I have been trading stocks since 1986. The wheel strategy works. I have made far more money over the decades with options trading than I ever did with stock. So much so that I could retire early.
I’m a new investor since Feb 2021 and just learned about the options wheel last month. It’s been very fun to do. Collecting $1800 premium on selling 2 puts expiring 9/10 was so satisfying today. Good to know this works and one could retire early using the method.
I'm 6 month into wheel options. I loved it so much that I used my HELOC to go all into wheel strategy. It's a better cash flow than rental property and deal with no tenants lol
Hi Red, mind chatting for a bit? I'm an experienced stock market investor but have only recently been in options. I'd prefer to talk with a mature experienced person rather than someone hyping their options trading results. Let me know if we can co next for a bit. Thanks.
It is not exaggerating to say that this is a life changing video, this is not a click bait video. I just started my wheel strategy n covered call last week, and I can feel the win rate is >80% compared to purely buy call or buy put. Bro Henry, thank you.
I like it that you were showing your real time balance and it was a loss for the day. Losses are part of the business and too many UA-camrs only show their gains...as for the strategy, it's good but you do have to have a large account to trade multiple cash secured puts. Also good to use Technical Analysis to pick strikes in area of support, 50 day Moving average, daily or weekly trendline etc.
It's worth pointing out that you should always pick a stock with strong fundamentals if you want to wheel. The danger of Wheeling is that if the stock crashes you won't be able to collect the premium you would normally because the stock has gone well below your strike price. This actually happened to me when I was chasing IV and high premiums. The stock price cut in half I was assigned at a very high price and it took me several months to get out of my position without losing money.
Great content Henry, I think you should also spend more time talking about the risks a.k.a. what to do if youre assigned after selling a put and for example the stock begins to tank. This is a scenario worth discussing to further educate anyone watching
You can continue selling covered calls and collecting some premium until the stock recovers- if you anticipate that the market won’t recover much and want to take a little risk to make that weekly premium income, you can try doing a covered call strike closer to the stock price even though you know the stock won’t hit that price anytime soon. Let say you sold a put for 850 on TSLA and the stock price was at 845 at expiration so you got assigned, and then it continues to plummet down to 780 the next week. Since I’m stuck with 100 stocks at 850, but I still want covered call premium, I can either sell covered calls at 850 and collect a lower premium or maybe I will take a little risk and sell a covered call at an 810 strike (closer to current stock price) if I think the stock isn’t going to recover that soon but I want more premium in the meanwhile. Of course I will hope TSLA will not reach 810 by that week’s expiration so I don’t get exercised on that 810 strike (having 100 shares at 850 would be a loss to be exercised at 810)
The premium give you some cushion and also you are getting the stock assigned to you at a lower price. The stock would have the potential of revisiting that price. Also only do puts on good companies that pay dividends and have longevity .
Totally. You put in a putsell on a $17 stock and it drops $4 that week. Now what?? Sell call at $17 and get $4 premium or sell call at $15 get a good premium have the stock called and be down $200 minus premiums collected?? Never mentions that.
Ive come to find, that these videos arent really to educate but really only to get views.. they never go over the OH SHIT scenerios that occur more than they dont. Very poor education
Exactly my same strategy! I noticed the 575 strike for TSLA is the same expiration week as earnings. Please give your audience a heads up that premiums are way higher because of implied volatility with earnings. Also mention margin and buying power to buy stocks. A+ content!
Thank you Henry. I was waiting for your video discussing selling calls and puts on TSLA. I hope to get there someday. My goal now is to find a stock that I like that has similar volatility to TSLA.
First, i Iove your vidoes! I’ve learned so much in the last year and i thank you. Quick question… do you know of any online website that you can use to track all of your options trade so you can see how much money you are making instead of using a spreadsheet? Thank you
I lost so much of money in naked call options the only horse that is running is covered calls on PLTR. Now, decided to stick to selling puts and repeat covered calls until is it assigned. The money you make won’t be high as compared yo naked calls but the good thing here is you own the stock and have power to think when to do what w/o worrying time decay and expiring
Thanks for the detailed vid but you forgot to mention that your 3 TSLA examples require approx $1M in available capital. What other "affordable" stock has decent volatility?
Thanks brother. You make it easy. I'm positive that I am not the only one who is very grateful that you take the time to do this... God bless, and be well. Thanks again
Well, OTLY is around $6.50 now, more than 60% below your target price. I don´t know how well this stragegy has worked in this case. Can you recover the losses by collecting premiums? How long would that take?
Hey, love your channel. What are you doing if the stock price is dropping after you bought it with the put? If you sell OTM calls the primume will be very low if the price is dropping down.
In this situation I would imagine that the upside is that you'd get to own the stock at that low price. It's why doing the Wheel is best on stocks that you'd want to own. As the price drops, you could buy more shares to lower your average price even more and wait for your bias to happen - that the stock would eventually rally. Even better if this stock you like is a high dividend stock, because then you'd make dividends on owning the 100 shares while waiting for the stock to rally.
I only do the wheel in stocks that i wan to own, If the price drop I may sell cover calls with monthly expiration to get more premium and sell cash secure puts at a lower strike to average down
So much good information here. I'm surprised people like my coworkers don't even bother to learn this to retire... My coworker thinks ONLY way to retire is to win the lottery...
Yup my coworkers think I’m crazy when I tell them I only need 200k in a margin account to stop working. I’m wheeling 40k now with margin and make $800-1k a week. Let them not believe man we need ppl to by the products we invest in 😂
I appreciate the teaching and explanations, but some of the stock pics are wayyyy down since this video was made about 2 years ago. OTLY is trading today for around $1.27, it was as low as $0.54 recently. In this video the recommendation is to get this stock for around $17-20 as a "good deal". The same with NIO, though it might rise again, its current price is around $7.50-$8. This stock was around $60 two years ago. Both of these stocks have been dropping like a rock since around two years ago, NIO was suggested as a "great deal" around $40-$42. If you have traded these stocks for the past 2 years, you would have certainly lost a lot of money...
quick question, when do a weekly wheel strategy, does the option expire end of trading day friday? So is the best time to enter a contract either selling call or put is monday morning?
It’s a great strategy until you go under water on the stock. I own msft at a cost basis of 280. This week msft was down 260. Unless you risk getting called and loosing money on the stock. So two risks are while you are holding a stock it goes down to low to get premium on calls. Also while you are holding a covered call the stock shoots up and you loose that upside. Stocks with low iv don’t pay much premium and stocks with high iv typically make large moves due to high beta
Agreed. I'm watching this a year later, and I see OTLY (highlighted around the 6 minute mark) is now trading for $3.23. That's a lot lower than the $17.50 he wanted to own the stock. I've seen similar videos using examples like RIOT and MARA. Consistently running the wheel on those was supposed to make one particular UA-camr a millionaire. Those stocks are now a fraction of the price they were when those videos were made. I'm not shunning the idea, nor the people who provide this content, I'm just saying that there clearly is no magic bullet, and it's not always as easy as selling puts, then selling covered calls. If you're going to do this, pick good stocks (or better yet, ETFs) and only run this when trading above the 50 day MA.
What happens when the average cost is above the stock price. How do you sell a covered call then? Premium will be minimal? Example Average cost $20. Stock price 15? How’s does things work in this scenario?
What about taxes? If you take money out, would that be considered long term or short term gain? How does one keep track of what tax a certain amount taken out may end up?
I wonder if you made much money in the past year (now is June 2023) wheeling Palantir and Otlay since they are down so much now. I personally like to screen harder on stocks and once a stock is out of a sideway trading pattern, I would stop wheeling.
I have a query... Say for example if I sell put of GAP with strike price of 23 at 1.20 which is currently trading at 24.10 dollars. If the stock price decreases to 23.5 then put option premium is also going to increase right...? So may be it come around 1.5dollars assume.. then in this case do I need to pay 0.3 dollars additional when buying the stock at 23 dollars? Can you please help me in this? Thanks.
Nope...the price you will pay for the stock if you get assigned is the strike price. The price of the option on a day to day basis does not change anything.
You’re in big trouble. Shouldn’t have messed with the stock in the first place. Identifying the right stock for the strategy is key. OATLY financially has been losing money for 4 years… not the stock to run the strategy on.
Thank you so much for what I was looking for. There is only problem- it is difficult to find high volatility stock at reazonable price . I do not imply that Tesla unreasonably priced, far from that. But I'd like to operate in lower priced stocks. MB you have some suggestions? I think tech stocks, not social, would be less whimsy. Your instructions are easy fo follow at least you make it so.
Useful video. I agree with your thoughts. On the first stage of the wheel strategy when selling cash secured puts I sometimes use options screeners, e.g. CSP screener by 5greeks
@@InvestwithHenry Ha. Yepp (and I'm in the States .. not the UK). You give me (us) tips and help us so perhaps I can give you two right now. 'Mate' and 'Bloke' are 'sometimes' called for in typing online to folks (not many do it .. but once you start . you will have em in your back pocket at all times when needed). Take em .. use em .. jus don't do it all the time .. jus once in a while (because that could appear forced / uncool .. Trust me .. you will know when). Quick ex might be you asking me out of nowhere... 'Hey Ian .. Come on ..get it together and email me some stock picks already will ya!?". I'd respond ..'Gee .. I dunno Mate, I mean ... you are kina the stock Guru ... not me.. .. right-o?'). Thanks Henry
Hey Henry, if a stock you were assigned through a put drastically fell, would you move your expiration farther out to collect more premium or continue the weekly calls? Thanks
Idk what he would do, but what i do personally, i sell far out calls, to potentially lock in profits or break even. And if the stock keeps dropping you can always buy the calls back. Thats why the number one rule is to Pick a stock you don’t mind owning
Once you own the stock, You are going to have to go out farther, because you will not receive a decent premium if the stock is far below your strike price
Do you ever roll the stock into next week to prevent having it called away? Especially when it is barely over the strike price and is on an uptrend which generally means higher call premiums.
@@andrewhill7887 I buy to close the old option and sell to open a new option with a higher strike price and longer time to expiration. I only do it if I get credit betwen the purchase and the new option sale
You think CLOV and WISH and Riot might move up this week? Still want my capital to work for me .What covered calls would you sell if you had too ? ATM , OTM, or ITM?
For me, I always sell at +/- 10% no matter the premium is. It is safe enough to buy at discount in the put scenario or get enough profit in the call scenario with reasonable premium.
Lots of assumptions here, for instance if you get assigned the stock could continue to go down and negate any any gains you might make. It is true that you can continue to sell calls each week and as long as stock doesn’t go to zero you’ll eventually be able to sell the stock. But each week the stock goes down equal to or more than the value of the call you sell you’re not making any money that particular week. As far as stocks such as TSLA, you need a minimum $100,000 account if you get assigned even one contract at today’s price (over $1000/share). For smaller accounts it’s definitely more of a challenge because of the need for higher IV.
Much love, thanks for the video. Can you make a video of closing the transaction? aka Holding an Option Through the Expiration Date. Also I was sad that I didn't hear your outro song on this video :( i love it, gets me hyped (Every Battle - Hallman) haha
I'm sure you see were OTLY at now. There is risk with wheel strategy. If you are put eh stock at $17 and it drops to 6.93 now you can't sell calls because its below were you bought it.
OTLY is $1.27 today and it was actually lower. NIO is below $8. If anyone followed both of these "great pics" since when this video was made, they would go bankrupt
u need the capital in your account for 100 shares of whatever the strike price of the put u choose in case u get assigned for example if u want to sell a put with a $20 strike u would need to have at least $2000 in your account in order to do so
What if planter dropped to 15, then how can you sell calls on that? What if it stays at 15 and the 21.50 call doesn’t give any good premiums? Wouldn’t you be stuck with pltr for a long time until it gets back to 21.50?
That's the real risk here. If you start the wheel too high and catch a falling knife, it will take you a long time to recover only by premiums. His PLTR play makes sense though. It's basically been locked between 21 and 25 since March, so it's not a bad idea to sell puts around $20 strike price.
You said you usually sell options right at start of trading day around 9:30ish on Mondays. Is it better to wait a couple hours for market to settle for the day before selling options?
using a previous premium to lower your average price so the next option looks better doesn't sit well with me. I like to keep it simple so what I see in the account is what it is, and tracking is easier. Once i get the premium it's over and is profit. When i get assigned the shares eventually the avg price is the price i bought at which would be the strike. Then i sell a call based on that real price of the currently held shares so i'm not letting previous gains evaporate to make the next trade look better.
Robinhood does not exercise your option automatically, only the holder of that contract can do so before expiration. Robinhood will only automatically assign you to those shares if your put or call is in the money ITM
How far out are you usually buying options, Im buying a month or two out? I just started a few weeks back. I read up on how they work and started selling puts on stocks I wanted to own. I then came up with this smart idea to buy more then sell a call on it if I get put the shares. I keep thinking I am figuring out brilliant ideas as I look at the math of all of this and wondering if anyone has figured this out. Then I find out Im not really that smart, its already being done everyday my thousands of others, lol.
When did you start using this strategy and what was your portfolio value when you started? Does that near 1 million portfolio value you have now equate to only gains or have you added more cash?
I have been trading stocks since 1986. The wheel strategy works. I have made far more money over the decades with options trading than I ever did with stock. So much so that I could retire early.
I’m a new investor since Feb 2021 and just learned about the options wheel last month. It’s been very fun to do. Collecting $1800 premium on selling 2 puts expiring 9/10 was so satisfying today. Good to know this works and one could retire early using the method.
were you trading with $100?
Well done
I'm 6 month into wheel options. I loved it so much that I used my HELOC to go all into wheel strategy. It's a better cash flow than rental property and deal with no tenants lol
Hi Red, mind chatting for a bit? I'm an experienced stock market investor but have only recently been in options. I'd prefer to talk with a mature experienced person rather than someone hyping their options trading results. Let me know if we can co next for a bit. Thanks.
It is not exaggerating to say that this is a life changing video, this is not a click bait video. I just started my wheel strategy n covered call last week, and I can feel the win rate is >80% compared to purely buy call or buy put. Bro Henry, thank you.
I like it that you were showing your real time balance and it was a loss for the day. Losses are part of the business and too many UA-camrs only show their gains...as for the strategy, it's good but you do have to have a large account to trade multiple cash secured puts. Also good to use Technical Analysis to pick strikes in area of support, 50 day Moving average, daily or weekly trendline etc.
It's worth pointing out that you should always pick a stock with strong fundamentals if you want to wheel. The danger of Wheeling is that if the stock crashes you won't be able to collect the premium you would normally because the stock has gone well below your strike price. This actually happened to me when I was chasing IV and high premiums. The stock price cut in half I was assigned at a very high price and it took me several months to get out of my position without losing money.
Agreed
But you managed to get out without a loss? That's real nice.
Thats why you also pick a stock you dont mind owning for those exact reasons
true, this only works for stocks that have tendency to go up.
@@Maker004 And pays a dividend IF you hold it selling calls for a while. For me its FORD
Great content Henry, I think you should also spend more time talking about the risks a.k.a. what to do if youre assigned after selling a put and for example the stock begins to tank. This is a scenario worth discussing to further educate anyone watching
You can continue selling covered calls and collecting some premium until the stock recovers- if you anticipate that the market won’t recover much and want to take a little risk to make that weekly premium income, you can try doing a covered call strike closer to the stock price even though you know the stock won’t hit that price anytime soon. Let say you sold a put for 850 on TSLA and the stock price was at 845 at expiration so you got assigned, and then it continues to plummet down to 780 the next week. Since I’m stuck with 100 stocks at 850, but I still want covered call premium, I can either sell covered calls at 850 and collect a lower premium or maybe I will take a little risk and sell a covered call at an 810 strike (closer to current stock price) if I think the stock isn’t going to recover that soon but I want more premium in the meanwhile. Of course I will hope TSLA will not reach 810 by that week’s expiration so I don’t get exercised on that 810 strike (having 100 shares at 850 would be a loss to be exercised at 810)
The premium give you some cushion and also you are getting the stock assigned to you at a lower price. The stock would have the potential of revisiting that price.
Also only do puts on good companies that pay dividends and have longevity .
Totally. You put in a putsell on a $17 stock and it drops $4 that week. Now what?? Sell call at $17 and get $4 premium or sell call at $15 get a good premium have the stock called and be down $200 minus premiums collected?? Never mentions that.
Ive come to find, that these videos arent really to educate but really only to get views.. they never go over the OH SHIT scenerios that occur more than they dont. Very poor education
This comment sure aged well. Otly is at 6.97, PLTR 11.02 today 2/19
OMG! I did this all of May and went from 2500 to 4000
Can you please do the actual trades so we can physically see please. Thank you for your guidance
I’ve been trading tsla using the wheel strategy & I am currently earning $12,000 per month. Learn options!!! Henry makes it easy to understand
Boom! Love it!
@DaBooster how much capital locked in to earrn 12k monthly?
Thank you Henry for being very transparent with us.. your support is greatly appreciated😊
yeah the wheel is the hardest strat for me to understand by far, might need to look for simpler explanations to start off
Exactly my same strategy! I noticed the 575 strike for TSLA is the same expiration week as earnings. Please give your audience a heads up that premiums are way higher because of implied volatility with earnings. Also mention margin and buying power to buy stocks. A+ content!
Thank you Henry. I was waiting for your video discussing selling calls and puts on TSLA. I hope to get there someday. My goal now is to find a stock that I like that has similar volatility to TSLA.
I forgot to subtract the premium to determine the real average cost. You just increased my income!
This has been the easiest to understand video of yours I’ve seen so far. Excited to start putting it to work. Thank you for sharing.
First, i Iove your vidoes! I’ve learned so much in the last year and i thank you. Quick question… do you know of any online website that you can use to track all of your options trade so you can see how much money you are making instead of using a spreadsheet? Thank you
I lost so much of money in naked call options the only horse that is running is covered calls on PLTR. Now, decided to stick to selling puts and repeat covered calls until is it assigned. The money you make won’t be high as compared yo naked calls but the good thing here is you own the stock and have power to think when to do what w/o worrying time decay and expiring
I love the wheel strategy! I use this all the time, in addition to my long term dividends. Great video 👍
What stocks you use for your wheel❓️
Thanks for the detailed vid but you forgot to mention that your 3 TSLA examples require approx $1M in available capital. What other "affordable" stock has decent volatility?
Bitcoin mining stocks have excellent volatility. Personally I love MARA.
Ford, InfoSys, Agen, Abev
Yes. Walk us through the trades. I am new new to this. I need to follow you baby step by baby step!
It takes time to learn options but when you learn how they work and you have at least 3500-5000 this is the absolute best strategy
Thanks brother. You make it easy. I'm positive that I am not the only one who is very grateful that you take the time to do this... God bless, and be well. Thanks again
Well, OTLY is around $6.50 now, more than 60% below your target price. I don´t know how well this stragegy has worked in this case. Can you recover the losses by collecting premiums? How long would that take?
Hey, love your channel.
What are you doing if the stock price is dropping after you bought it with the put? If you sell OTM calls the primume will be very low if the price is dropping down.
I'm very interested in the answer as well. Because this seem to be the only downside of this strategy.
In this situation I would imagine that the upside is that you'd get to own the stock at that low price. It's why doing the Wheel is best on stocks that you'd want to own. As the price drops, you could buy more shares to lower your average price even more and wait for your bias to happen - that the stock would eventually rally. Even better if this stock you like is a high dividend stock, because then you'd make dividends on owning the 100 shares while waiting for the stock to rally.
I only do the wheel in stocks that i wan to own, If the price drop I may sell cover calls with monthly expiration to get more premium and sell cash secure puts at a lower strike to average down
I’m using a similar strategy with a portfolio valued at roughly 1.5 hundred dollars. I’m in a dip right now but looking for gains in the future!
Hey Henry what brokerage do you use for options trading for a roth IRA account?
Hindsight is 20/20 but man, you'd be crushed owning Oatley
So much good information here. I'm surprised people like my coworkers don't even bother to learn this to retire... My coworker thinks ONLY way to retire is to win the lottery...
Hahah tell them to watch my option playlist
Yup my coworkers think I’m crazy when I tell them I only need 200k in a margin account to stop working. I’m wheeling 40k now with margin and make $800-1k a week. Let them not believe man we need ppl to by the products we invest in 😂
@@domingodelgado3944 🤴
@@domingodelgado3944 this literally cannot go tits up
I wish there was a Love It button for this video. ❤️
This is the best video on the wheel strategy period. Keep the vids coming. Thanks Henry
I appreciate the teaching and explanations, but some of the stock pics are wayyyy down since this video was made about 2 years ago. OTLY is trading today for around $1.27, it was as low as $0.54 recently. In this video the recommendation is to get this stock for around $17-20 as a "good deal". The same with NIO, though it might rise again, its current price is around $7.50-$8. This stock was around $60 two years ago. Both of these stocks have been dropping like a rock since around two years ago, NIO was suggested as a "great deal" around $40-$42. If you have traded these stocks for the past 2 years, you would have certainly lost a lot of money...
OTLY is 1.63 today 5/31/2023
quick question, when do a weekly wheel strategy, does the option expire end of trading day friday? So is the best time to enter a contract either selling call or put is monday morning?
What is your target annual ROI? What is your tolerance for max drawdowns? How did your account performed during the Pandemic crash around March 2020?
FYI oatly is at 4 dollars a year later
0.83 rn ☠️
It’s a great strategy until you go under water on the stock. I own msft at a cost basis of 280. This week msft was down 260. Unless you risk getting called and loosing money on the stock. So two risks are while you are holding a stock it goes down to low to get premium on calls. Also while you are holding a covered call the stock shoots up and you loose that upside.
Stocks with low iv don’t pay much premium and stocks with high iv typically make large moves due to high beta
Agreed. I'm watching this a year later, and I see OTLY (highlighted around the 6 minute mark) is now trading for $3.23. That's a lot lower than the $17.50 he wanted to own the stock. I've seen similar videos using examples like RIOT and MARA. Consistently running the wheel on those was supposed to make one particular UA-camr a millionaire. Those stocks are now a fraction of the price they were when those videos were made. I'm not shunning the idea, nor the people who provide this content, I'm just saying that there clearly is no magic bullet, and it's not always as easy as selling puts, then selling covered calls. If you're going to do this, pick good stocks (or better yet, ETFs) and only run this when trading above the 50 day MA.
Keep selling 185 calls
Henry is the best options trading teacher on UA-cam!
Thank you :)
@Henry if Robinhood is not available for out of us users, can you recommend one that is similar??? Thanks
What happens when the average cost is above the stock price. How do you sell a covered call then? Premium will be minimal? Example Average cost $20. Stock price 15? How’s does things work in this scenario?
What about taxes? If you take money out, would that be considered long term or short term gain? How does one keep track of what tax a certain amount taken out may end up?
Hi Henry. What do you do if the stock drop big while you are selling covered calls?
Then he’s $%^&#@‘ed the same way as someone holding the bag, all because he tried to earn a few dollars.
Then he will be bag holding the stock in question while selling covered call to earn near zero premium or extend the DTE to infinity
@@lastempire7302 What is the solution in that case to lower your loss?
I wonder if you made much money in the past year (now is June 2023) wheeling Palantir and Otlay since they are down so much now. I personally like to screen harder on stocks and once a stock is out of a sideway trading pattern, I would stop wheeling.
Henry, I have a Roth IRA can I wheel it? Do you have any gotchas with this vehicle strategy combo? Man I'm learning so much from you. Thank you.
Yes
You are great teacher, I learned so many stock options techniques from this video, thank you so much
Good strategy for consistant income, the only draw back is, it needs a large capital to run it well.
You explain to people who already know because people who need to learn can't follow you at this speed
I have a playlist on options that's more basic. You should watch that
Hello you have a Roth account and do you think it’s a good I deal because you do so good I think what you doing is best
I have a query... Say for example if I sell put of GAP with strike price of 23 at 1.20 which is currently trading at 24.10 dollars. If the stock price decreases to 23.5 then put option premium is also going to increase right...? So may be it come around 1.5dollars assume.. then in this case do I need to pay 0.3 dollars additional when buying the stock at 23 dollars? Can you please help me in this? Thanks.
Nope...the price you will pay for the stock if you get assigned is the strike price. The price of the option on a day to day basis does not change anything.
oatly is at $4 today - what you do with wheel strategy when it falls from 17.5 to 4 in a year - risks to consider!
You’re in big trouble. Shouldn’t have messed with the stock in the first place. Identifying the right stock for the strategy is key. OATLY financially has been losing money for 4 years… not the stock to run the strategy on.
I'm starting the wheel strategy in my Roth IRA. Very excited!
Thank you so much for what I was looking for. There is only problem- it is difficult to find high volatility stock at reazonable price . I do not imply that Tesla unreasonably priced, far from that. But I'd like to operate in lower priced stocks. MB you have some suggestions? I think tech stocks, not social, would be less whimsy. Your instructions are easy fo follow at least you make it so.
Useful video. I agree with your thoughts. On the first stage of the wheel strategy when selling cash secured puts I sometimes use options screeners, e.g. CSP screener by 5greeks
did you explain the 7,000 loss for this day?
+1 who watches the video when Oatly is at $8 :)
Why you choose monday to write if i may ask? Just curious. TY
This was an excellent video. I now have a clear understanding of selling puts. This was awesome. Thank you!
I like listening to this bloke.
Haha haven't heard bloke in a while. Glad you are benefiting
@@InvestwithHenry Ha. Yepp (and I'm in the States .. not the UK). You give me (us) tips and help us so perhaps I can give you two right now. 'Mate' and 'Bloke' are 'sometimes' called for in typing online to folks (not many do it .. but once you start . you will have em in your back pocket at all times when needed). Take em .. use em .. jus don't do it all the time .. jus once in a while (because that could appear forced / uncool .. Trust me .. you will know when).
Quick ex might be you asking me out of nowhere... 'Hey Ian .. Come on ..get it together and email me some stock picks already will ya!?". I'd respond ..'Gee .. I dunno Mate, I mean ... you are kina the stock Guru ... not me.. .. right-o?').
Thanks Henry
Hey Henry, if a stock you were assigned through a put drastically fell, would you move your expiration farther out to collect more premium or continue the weekly calls? Thanks
Idk what he would do, but what i do personally, i sell far out calls, to potentially lock in profits or break even. And if the stock keeps dropping you can always buy the calls back.
Thats why the number one rule is to
Pick a stock you don’t mind owning
Once you own the stock, You are going to have to go out farther, because you will not receive a decent premium if the stock is far below your strike price
@@juananchhooo couldn't u just sell right otm puts n sell right otm calls n lock in good premium that way?
What is your opinion on closing out your put early if it went up in value and selling it a week out to get more premium faster?
Make sure to use all 4 wheels. If one wheel blow up, you still have 3 wheels to keep the car upright.
Hey are you buying puts to get in or selling puts to get in? I figured u need to buy a put to get the stock
Do you ever roll the stock into next week to prevent having it called away? Especially when it is barely over the strike price and is on an uptrend which generally means higher call premiums.
I roll my calls when I can get more premium or change the strike to a higher value, or when I rater wait to get 12+months to pay less taxes
@@gsabic rolling your call is essentially lengthening the decay?
@@andrewhill7887 I buy to close the old option and sell to open a new option with a higher strike price and longer time to expiration. I only do it if I get credit betwen the purchase and the new option sale
@@gsabic Thanks
Oatly shares are 0.8 usd now. What your view on it now?
Tlsa is at 183 today. How did you ride that down?
You think CLOV and WISH and Riot might move up this week? Still want my capital to work for me .What covered calls would you sell if you had too ? ATM , OTM, or ITM?
For me, I always sell at +/- 10% no matter the premium is. It is safe enough to buy at discount in the put scenario or get enough profit in the call scenario with reasonable premium.
OTLY currently trading right around $7.
Lots of assumptions here, for instance if you get assigned the stock could continue to go down and negate any any gains you might make. It is true that you can continue to sell calls each week and as long as stock doesn’t go to zero you’ll eventually be able to sell the stock. But each week the stock goes down equal to or more than the value of the call you sell you’re not making any money that particular week. As far as stocks such as TSLA, you need a minimum $100,000 account if you get assigned even one contract at today’s price (over $1000/share). For smaller accounts it’s definitely more of a challenge because of the need for higher IV.
This strategy sounds dope, can’t wait to apply it in real time!
I am curious what happened in case stock continue dropped and crash
You lose.
Much love, thanks for the video. Can you make a video of closing the transaction? aka Holding an Option Through the Expiration Date. Also I was sad that I didn't hear your outro song on this video :( i love it, gets me hyped (Every Battle - Hallman) haha
Henry, you are dropping some golden nuggets of knowledge here o YT. Along with Iron Condor, this wheel strategy is mind-blowing.
I'm sure you see were OTLY at now. There is risk with wheel strategy. If you are put eh stock at $17 and it drops to 6.93 now you can't sell calls because its below were you bought it.
OTLY is $1.27 today and it was actually lower. NIO is below $8. If anyone followed both of these "great pics" since when this video was made, they would go bankrupt
why is the goal to continue selling the puts and not getting assigned the stock?
This is just one form of the Wheel strategy. You definitely can get assigned stock if you want and then start selling covered calls.
But if stock goes up (on call) even stock appreciation isn't it minus the in the money premium?
What is the tax implications of rolling a credit spread. Will wash sale rule apply?
I don't need to own any share for selling put but I have to own at least 100 shares for selling call, it is correct?
u need the capital in your account for 100 shares of whatever the strike price of the put u choose in case u get assigned for example if u want to sell a put with a $20 strike u would need to have at least $2000 in your account in order to do so
This should not be free for real this is just amazing information. 😬👍🏾
do you still love to own OTLY at 17.5?
For a beginner how do I start?
The "OTLY" comments about loving the idea of owning Oatly at $18 didn't age well as it has plummeted to $8 a few months later.
So...get it now? Lol.
One of the best options video!
Thx uncle
What if planter dropped to 15, then how can you sell calls on that? What if it stays at 15 and the 21.50 call doesn’t give any good premiums? Wouldn’t you be stuck with pltr for a long time until it gets back to 21.50?
I learned that the hard way. Got to get stocks that are more stable in price, low volatility...
That's the real risk here. If you start the wheel too high and catch a falling knife, it will take you a long time to recover only by premiums. His PLTR play makes sense though. It's basically been locked between 21 and 25 since March, so it's not a bad idea to sell puts around $20 strike price.
what is the capital gains tax for option trading? i heard its higher than normal trading.
Hi, could you explain why every time I place an option order I take a day to be active? Thank you.
You said you usually sell options right at start of trading day around 9:30ish on Mondays. Is it better to wait a couple hours for market to settle for the day before selling options?
It depends!
Amazing explanation very beginner friendly
using a previous premium to lower your average price so the next option looks better doesn't sit well with me. I like to keep it simple so what I see in the account is what it is, and tracking is easier. Once i get the premium it's over and is profit. When i get assigned the shares eventually the avg price is the price i bought at which would be the strike. Then i sell a call based on that real price of the currently held shares so i'm not letting previous gains evaporate to make the next trade look better.
Hi Henry if we get close to expiration and atm when selling a put, does Robinhood auto exercise it or they auto buy back the put?
Robinhood does not exercise your option automatically, only the holder of that contract can do so before expiration. Robinhood will only automatically assign you to those shares if your put or call is in the money ITM
How far out are you usually buying options, Im buying a month or two out? I just started a few weeks back. I read up on how they work and started selling puts on stocks I wanted to own. I then came up with this smart idea to buy more then sell a call on it if I get put the shares. I keep thinking I am figuring out brilliant ideas as I look at the math of all of this and wondering if anyone has figured this out. Then I find out Im not really that smart, its already being done everyday my thousands of others, lol.
Good strategy but it’s requires a big account
Is there a way to be dong this but with a smaller account?
@@michaelquintans1184 yeah. but you'd have to ru the wheel with cheaper and more risky stocks
@@michaelquintans1184 I only do it with aapl and tesla
@@friedpickles342ouch
@@johnt6810 yeah ouch indeed
awesome video henry!!! Thank you very much..!!! i understand everything now..!!!
so wat is the risk?
What about selling a covered strangle,after u get assigned on the first put u sell?
That's great! Need to make a video on that. It's in my Private Discord program
Great content and explanation.. Thanks Henry!
I continually sell puts and covered calls on my TSLA stock. Great way to make money to buy more stock.
Great stuff this series is 🔥🔥🔥🔥
Which is better: selling weekly puts or monthly puts ?
When did you start using this strategy and what was your portfolio value when you started? Does that near 1 million portfolio value you have now equate to only gains or have you added more cash?
50/50
You are very good but I don't understand nothing about the world of options 😢
what timeframe are you doing the puts and calls? Weekly, monthly?
Clear and concise thank you!