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Well Done! Selling Puts and Calls are where it's at. I do hold DIV stocks, but seem to make alot more per month on the premiums. 25% of portfolio is in DIV stocks, 75% running the wheel. Let's go us!!!!! Good luck all!
would you recommend doing this on the wealth accumulation phase? or only when you need the income? basically im asking if the total return will be better with or without it?
I personally would not recommend doing this with the goal of accumulating wealth from it. I think its a powerful thing to learn while you are earning money in your main career or other side gig like real estate etc. Then once you have the money, transfer it into the brokerage to generate income off of it.
Great video I learned something new. I trade options but I moved my money to Fidelity as long as I don't get assigned I collect interest on the money being used for covered calls. It's basically double-dipping.
I’m at Schwab, I have my cash in SWVXX, collecting interest, if I get assigned, I just sell the amount I need to cover and it clears the next day, not a big deal, although it’s nice that Fidelity does it for you.
While aiming for 20% below the current price seems safe, in the off chance that some bad news about the company comes up and the stock drops more than 20%, overnight , you better be comfortable if the stock is put to you for the number of contract times 100 shares. So, I think you also need to be mindful about the allocation for that stock in your portfolio.
Great video. If you are not planning on doing this long term then are you reinvesting a portion on your option income back into your dividend portfolio? Also for people new to this, be careful trading into earnings. I am one of those people that generally avoids it. Wanting to own the shares you are trading also helps tremendously.
I've started doing this too. If something gets assigned I just start doing cash secured calls. Two months in it seems to be a way to generate extra cash. Good video with explanations and strategies.
yeah it felt a little overwhelming when I was first learning about this. Once the "light bulb" turns on, it all makes sense and then you actaully get excited about it!
Yeah it can be really powerful to squeeze some more juice out of the lemon. It takes a bit more time though. I tend to like JEPQ to make it more passive.
Hi Jake. Been a subscriber for many years :) I am a dividend investor at core, getting now about $2K / month of dividends in my taxable account (bc I hope to use these to semi-retire in a couple of years when I am 53). I am also a ‘buy quality, hold forever’ mainly and as such I am not holding much cash in my taxable. Now I am learning on “safest” way to make money from options and your video is definitely bookmarked - thanks! :) I hope to be able to add selling options as another tool to provide income to supplement my dividends after 53). On main question comes to mind: Your video focuses on how you are selling cash secured puts for income. I am wondering if you do sell covered calls out of your positions as well? Assuming selling far OTM CSP vs far OTM CC are the same kind of risk (is it?) - why selling CSP right now which forces to have cash available (and maybe having to sell positions + cap gains hit to do so) rather than selling far OTM calls? Particularly right now in mid-feb 2024 when market is in extreme greed. Just curious on your thoughts on that :) Thanks again for the invaluable information you provide Jake!
Hey!! Thank you for taking the time to comment this and yes I sell CC as well (not in my M1 account though). Selling far OTM CC come with less risk in my opintion, assuming you own the shares and are not using margin. It would make more sense to sell CC when in extreeme greed and CSP in extreme fear. Once I sell SOFI, my main strategy with my options account will be to hold JEPQ/SCHD/VYM as my underlying and then sell CSP with the margin in my account. I may allocate about 15-25% to growth stocks to do the wheel strategy as well.
Can you make a video of a covered call for beginner option trading. For dummies on Aries or Robinhood platform. I know Robinhood has a large bid as spread. Aries does not.
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Thanks for watching!
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Well Done! Selling Puts and Calls are where it's at. I do hold DIV stocks, but seem to make alot more per month on the premiums. 25% of portfolio is in DIV stocks, 75% running the wheel. Let's go us!!!!! Good luck all!
Good stuff!
would you recommend doing this on the wealth accumulation phase? or only when you need the income?
basically im asking if the total return will be better with or without it?
I personally would not recommend doing this with the goal of accumulating wealth from it. I think its a powerful thing to learn while you are earning money in your main career or other side gig like real estate etc. Then once you have the money, transfer it into the brokerage to generate income off of it.
@@DividendGrowthInvesting thank you so much, I learned so much from you
Great video!!!!’ Love the cinnamonnnnnn roll lol. Can’t wait till you do one on covered calls!!!!!!!
Thank you!!! lol the cinnamonnnnn roll
Great video I learned something new. I trade options but I moved my money to Fidelity as long as I don't get assigned I collect interest on the money being used for covered calls. It's basically double-dipping.
Glad it was helpful! Exactly!! It can be a way to get more bang for your buck!
Yes. Smart man. I'm at fidelity now also
Same reason I moved from robinhood to fidelity lol
I’m at Schwab, I have my cash in SWVXX, collecting interest, if I get assigned, I just sell the amount I need to cover and it clears the next day, not a big deal, although it’s nice that Fidelity does it for you.
While aiming for 20% below the current price seems safe, in the off chance that some bad news about the company comes up and the stock drops more than 20%, overnight , you better be comfortable if the stock is put to you for the number of contract times 100 shares. So, I think you also need to be mindful about the allocation for that stock in your portfolio.
Yeah very good point. It can get messy quick especially if you cant see yourself owning the stock.
Great video. If you are not planning on doing this long term then are you reinvesting a portion on your option income back into your dividend portfolio?
Also for people new to this, be careful trading into earnings. I am one of those people that generally avoids it.
Wanting to own the shares you are trading also helps tremendously.
Hey mike! Yeah I’m going to move it all to my dividend portfolio in the future. Earnings can be tricky so it’s good to be willing to own the shares.
Thank you for explaining the greeks, much appreciated
I've started doing this too. If something gets assigned I just start doing cash secured calls. Two months in it seems to be a way to generate extra cash. Good video with explanations and strategies.
Glad it was helpful! It can be a great way to generate more income.
I appreciate you going through all of the minutiae of options trading in layman’s terms (for me anyway) …👍🏻🙏🏻
Really glad it was helpful! Thank you for watching!
sounds like a steep learning curve that can totally pay off. fascinating stuff, thanks Jake.
yeah it felt a little overwhelming when I was first learning about this. Once the "light bulb" turns on, it all makes sense and then you actaully get excited about it!
May I ask where/how you first learned about this?@@DividendGrowthInvesting
I haven't done options in a while. There's $46 covered calls plus $50 in dividend this month from one stock. I doubt it will hit the strike price.
Yeah it can be really powerful to squeeze some more juice out of the lemon. It takes a bit more time though. I tend to like JEPQ to make it more passive.
Can you make a new video about selling CSP and CC please?
Have you try vertical put credit spread? for high price stock..
No nothing I’ve really dove into. I focus on single leg puts
Great video as always.. learned a lot today. same way could you please explain covered calls with some examples please. Thank you!
Glad it was helpful!
Hi Jake.
Been a subscriber for many years :)
I am a dividend investor at core, getting now about $2K / month of dividends in my taxable account (bc I hope to use these to semi-retire in a couple of years when I am 53). I am also a ‘buy quality, hold forever’ mainly and as such I am not holding much cash in my taxable. Now I am learning on “safest” way to make money from options and your video is definitely bookmarked - thanks! :) I hope to be able to add selling options as another tool to provide income to supplement my dividends after 53).
On main question comes to mind:
Your video focuses on how you are selling cash secured puts for income. I am wondering if you do sell covered calls out of your positions as well? Assuming selling far OTM CSP vs far OTM CC are the same kind of risk (is it?) - why selling CSP right now which forces to have cash available (and maybe having to sell positions + cap gains hit to do so) rather than selling far OTM calls? Particularly right now in mid-feb 2024 when market is in extreme greed. Just curious on your thoughts on that :)
Thanks again for the invaluable information you provide Jake!
Hey!! Thank you for taking the time to comment this and yes I sell CC as well (not in my M1 account though). Selling far OTM CC come with less risk in my opintion, assuming you own the shares and are not using margin. It would make more sense to sell CC when in extreeme greed and CSP in extreme fear.
Once I sell SOFI, my main strategy with my options account will be to hold JEPQ/SCHD/VYM as my underlying and then sell CSP with the margin in my account. I may allocate about 15-25% to growth stocks to do the wheel strategy as well.
Thanks for your reply. "Once I sell SOFI"... not sure what you mean?
@@fabp1773 I have a leap call on SOFI. Once it expires I will go more into ETFs as my underlying.
Can you show the formula from column P and N?
P: =L10/O10
N: =L10/M10
1:28 cinamon role - love it :) - That's is not how you spell cinnamon and roll
lol :D
Can you make a video of a covered call for beginner option trading. For dummies on Aries or Robinhood platform. I know Robinhood has a large bid as spread. Aries does not.
Yeah i can touch on it in a future video. Thanks for watching!
Well I was right. Pasive income selli puts and I assume covered calls too.
yup!
First
Hey there!!!
Well played sir.