How To Find The Best Stocks For The Wheel Strategy

[@rockwelltradingservices]

Did you enjoy this video? Let me know your thoughts in the comments below! New to Options Trading? Start here: kzbin.info/www/bejne/hKTTZH-fe7CYq6M

[@onuberonly7846]

Your notes are the best

[@rockwelltradingservices]

Thank you for watching!

[@maxlys]

Hello, thank you for this informative video, But what are your selection criteria for the Premium annualized, green, orange, red? Thanks

[@jakewhite6518]

I ‘ll admit, I got a little giddy when I saw a new video dropped! I love your plain and simple criteria, Markus, either it fits, or it doesn’t. Thanks for another juicy one.

[@rockwelltradingservices]

Thank you, Jake White. Yes, I love to keep things simple especially when I trade. That is why I developed the PowerX Optimizer so that I do not have to do all the thinking. ;) Right now, the Power X Optimizer is only $1997 ($1,000 off). You can read about our updates and purchase it here: www.rockwelltrading.com/products/10-44-powerx-optimizer-mar22/?KZbin&PXO-&Markus& We also are running a special for April only. Refer a friend to our software and earn $500! Let me know if you'd like this link as well!

[@IroncladTrading]

Nice. Very detailed.

[@rockwelltradingservices]

Appreciate it! And nice name! How long have you been trading for?

[@IroncladTrading]

@@rockwelltradingservices Thanks. I have been trading for 5 years and following you as well.

[@rockwelltradingservices]

@@IroncladTrading Amazing. I liked your video on how to measure volatility and risk by the way.

[@IroncladTrading]

@@rockwelltradingservices Thank you so much Markus. I have been always fond of your videos. May be in future, we can show the PowerX to my subscribers or do something together. I will email you when ready.

[@rockwelltradingservices]

Sounds good! Looking forward to it.

[@himanshuvaishnav8510]

Marcus, great video. What parameters do you use for the correlation between the stocks?

[@WOLF91]

Very informative, thanks man

[@rockwelltradingservices]

You are welcome! :) By the way we are running a special for April only. Refer a friend to our software and earn $500! Here is the link to sign up www.rockwelltrading.com/register-referral-partner-500/?KZbin&PXO-&

[@diddly7309]

Is there a way to calculated annualised ROI without the optimizer? I appreciate why it's featured and relied on heavily in videos, but is it replicable manually? Thanks

[@rockwelltradingservices]

Sure! Here’s a simpler explanation for calculating annualized ROI and P/E ratios: Annualized ROI Calculation 1. What You Need: - Net Profit: The money you made after selling your investment. - Cost of Investment: How much you originally spent. - Days Held: How many days you kept the investment. 2. Formula: \[ \text{Annualized ROI} = \left( \frac{\text{Net Profit}}{\text{Cost of Investment}} ight) \times \frac{365}{\text{Days Held}} \times 100 \] 3. Example: - If you spent $10,000 and sold it for $12,000 after 180 days: - Net Profit = $12,000 - $10,000 = $2,000 - Annualized ROI = \(\left( \frac{2,000}{10,000} ight) \times \frac{365}{180} \times 100 = 40.56\%\) P/E Ratio Calculation 1. What You Need: - Market Price per Share: How much one share of the stock costs. - Earnings per Share (EPS): The company's profit divided by the number of shares. 2. Formula: \[ \text{P/E Ratio} = \frac{\text{Market Price per Share}}{\text{Earnings per Share (EPS)}} \] 3. Example: - If the stock price is $50 and the EPS is $5: - P/E Ratio = \(\frac{50}{5} = 10\) Summary You can calculate these numbers by using simple math. Just remember to keep track of your profits, costs, and how long you held your investment. If you have more questions, feel free to ask!

[@Twitch760]

I'm trading AMC right now due to high IV of the stock. A single contract with a strike of 15 just netted me 107.00.

[@ryanh4571]

Do you ever ask yourself why that is?

[@Twitch760]

@@ryanh4571 of course I know why but I might as well enjoy this while I still can. The company isn't going anywhere anytime soon.

[@matthaze7906]

Best tips out there. Any sale coming up for powerx?

[@rockwelltradingservices]

Thank you! You chose the perfect time to ask! Right now, the Power X Optimizer is only $1997 ($1,000 off). You can read about our updates and purchase it here: www.rockwelltrading.com/products/10-44-powerx-optimizer-mar22/?KZbin&PXO-&Markus& We also are running a special for April only. Refer a friend to our software and earn $500! Let me know if you'd like this link as well!

[@Giovannibattilani]

What about Ford ticker “F”?

[@rockwelltradingservices]

Looks too erratic for me. I prefer stocks that are moving sideways. Ford has been crazy: Up a lot and then crashing down. I believe other tickers are much better. Does this help?

[@omarghosn8655]

If you are selling puts/calls, do you factor in volatility? Because not all options are created equal...a TSLA will earn you more, but will be more volatile. Something like Macy's would be alot less volatile and earn you much less

[@gpan4180]

Really enjoyed your video. I was wondering for how many puts I can treat with my account size and how far out I should sell the put? Do we have any calculations that can best optimize how many contracts should be traded? For example, 10k, 25k and 50k?

[@rockwelltradingservices]

Great question. I'm using the PowerX Optimizer to calculate the number of contracts I need to trade based on my account size. In a nutshell: Buying Power / 5 / (Strike Price * 100) Does this help?

[@InnerPathPilgrim]

Hi Markus. Regarding your annual profit calculation, do you use return on capital or return on risk capital? Thanks, Matt.

[@rockwelltradingservices]

I use "return on capital" that I need for the trade. Since I'm selling puts, you might consider that the "risk capital". Does this help?

[@InnerPathPilgrim]

@@rockwelltradingservices Yes, thank you Markus.

[@fantaztic885]

For 2024 what’s the best stocks?

[@rockwelltradingservices]

Do you have the PowerX Optimizer? You don't need to seek stock tips or inquire about top stocks for the year when you have a tool that can help you identify the stocks to trade.

[@cjgino311]

Very curious why PXO calculator had annualized premiums increasing as the days go by. When I enter trade at 30% annualized and a few days go by, now it says a much higher profit in orange. Reason for this?

[@rockwelltradingservices]

Great question: Right now, we're not "locking in" the days when you sold it. We are planning to do that in one of the upcoming releases. Stay tuned!

[@ge_song5]

@rockwelltradingservices why do you want stocks pay dividends? you're not going to keep them for long term anyway.

[@rockwelltradingservices]

Investing in dividend-paying stocks can be appealing for several reasons, even if you don't plan to hold them for the long term: 1. Income Generation: Dividend stocks provide a steady stream of income, which can be beneficial for short-term traders looking to enhance their returns. 2. Total Return: Even if you're not holding stocks long-term, dividends contribute to the total return of your investment. This means you can benefit from both price appreciation and dividend payments. 3. Market Volatility: In volatile markets, dividend-paying stocks can offer a cushion against price declines. The income from dividends can help offset potential losses. 4. Reinvestment Opportunities: Dividends can be reinvested into more shares, allowing for compounding returns, even over a short time frame. 5. Stock Selection: Companies that consistently pay dividends often have stable earnings and a solid financial foundation, which can be indicators of a good investment, even for short-term trading strategies. 6. Flexibility: Holding dividend stocks, even briefly, allows traders to capitalize on both the dividend payout and potential price movements. In summary, even if the intention is not to hold stocks long-term, dividends can enhance overall returns and provide additional benefits in various market conditions.

[@ge_song5]

@@rockwelltradingservices Thank you for taking the time to answer my question! For the wheel strategy, you don’t know when you will be assigned to sell or buy the underlying stocks, nor do you know if you will hold the stock during the ex-dividend date. Should you avoid dividend stocks for the wheel strategy?

[@rockwelltradingservices]

While it is true that the Wheel Strategy involves uncertainty regarding assignment and the timing of holding stocks, there are still valid reasons to consider dividend-paying stocks within this strategy: 1. Potential for Income: If you are assigned shares, owning dividend-paying stocks can provide you with income through dividends, which can enhance your overall return. 2. Long-Term Value: Dividend-paying stocks are often from established companies with strong fundamentals. This can add a layer of stability to your portfolio, even if you are primarily focused on short-term trades. 3. Ex-Dividend Date Considerations: While you cannot predict exactly when you will be assigned, you can choose to avoid selling puts or calls around ex-dividend dates if you prefer not to deal with the complications that may arise. This allows you to mitigate the risk of being assigned just before the ex-dividend date. 4. Strategy Flexibility: The Wheel Strategy can be adapted to include dividend stocks while managing your risk. For example, you can select stocks with favorable dividend payout schedules and incorporate that knowledge into your trading decisions. 5. Rescue Missions: If you find yourself holding a stock that pays dividends, you can utilize the rescue mission strategy to lower your cost basis, which can be beneficial if the stock price declines. Conclusion: While there are considerations to keep in mind, avoiding dividend stocks entirely in the Wheel Strategy is not necessary. Instead, you can approach dividend stocks strategically, taking into account their potential benefits and managing the risks associated with assignment and ex-dividend dates.

[@alexandermuchnik1652]

Thanks for the cool recommendations! Do you trade cryptocurrency options?

[@rockwelltradingservices]

I didn't know that there are options on cryptocurrencies. Where can you trade those?

[@audi88]

@@rockwelltradingservices Probably trade stocks which are into bitcoin mining like RIOT, MARA as they have high correlation with BTC. Actually these stocks are quite opposite to what you just taught, i.e. these are non-value, highly volatile, non-dividend stocks, and not ideal to trade if you want peace in life. :)

[@Chackalisimo]

You have a beautiful hair, sir

[@rockwelltradingservices]

Markus loves taking care of his hair. ;) Is this your first time in this channel? I hope that this video helps.

[@consciousnesspuppies5941]

$2,000 per year? Ouch!