Put Ratio Spreads! - Add some INCOME with this option strategy. Examples using Fidelity.

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  • เผยแพร่เมื่อ 16 ม.ค. 2025

ความคิดเห็น • 69

  • @wealthadventures
    @wealthadventures  3 หลายเดือนก่อน +55

    Just noticed at 12:52 I say "you can close out the debit spread and have a long put left"... that would be a short put. Hope I didn't confuse anyone!

  • @striperkid
    @striperkid 3 หลายเดือนก่อน +8

    I'm going to bookmark this video because I'll be learning about options next year when I'm retired. Gives me something to do.

    • @michaelhaidee
      @michaelhaidee 3 หลายเดือนก่อน

      Head on over to Tasty Trade and Tasty Live. Great way to learn options for free.

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน

      Sounds good! Let me know if I can help.

  • @passivedividendsoptions
    @passivedividendsoptions 3 หลายเดือนก่อน +2

    I like using this trading strategy, thanks for the video!

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน

      My pleasure! Thanks for watching.

  • @CGroovy1975
    @CGroovy1975 3 หลายเดือนก่อน +3

    Thanks as usual Dave!!

  • @henrim9348
    @henrim9348 3 หลายเดือนก่อน +4

    Great example. Thanks for sharing. I use fidelity as well

  • @Seoulsearch616
    @Seoulsearch616 3 หลายเดือนก่อน +1

    Love the movie clips in your examples! 😂

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน +1

      Ha! Thanks. It makes it more fun to make these videos.

  • @daiski79
    @daiski79 3 หลายเดือนก่อน +2

    Good strategy, one big advantage I see is that you don’t have to wait for the stock to hit support levels or an oversold RSI, with that, you may execute right away.

  • @A.Z.C.9
    @A.Z.C.9 3 หลายเดือนก่อน +1

    Great video, It got me thinking about the “wheel strategy” and how they compare. Both strategies start off with selling puts but this one involves using the premium received to finance a put debit spread, so less premium received, but more downside risk protection. So i guess it depends on an individuals view of the market, if bullish - just sell the put, collect max premium. If bullish but afraid of drawdown run with the put ratio spreads. Either way you will need to have the cash on hand ready to buy the $100 so using this for blue chips is good.

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน +1

      I like to churn my puts but as the market continues to climb (and with what "feels" like uncertainty) I get more conservative and like to use these types of trades.

    • @A.Z.C.9
      @A.Z.C.9 3 หลายเดือนก่อน

      @@wealthadventures I definitely see where you’re coming from with that. Also great content dude, been a sub for a short while and picked up a few things from here!

  • @YIWOTY
    @YIWOTY 3 หลายเดือนก่อน +1

    Love debit spreads for speculative replacements for shorting stock. Also love to enter debit bear put spreads on SPY and sometimes QQQ as a hedge when everything is flying high.
    However I’ve had some bad luck on ratio spreads with the stocks just continuing to drop. In one case, I closed out one of the shorts for a “profit.” But as the stock falls, I no longer have two shorts to decay to offset the decay in my long option.

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน

      Maybe stick to what sounds like is working for you - SPY/QQQ!

  • @LG-tw5vm
    @LG-tw5vm 3 หลายเดือนก่อน +1

    Have you ever thought about day trading or swing trading? You can produce a higher return with the money you're using to sell puts.

  • @24hrstolive27
    @24hrstolive27 16 วันที่ผ่านมา +1

    new to channel love the content, wondering why do u use fidelity, im with scwab and curious if i should switch

    • @wealthadventures
      @wealthadventures  13 วันที่ผ่านมา

      I'm sure Schwab is fine. I've always used Fidelity so I know it pretty well. I also use Etrade and M1.

  • @harsharao3555
    @harsharao3555 3 หลายเดือนก่อน +1

    Good one Dave. Thank you. How about selling covered calls and then buying puts on the shares owned to protect against sudden stock prixe declines? Would you consider doing an example trade in the above-mentioned scenario?

    • @A.Z.C.9
      @A.Z.C.9 3 หลายเดือนก่อน

      I’m curious to see how that works, cause selling a covered call already gives you downside hedge. You own 100, then sell a call (i.e covered call) and collect premium. Now, there is nothing stopping you from buying extra protection, and you can use the premium received to buy the put, but this is where my curiosity comes in, and tbh just selling the covered call should be sufficient but maybe someone else has better insight.

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน +2

      That is called an option collar. I have not done a video on it directly but I did talk about it in this video:
      th-cam.com/video/870tezZND0U/w-d-xo.html
      It is also what many hedged equity ETFs do like this one:
      th-cam.com/video/2w4k1ghVY6k/w-d-xo.html
      I will look at doing a video in the future!

    • @harsharao3555
      @harsharao3555 3 หลายเดือนก่อน

      @wealthadventures that's what I am doing with a couple of stocks that are close to earnings reports. Write covered calls and buy puts far out of money for downside protection in case stock falls on earnings. Of course, I do this on those stocks that are expected to trade sideways or down over the next few months. Would love a video on the same.

  • @steelhorses2004
    @steelhorses2004 3 หลายเดือนก่อน +3

    When would you use this put ratio spread vs a put credit spread?

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน +1

      Good question... I use both when I'm being more conservative versus just selling puts. I tend to put on credit spreads that are out 60-90 days and when I have most capital tied up. These I typically sell out 30-60 days and have capital to activate. If you really want to kick in technical analysis, it can help you target support levels as someone else mentioned.

  • @grodge61
    @grodge61 3 หลายเดือนก่อน +1

    Nice video. I use this strategy quite a bit as well. Do you consider trading costs which can use up a few percent of gains? Also, what are thoughts on broken wing butterfly which is a put debit spread but then buy a far OTM put to define the risk?

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน

      Yes - Trading costs can be substantial and I would like to see Fidelity get them lowered. I like the broken wing butterfly, like this trade, if I can get a nice credit initially.

  • @MikeBrewed
    @MikeBrewed 3 หลายเดือนก่อน +1

    what are the capital requirements for this type of trade for the NVDA example?

    • @A.Z.C.9
      @A.Z.C.9 3 หลายเดือนก่อน +1

      You will need enough to cover the purchase of 100 shares of the underlying at the strike of the put you sold. So if you sold the put at $80, you will need $80*100 shares = 8000.

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน

      You should have the put covered.

  • @robertbarry1792
    @robertbarry1792 หลายเดือนก่อน +1

    Is it worth it to wait and do each leg at different dates rather tha both legs on same date?

    • @wealthadventures
      @wealthadventures  หลายเดือนก่อน

      I initiate the trade with both legs but often close or roll one leg.

  • @brendanquinn6894
    @brendanquinn6894 3 หลายเดือนก่อน +1

    Creative Dave. I trade the "frill necked lizard". It is a position I trade that I invented and named after an Australian lizard that isn't famous yet. Alas, those of us at the ASX have to just endure.

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน +1

      Must be hot down there. Maybe too hot. Lol.

    • @brendanquinn6894
      @brendanquinn6894 3 หลายเดือนก่อน

      @@wealthadventures Not really. It's like California here in Victoria. (I got sunburned in Arizona so I know how hot it gets over there).

  • @bruceharrell1754
    @bruceharrell1754 3 หลายเดือนก่อน

    Thanks Dave! Learning a lot from ya. What Options level with Fidelity allows you to do this? Guessing level 2 or 3?

    • @A.Z.C.9
      @A.Z.C.9 3 หลายเดือนก่อน

      Level 3, as you will need spreads. But maybe things have changed since I got approved.

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน

      Thanks! Looks like level 2. You can find info here:
      www.fidelity.com/options-trading/faqs

  • @envisionjd
    @envisionjd 3 หลายเดือนก่อน +1

    So on November 15th will you follow up with what you did?

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน

      Sure! If I don't, remind me! I did not do the NVDA trade so I assume you mean the TLT trade?

  • @ernestoortizjr.6782
    @ernestoortizjr.6782 8 วันที่ผ่านมา +1

    Why is it called a “long put” if it has the same expiration date? What is the “long” referring to?

    • @wealthadventures
      @wealthadventures  7 วันที่ผ่านมา

      Long is similar to "owning" or buying where short is similar to selling. So if someone is long a put, they own a PUT option. If they are short a put option they SOLD a put and are short a contract. Likewise, a long call would mean you own a call option. Make sense?

  • @tomwat-f2z
    @tomwat-f2z 3 หลายเดือนก่อน +1

    Although investing in stocks appears straightforward, choosing the right ones without a well-defined plan can be challenging. My $350K portfolio, $10K in an HSA, and a property that could yield an additional $200K have stagnated primarily due to lack of clarity in my strategies. I’d welcome any advice you can provide.

    • @wealthadventures
      @wealthadventures  3 หลายเดือนก่อน

      Low cost index ETFs. Dollar cost average. Keep it simple.

  • @Kms7171
    @Kms7171 2 หลายเดือนก่อน +1

    Wait no spam financial advisor recommendations in the comments section? Why not?

    • @wealthadventures
      @wealthadventures  2 หลายเดือนก่อน

      I try to keep it cleaned up... but the spam keeps coming!

  • @rogerp1477
    @rogerp1477 2 หลายเดือนก่อน +1

    You were rambling a bit more in this video. But content is good as usual.

    • @wealthadventures
      @wealthadventures  2 หลายเดือนก่อน

      I'm a professional rambler! Lol.