Wheel Strategy Tips - How to "Fly Rescue Missions"

[@himanshuvaishnav8510]

You are all alone in your league; most industry "experts" are not willing to go this far, this deep. Thanks a milion.

[@rockwelltradingservices]

Thanks for the feedback. Much appreciated :-)

[@rockwelltradingservices]

If you need more wheel strategy tips or other info about trading the wheel option strategy, leave a comment below. Recommended Links & Videos: How To Find The Best Stocks For The Wheel (Last Video): kzbin.info/www/bejne/ql7dhIpprpWoicU The Wheel Strategy Playlist: kzbin.info/aero/PLBa3sAx-Io2nosgosERUhIZwzvIgD-3Vq How to find strong support and resistance: kzbin.info/www/bejne/kJyogKiNjJp6jMU Wheel Book Waitlist: www.rockwelltrading.com/wheelbook Rockwell Merchandise: store.rockwelltrading.com/

[@ts4426]

Future power x customer here once I obtain the funds. I truly appreciate the lengths you go to clearly teach and explain the concepts. I will master this strategy with your guidance. Thank you 🙏

[@rockwelltradingservices]

Awesome! We are excited to get you on board!

[@clintanderson4591]

You got my like for being honest with the "only puts at support at xxx". Liked for now. Just waiting on your other videos to subscribe, but you've got my attention Mark.

[@rockwelltradingservices]

Thanks, Clint. ;) I am Markus, Mark is my head coach in Rockwell Trading. I hope to see you in my next video.

[@youngzen_xyz]

a very helpful explanation strategy. I like all your videos hopefully you're in a good health🤗

[@rockwelltradingservices]

Thank you!

[@saimiride]

Hello! I'm starting to use the wheel strategy, and I'm learning a lot from you and your channel. Thank you so much for that. Your explanations are very clear, and it's a pleasure to follow you. I apologize for this question, and I hope you can forgive me, but in order to feel completely comfortable with your strategy, I need to understand why someone from the "Real pnl" channel claims to have your real data and says that you've been losing money since 2019 despite your strategies. I'm sorry if this question makes you uncomfortable, but I think it's an opportunity to address this issue. Thank you for your work, and have a great day!

[@rockwelltradingservices]

Hi Marc, due to the ongoing law suit we have against them we cannot make further comments about this matter. I hope that you understand. ;)

[@saimiride]

@@rockwelltradingservices yes I understand completely , of course .. sorry for the intrusion . Good luck

[@rockwelltradingservices]

No worries. ;)

[@cirqduchalet6375]

So, now that RIDE suffered an 18% decline the following day after this presentation, putting the stock well past 30% bellow assignment price, do you wait to see a bottom to sell additional puts to lower the cost basis? I have been learning from you! Thank you for sharing.

[@seansean7653]

Did you blow up your account?

[@tonymontana1846-i1l]

Started using the wheel strategy last month, have made $1600 in premiums! Stocks i used it on, MARA,SPCE, TLRY,CCIV !

[@rockwelltradingservices]

Awesome! Thank you for watching! :)

[@Nicolasdu5]

Is that some crazy stock

[@nghebao21]

This is awesome: DCA to lower the avg cost. Thanks a lot

[@rockwelltradingservices]

Awesome! ;) Thank you for watching!

[@francescocostantino9619]

@markus, several traders selling put options use to roll and only if it is not possible or convenient (small premium and long DTE) take assignement and sell calls. Why do you prefer non to roll?

[@VB-ho9kv]

Mr. Markus Love from INDIA can you please tell me which presenter software you are using in your videos.

[@NobleG-b4w]

Great Advice Thanks

[@rockwelltradingservices]

You are welcome! ;)

[@computerworx888]

@markus if my sell put is far out like 2 months and its on the 30% below strike price , Should I do the rescue mission or should I wait before doing the rescue mission? Just trying to clarify about the timeline portion. Thanks again for a wonderful presentation.

[@deter78jg]

Love it!! I'm currently rescuing my workhorse assignments after selling 3 put at 32 about 3 weeks ago. My average cost is now around 20. Still averaging down by selling ITM puts for higher premiums. Any thoughts about ITM puts when rescuing?

[@carloscamchang9497]

Hi, Wkhs is under 10...how is your trade? Sell all or keep it

[@carloscamchang9497]

@@williamdieffenbach3264 Only God Knows ...but there not rescue mission only R.I.P

[@sonny5982]

So is TQQQ a stock I shouldn’t trade ?

[@shaunrhine435]

What chart are you using to determine support? Daily, hourly? Monthly?

[@rockwelltradingservices]

I using the PowerX Optimizer. Do you want to learn more?

[@shaunrhine435]

@@rockwelltradingservices I would love too!

[@rockwelltradingservices]

Hi! This is Cristy, Markus's page admin. Here is the link to it powerxoptimizer.com/ since you are a subscriber I have a promo code for you to avail of a $2000 discount. Just type in "rockwellspecial" before you check out.

[@brandysoda8665]

Great re cap.On the examples from traders ,will be GREAT if u include WHEN they sold the puts.It doesn't make sense to critcize the trade if u don't know when it was sold.

[@rockwelltradingservices]

Awesome! Thank you for watching! :)

[@petkuscinta9797]

Even great high-quality stocks can go down for a long time (even if you sell at equal or lower than 100w EMA). For example, if you would sell puts in May 2008 you would have to wait almost an entire year for the stocks to recover to -30% and 4.5 years till they come back to the same level. When they crash down they all crash together not just one as they do tend to follow the SP500 curve.

[@pickup99]

You are so close to having engineered a professional quant trader strategy called “mean reversion” it’s almost scary. Do you know anything of multivariate ordinary least squares regression? Using that and the resulting standard deviations will give you much more pin-point accuracy in strike price selection.

[@rockwelltradingservices]

Hi there, I have absolutely no idea what " multivariate ordinary least squares regression" is but it sounds very intriguing! What is it and what does it do?

[@pickup99]

​@@rockwelltradingservices It gives a statistical average (rather than arithmetic average that we learned in school). Very briefly, it computes the average price of say AAPL, given the current value of (for example) the S&P 500, the current 10Y yield rate, the price of gold etc. If you calculate standard deviations from this average it can give you more accurate strike prices, rather than eye-balling support/resistance. It's one of the tool professional quants use to trade derivatives.You'll need to learn linear regression.

[@rockwelltradingservices]

Seems I need to dust off my math books. 😳 Thanks for the tip. 😀👍

[@FidelSantana87]

How is the option's annualized return calculated? I think it should be different depending on what you are doing, a Sell or a Call. Do you recommend any tools? Thanks!!

[@rockwelltradingservices]

I personally use my Wheel Calculator inside the "PowerX Optimizer". The formula is: ((Premium received/Days to Expiration)*360)/(Number of options * Strike Price) Does this help?

[@JigDPT]

How do you figure out if the premium you collect is at least 30% annualized?

[@elymanic3497]

Basic math, premium/Callateral Or about 2.5% monthly

[@masoudmokhtari8997]

Thanks Markus

[@rockwelltradingservices]

You are welcome! ;)

[@cristianooppo1230]

You'r the best.

[@rockwelltradingservices]

Thank you! :)

[@deivysh436]

Hi Markus, where can I find that Wheel calculator?

[@rockwelltradingservices]

It is available here www.rockwelltrading.com/products/the-option-income-wheel/

[@philippwun7187]

What if the stock tanked heavily, lets say 40% and you got assigned. Then its very likely that you will not have enough margin left to open new Puts with lower strikes? What would you do then? Lets say all underlyings tank by 40% due to a pandemic and you get assigned, you will not have any margin left for those new trades. What to do?

[@domingodelgado3944]

That’s why you always keep cash on the side just in case and don’t have to many positions open.

[@thomasd5488]

@Philipp Wün "Lets say all underlyings tank by 40% due to a pandemic and you get assigned," "What to do?" IF, on the day of expiration, the underlying is 40% below the puts strike, then don't let the put expire. Instead, roll the put down to the current stock price and out to a farther expiration date, to earn a net credit. This will actually LOWER your margin requirement, and you earn more premium. Just to help make this more clear, I'll use an example. Lets say you sold a 30 day, out of the money put on stock XXX, with a strike price of $100. At the time you sold the put, the stock price was $105. By expiration day, the stock price is $60 and if you let it expire, you would have to pay $100 a share for a stock that is currently worth $60. So don't let it expire. On expiration day, roll the put strike from $100 down to $55 with a 6 month expiration date, or however far out you need to go to earn a net credit. The margin requirement is almost cut in half. Even if you had a dozen different positions, this would save your bacon. If you are looking at the same experience we had in Feb 2020 to end of March 2020, then you know that most stocks recovered in less than 6 months, or were at least above their lows. Your $55 put strike would expire worthless. Problem solved. You survived the pandemic crash while making a few bucks, instead of blowing up your account.

[@tiaxi6779]

simple, you just need to rolling your put position by weekly or biweekly (whatever timeframe will give you more $premium/day) until the premium you got will cover the loss (even possibly cover the whole share assignment cost ), that is the easiest way , because the more share price is deep in the money, the more your put value will be.

[@da5731.]

How you see selling a leap call for brk 14 month at 10.5%

[@rockwelltradingservices]

Selling a 14-month LEAP call for Berkshire Hathaway at a 10.5% return is a way to earn income by selling the option and keeping the premium if the stock price doesn't reach the strike price by expiration. Assess the risks and rewards based on your market view and risk tolerance.

[@rginnis]

You still in RIDE Markus?

[@jesusramos778]

man I'm down 50% on a stock and I'm chillin, I already made enough covered calls premium and averaged down with more stocks to cover for them. I'd say I don't like selling puts cause the stock could go even lower and you'd be taking all that loss for maybe a ridiculous premium (Sold put premium)

[@mdg72584]

Rule number 1 is that it the stock is something you would not mind owning. You have to buy the stock or leap to sell the calls anyways, a put gets you into the stock at a discount compared to just buying it. This is like a options version of dollar cost averaging. The other option if you have a put in the money near expiration is to roll your position every week and claim that theta decay premium. You might be able to do this till the stock rebounds or till you made enough premium that you can roll down your position to get more premium near the money.

[@thomasd5488]

@Jesus Ramos "and averaged down with more stocks to cover for them. I'd say I don't like selling puts cause the stock could go even lower and you'd be taking all that loss" Do you mean the same loss you get when you buy more stock to cost average down? You need to think this through a little bit more. Sell weekly out of the money puts instead of buying more stock directly from the market. The puts earn you premium that lowers your cost basis. If the put expires in the money, you get the stock put to you at a price lower than what you would have paid for it at the time you sold the put. You also have the choice of not letting the stock get "put" on you, by rolling the put to a lower strike price and farther out expiration to earn a net credit (profit). This allows you to follow the stock price down and make money while doing it. Eventually the stock will find a bottom, and the put will expire out of the money. You don't have to accept a loss. That's what makes selling puts better than buying stocks directly from the market. If you buy a stock, you take a paper loss as the stock goes down. If you sell a put, you make money for selling it. Then, if the stock goes down, you roll the put down and out for more profit.

[@thomasingham2735]

Are RIDE not a "stupid" stock to trade? Look at the chart before you enter that trade, it look like GME haha

[@DigiTechLabs]

Plus If you use the premium you collected and bought more shares at the current price and then sold covered calls....you lowered your TCO no need to PANIC SELL.

[@okopnik]

If you have 40 lots of RIDE at a $21.50 basis, at $16.23 you're down >$5.25/share or$21,000+ overall. And your suggestion is to go long (by buying puts) 40 *more* lots, in a stock that has already crashed much more than you expected? The notional exposure for those puts, in case you get assigned on those as well, is another $46,000 (less the put premiums), so you'll have to deposit that much to cover. Nobody has that kind of free cash... because if you did, you'd put it to work earning money. These flying "rescue missions" are more of a fantasy than reality. Markus, you obviously understand options and do a great job of explaining the wheel - but it's NOT an ideal strategy for the kind of volatile/falling market that we have now. It does great - beats buy-and-hold by a good deal - in flat or rising markets, but seriously underperforms the S&P in this kind of economic climate. You should mention that instead of convincing people to jump on this bandwagon right now.

[@rockwelltradingservices]

After flying a rescue mission, my cost basis on RIDE is 11.86. And YES, I absolutely agree with you: Every trading strategy has risks! I did several videos explaining the risks of "The Wheel Strategy". One of the risks is "being stuck in a position", like I am in RIDE.

[@einfussganger]

6:02 How could you not instantly see that the strikes were an even $10 apart, so you add half $5 to the lower or take $5 from the upper to get the average???