.mykajabi.com/offers/EgeavtWJ 👉 Seeking Alpha has agreed to give my patrons and viewers a very Generous Discount. I was surprised they went as low as they did! If you'd like to check it out, here's my discounted affiliate link: www.sahg6dtr.com/B37MNP/R74QP/ 👉 TC2000 charts - use my discounted affiliate link to get a $25 discount on your first order of TC2000 charting service: www.tc2000.com/pricing/mylifeoflearning 🔔 Subscribe to this channel for Free stock and option trading Tips: kzbin.info 📺 Watch Next: PMCC and LEAPS Option trading: kzbin.info/aero/PL3j38I2YtGw3d2osU5O6XRHJ8-Wul2ZW7 My Option Trading eBook: 📕 Get a copy of my eBook "New Beginnings: The Option Trading Story" amzn.to/2OgXx58 📕 📈 Purchase My Spreadsheets (as seen in my videos): etsy.me/3HHq5ge

@brianciofani4698 Жыл бұрын

Killing it right now on AAPL PMCCs. 🎉🎉

@valleygreen8313 Жыл бұрын

Love the videos! thanks for the thorough overviews!

@deniskochnev4189 Жыл бұрын

great video. LEAP is a great strategy but more risky and takes more time to manage (in case of many positions it might be a nightmare). I prefer to keep stocks and sell covered calls. In anyway - it depends on your risk profile. In 2023 and 2024 - sell puts)))) The economy is getting worse...

@jasonreviews Жыл бұрын

can you do this on trading platform

@bfine1962 Жыл бұрын

Great video. Absolutely love your service. Why don't you do more of this strategy? Do you use delta to select the strike you sell? How do you manage a deep in the money covered call thats against you but you want to keep the stock?

@StockandOptionMyLifeOfLearning Жыл бұрын

Thank you. If we are trading in a higher dividend paying stock then I tend to like collecting the dividend. However if it's a lower paying dividend stock or a stock that doest pay a dividend, then I definitely lean towards this strategy. We have several that we are in right now and should probably do more of these especially on high open interest LEAPS options.

@bfine1962 Жыл бұрын

@@StockandOptionMyLifeOfLearning What about managing a deep in the money against you covered call?

@darrensteves Жыл бұрын

I'm generally a seller of options except for PMCC's. Are you concerned about theta decay and losing value if the stock price doesn't move going only 1 year out on the DITM LEAP option? I like to go closer to 2 years out since the cost is not much more and roll when it reaches 1 yr for a very low costs. Just curious about your thoughts on that. Great video thanks Randy!

@StockandOptionMyLifeOfLearning Жыл бұрын

Thank you. Great question! Like you, I almost always go 2 years out and roll at 1 year. There are exceptions to that, but when I’m doing a PMCC that’s what I typically do. If I’m buying a LEAPS that’s DITM, and there’s not really any time value/extrinsic value in it, then I’m not too concerned with theta decay because it’s really nonexistent. If I did buy an option that had a decent bit of theta figured into its value, then I would definitely consider theta decay into my decision. That would then probably push me towards trading a 2 year as compared to a 1 year LEAPS.

@StockandOptionMyLifeOfLearning Жыл бұрын

@jimmyjamesinc.8850 Жыл бұрын

Great video as usual. On the PMCC what was the expiry on it and did it expire with any value? The profit collected, was that solely from the covered calls you sold and the LEAPS ($15,000) a wash?

@StockandOptionMyLifeOfLearning Жыл бұрын

The long LEAPS call was approximately 1 year out. Since it was DITM there really wasn't any time value decay and there was $2.50 per share profit due to an increase in value.

@babycutezz5665 Жыл бұрын

What do you do when the stock price goes above your "naked" call at the expiration on PMCC? If it was a covered call, the stock would get called away. You could end up owning a short position since PMCC is considered "naked". Thanks

@StockandOptionMyLifeOfLearning Жыл бұрын

Great question! I touched on that scenario in the video at this time stamp 7:35 If I want to stay in a PMCC position then I just roll the short near term part of the PMCC out and up. If the position has done what I hoped it would, and I’m done, with it, then I just sell to close the long LEAPS call and buy to close the shorter near term call. Since the delta of our long LEAPS call would be really close to 1, its value would have gone up as the stock went up so the overall position would be a winner. Of course if a trader didn’t buy a LEAPS call with a delta really close to 1, then its value may not have gone up as much as the short term call they sold, if the stock were to go way past the short term call's strike price.

@dividenddepot Жыл бұрын

I know LAZ is among your go to list of put selling. Do you have a current position after the recent drop and trying to repair as I am?

@StockandOptionMyLifeOfLearning Жыл бұрын

Yes I do. I'm doing some repair strategies on it. That 6.94% dividend also helps.

@dividenddepot Жыл бұрын

@@StockandOptionMyLifeOfLearning I've watched some of your videos and rolling out and down to Sept is not an option unless I add extra contracts to the position. My original sell was at 32.

@dividenddepot Жыл бұрын

@@StockandOptionMyLifeOfLearning 2 quarters of losses has me concerned. Have not seen that in a number of years. It's broken all the recent support levels on my charts.

@dividenddepot Жыл бұрын

@@StockandOptionMyLifeOfLearning looks like a candidate to sell some calls against at 33 to collect some premium. That previous support might become resistance.

@dividenddepot Жыл бұрын

@@StockandOptionMyLifeOfLearning no dividend for me yet, but looks like I will be assigned for sure. Trying to roll down and out to the 30.00 to lower cost of assignment?

@maximnikulin6500 Жыл бұрын

What broker do you use to trade?

@StockandOptionMyLifeOfLearning Жыл бұрын

I currently like to use IBKR and ETrade.

@Mike_Affholder Жыл бұрын

This is a good strategy for stocks that should be going up, I think if you buy something that is chopping sideways you might get burnt on that leap losing value to theta deca wouldn't you.

@StockandOptionMyLifeOfLearning Жыл бұрын

If you buy a LEAPS call option that is DITM like the one I showed in this video, theta decay should be pretty much nonexistent because almost the entire value of the option is made up of intrinsic value. So you wouldn’t experience much or possibly any decay depending on how DITM the call you bought is. However, if you bought an option that wasn’t very far in the money, then you would want to keep an eye theta (time value/extrinsic value) decay because it would increase as the strike of your long LEAPS call gets closer and closer to at the money.

@Mike_Affholder Жыл бұрын

@@StockandOptionMyLifeOfLearning thank you good to know!

@df56gh4d5h Жыл бұрын

Would probably be a $15K loss in 2022. Have to be really careful buying calls. I prefer covered calls. I gain when the stock appreciates plus the premium. And if it gets challenged I can roll it up and out. Slow and consistent wins the race.

@StockandOptionMyLifeOfLearning Жыл бұрын

I totally agree that you need to be careful buying any investment including calls, puts, stocks and any other investment.

@barnabashd6723 Жыл бұрын

Wait a minute. The premium you would have paid on those leaps would have dwindled over the course of the year when you were selling the monthly’s. After a year, you would not have sold those (leaps, which are no longer leaps) at 16500.

@StockandOptionMyLifeOfLearning Жыл бұрын

Actually, that’s not correct. The LEAPS call was DITM so there would be no time value, it was all intrinsic value.

@macman231 Жыл бұрын

Keep in mind the stock price appreciated from about 61.11 to 73.25 during that time, using close prices for the dates listed, that's a 19.8% gain. Yes the leap will lose extrinsic value but if he started with a 70 or higher delta then I could see leap appreciation faster than extrinsic decay. Seeing his claim of a 30% win using PMCC vs 19.8% stock appreciation it really didn't do that great since the options in O aren't that rich so I could see his claims as real. His spreadsheet shows he bought the leap for $25 and sold it for $27.50 so if his numbers are real, maybe he can verify.

@louis20122 Жыл бұрын

Still looking for a guaranteed risk free and simple covered calls strategy lol

@StockandOptionMyLifeOfLearning Жыл бұрын

If you haven't seen this video, it might help you get closer or it'd at least give you protection: kzbin.info/www/bejne/b2KToZZqjMd6iNU

@jamescofran777 Жыл бұрын

IMO not worth the added risk.

@StockandOptionMyLifeOfLearning Жыл бұрын

Thank you for sharing your thoughts 👍

@Neshotosam Жыл бұрын

Love your vids but PLEASE pronounce the word realty with only two syllables. Reel-tee, not reel-i-ee.

@StockandOptionMyLifeOfLearning Жыл бұрын

Hey thank you for the vocabulary lesson. It was always one of my tougher subjects in school.

@thomasd5488 Жыл бұрын

@@StockandOptionMyLifeOfLearning My fifth grade English teacher has joined the chat. I'd rather be a successful option seller, than a successful orator. LOL