Newbie question: what do you do with the LEAPS before expiration ? You exercise it to buy the stocks at the (hopefully) lower price and pocket the gain?
If the LEAPS are worthless you will be forced to buy the shares at the price of your strike. You would never do that though, unless you really wanted the stock.
Hello Ryan… thanks for the videos.. I am gaining from them. I would love for you to expound on your TOS setup. I like the clean look that you have… mine needs an update!
Hi Ryan, Do you recommend this strategy for bear market or so to say, we have risk of bear market. I mean, its better to buy a leap call than 100 shares of a stock and keep rest of the cash in fixed income like BIL. And if the markets fall considerably, we can buy a new leap. This way, we will have cash ready to deploy when market is down.
No I do not recommend PMCC for bear market. I just released a video on my channel that discusses bear market strategies. If you want to buy LEAPS at the bottom of a bear market, then it could work if you go out 2+ years in time, but your timing would need to be impeccable
Selling cc against leaps , what s worst case case scenario. U sell cc against your leap, can your leap get called away ? Since you don’t have 100 shares of cash secured ? Thx
you would never let your short call expire. When you roll you are essentially taking a loss on the position you closed out and opening a new position to cover your loss.
@@OptionsWithRyan But what is the answer? I know we should not let it expire, but what happens to the LEAPS if we allow the call to expire ITM? Just subscribed.
I have a question: I have 100 shares of NVDA and also recently purchased a leap a year out….. If I sell a covered call against both of them with different strike prices (one higher than the other one) and if I get assigned, wich one will they exercised? I am assuming my 100 shares of NVDA right? Not my leap….
Hey Ryder, you gotta believe in the stock in the long run. I like Google where its at. PE ratio is low in comparison to competitors and good discount on the stock.
Thanks for the video I have a question, how can you figure out a stock earnings so I don’t sell a cover call on it? Thanks again
earnings whisper usually has the date way in advance...or google it and something usually pops up
Newbie question: what do you do with the LEAPS before expiration ? You exercise it to buy the stocks at the (hopefully) lower price and pocket the gain?
You can either sell the LEAPS option and pocket your gain or you can exercise the right to buy the shares outright at the strike you purchased
If you ever got assigned on your LEAPS, do you have to settle in cash if the LEAPS in down in value ?
If the LEAPS are worthless you will be forced to buy the shares at the price of your strike. You would never do that though, unless you really wanted the stock.
Hello Ryan… thanks for the videos.. I am gaining from them. I would love for you to expound on your TOS setup. I like the clean look that you have… mine needs an update!
Hey Douglas, I appreciate you watching the channel. I will go over my TOS setup on the next round of videos. It's really nothing too complicated.
Hi Ryan, Do you recommend this strategy for bear market or so to say, we have risk of bear market. I mean, its better to buy a leap call than 100 shares of a stock and keep rest of the cash in fixed income like BIL. And if the markets fall considerably, we can buy a new leap. This way, we will have cash ready to deploy when market is down.
No I do not recommend PMCC for bear market. I just released a video on my channel that discusses bear market strategies.
If you want to buy LEAPS at the bottom of a bear market, then it could work if you go out 2+ years in time, but your timing would need to be impeccable
Selling cc against leaps , what s worst case case scenario. U sell cc against your leap, can your leap get called away ? Since you don’t have 100 shares of cash secured ? Thx
Ya the broker will most likely use the leap + any additional cash in the account as collateral
after couple of rolls, even then if short call is in the money (assigned), then what happens to the Leaps ? will the Leaps be taken away ? thanks
you would never let your short call expire. When you roll you are essentially taking a loss on the position you closed out and opening a new position to cover your loss.
@@OptionsWithRyan But what is the answer? I know we should not let it expire, but what happens to the LEAPS if we allow the call to expire ITM? Just subscribed.
do you take into account the IV say for example its at 50% or higher then you open the short call for the PMCC?
not really. I would look at the bollinger bands and make sure the stock is trading closer to the top bands before entering a covered call
@OptionsWithRyan all right, thanks for ur insights ryan.
I have a question: I have 100 shares of NVDA and also recently purchased a leap a year out….. If I sell a covered call against both of them with different strike prices (one higher than the other one) and if I get assigned, wich one will they exercised? I am assuming my 100 shares of NVDA right? Not my leap….
yes your 100 shares will get called away if the call expires in the money
What do you think about Google with the whole chrome thing?
Not worried about it in the long run
Was going to do a poor mans covered call on Google but wasn't sure about the chrome thing
Hey Ryder, you gotta believe in the stock in the long run. I like Google where its at. PE ratio is low in comparison to competitors and good discount on the stock.
LEAPS not LEAP
good catch