The Wheel Options Strategy - 10 Step Wheel Trading Checklist (Episode 193)

[@rockwelltradingservices]

Sorry, I couldn't be here to host Coffee With Markus today, but I hoped you enjoyed today's episode with our head coach, Mark Hodge. If you have any comments or questions for me, leave them in the comments. Recommended Links & Videos: Wheel Strategy Playlist: kzbin.info/aero/PLBa3sAx-Io2nosgosERUhIZwzvIgD-3Vq Options 101 playlist: kzbin.info/aero/PLBa3sAx-Io2m6vWuLNRz4HHUErjO8H6N8 PowerX Strategy Playlist: kzbin.info/aero/PLBa3sAx-Io2l9ZV4s66J-uNkG6AJvhSPB Wheel book: www.rockwelltrading.com/wheelbook OR mybook.to/TheWheel PowerX Strategy Book: bit.ly/2wMQ7zW

[@jeffputnam9530]

Great job today Mark. As always good information to think about. And never a waste of time.

[@markhodge7157]

@@jeffputnam9530 Appreciate the comment Jeff. Great having you with me today!

[@mhassetmgmt7153]

Mark, great show and very informative. Thanks for filling in for Markus and sorry I missed it live!

[@rockwelltradingservices]

Thank you for watching! 😉

[@lawrence6075]

Mark, GReat Job ! I hope I have the opportunity to hear You on this cast again. Try not to let Others asking about Markus cause You to feel disrespected. I would actually like to intermittently hear both of You from time to time. People develop a comfort in hearing from a Person they have resonated with in the past. In this case Markus. Which I love Markus' content as well. With all that said, I really like the way You lay the info out. A +++ Mr. Hodge

[@allenhelms8192]

Mark, awesome content. I follow all of these steps in your checklist, but I have never considered the CALL premium if I get assigned. Seems so simple, but just had not thought it. Thanks for what you and Markus do. It is appreciated!

[@rockwelltradingservices]

😊 You are welcome! Thank you for tuning in.

[@omarbelmonte1124]

Thanks a lot Mark. Fabulous explanations.

[@rockwelltradingservices]

Thank you for watching! 😊

[@pichetudomprasert621]

Very good explanation in the Wheel Strategy.

[@rockwelltradingservices]

Mark is awesome! Thank you for watching! 😊

[@markhodge7157]

Glad it helped Pichet!

[@JosefTorkelsen]

Love the content. The 10 steps are really helpful.

[@rockwelltradingservices]

Awesome! I am glad that you like it. 😊

[@markhodge7157]

Thank you Josef!

[@enderalls]

Thank you and Chip

[@rockwelltradingservices]

Thank you for watching! 😊

[@markhodge7157]

Haha...he's a good trading buddy. ;)

[@mariocorrea5848]

Yes I loved today"s show the best Mark 's show so far no doubt. Great job Mark thank you from the bottom my heart. It was extremely informative you did not miss anything regarding how to dress up properly to jump on the wheel strategy especially the part we have to check the premium on the calls in case we get assigned. I will keep this video handy, it was a great analysis and great advises.

[@markhodge7157]

Glad you liked the show today Mario! Thanks for joining!!!

[@Christina6552]

Hey Mark, can you do a video in the members section on how to see if there is enough call premium assigned. I would love more information on what you look for. I got assigned on Pins and didn't realize there wasn't enough premium to sell calls. But would love to have spotted that before hand.

[@Christina6552]

@@steve99912 yeah I sold it a month ago… lol 😂 I made the mistake of playing during earnings

[@Christina6552]

@@steve99912 well I appreciate you sharing your strategy. Now I don’t mean to sound rude, but I just want to know where to look at to make sure there is enough call premium. I’m still very new to the strategy so I apologize if that question is elementary. Mostly looking for Mark to answer this.

[@markhodge7157]

I'll cover it in a member video or maybe in a future Coffee...but based on the question and comments, there are 2 things to consider here: 1) Call premium on stocks that you are looking to "wheel". 2) Selling calls on assigned stocks. A good rule of thumb is to make sure IV is 40% or higher on the options you are looking to sell. 40-80% (60-80% is great and if everything I mentioned in the video looks good and it just means more premium collected) but IV over 100% usually means it's a crazy one. In YOUR case, the IV would have been high and call premium would have looked nice when you sold your puts on PINS because of earnings coming up. :/ So this wouldn't have helped you here (seems you've learned to check for earnings now ;)). Once assigned, I would wait until call premium is available OR consider a partial rescue. Looks like PINS has had some decent support around and above $50.

[@Christina6552]

@@markhodge7157 thanks!

[@petewilliamson2609]

Ah...yes, we can hear

[@rockwelltradingservices]

Yay! Thank you for watching! 😊

[@MT-oh2pu]

HI Mark! how can you check if the call premium is or is not good, before getting assigned on the stock? tks (minute 34:17)

[@rockwelltradingservices]

We like to use the "Wheel Calculator" that we have built into PowerX Optimizer. And we want to see at least 30% annualized. Does this help?

[@MT-oh2pu]

@@rockwelltradingservices Tks Markus ! I suooosed that you had some Excel sheet

[@thrashercharged]

I'm not understanding how Annualized ROI in % is calculated? I'm looking at your options chain for EDIT at 29:15, market price for EDIT is $57.50, strike price is $40, premium is $0.25, DTE is 4 days, Annualized ROI is 46%. I understand the annualized premium % is (premium$/strike$)*(365/DTE) but that equals 57%. What's the calculation for ROI to get 46%? Thanks for anyone who can answer this!

[@rockwelltradingservices]

The calculation is as follows: (Total Premium / (Days to Expiration +1)) * 360 * / Strike Price, i.e. $0.25 / (4+1) * 360 / 40 Does this help?

[@thrashercharged]

@@rockwelltradingservices Yes! Sorry for my delay in replying, I didn't see the notification that you'd responded. The difference in my formula and yours is the +1 to the Days to Expiration (I didn't have the +1). You're adding 1 to the Days to Expiration to account for the present day, which I neglected to do! So thanks for taking the time to respond and correcting me!

[@thrashercharged]

@@rockwelltradingservices Oh, by the way, I think you must've meant 365 instead of 360 (for the days in a year) in your formula. Calculating the example values with 360 gives 45% while 365 gives 45.63% (i.e. 46%, the correct value). Thanks again for responding and setting me straight on the need to add +1 to the DTE to account for the present day.

[@alexzagariya2945]

Is Mark sold his RIDE? I did at 7.50 and its goong up more!!!!

[@aranyaknox8957]

Thank you. I loved the session! You can sub anytime.

[@rockwelltradingservices]

Awesome! Thank you for watching! :)

[@johncarilloiii7828]

Only loss this year was selling calls, 9 of them, below, like 4-5 strikes, below asnm price. Rationale was delta and OTM % .20 or 80%. Safe? All of them went up! Was tired of idling with no premium. Looked for education before doing this and found nothing. Went for it. Lesson learned. Do what Markus says, period, at or above asnm price or wait, wait, wait. The final insult was had I waited just three weeks I would have made the 3k I lost getting called away. Rest I rolled or bought back cheap.

[@rockwelltradingservices]

Thanks for sharing, John. I'm sure it will help others. 👍