Mind to ask? Are you using IBKR for options. If yes, is it normal to see Rolling Options feature shows "NA" when you click calculate? Try play around this last night, no matter which i click, when Buy/Sell orders i can preview the calculate, but it shows NA when i use Rolling option.

2) Is it a bad habit to monitor the option everyday? I found myself keep looking at the stock price every now and then to see whether I'm closed to ITM and re-think should i roll down/out. (Or because this is just psychology problem as this is the first time i'm trying out options).

being glued to the screen is normal when you are gambling. I use options to reduce my stock risk and sleep better at night.

don't know about IBKR but it costs me $0 for my options to expire worthless so I only open positions after the old one expire

Fire and forget

This post has been edited by Medufsaid: Apr 28 2022, 09:29 AM

I don't roll. I just let it expired worthless or in the money and take assignment.

If you are glued, you are doing something wrong. I just checked it once day. That's it. Don't need to be glued. Like I said remember rule of 1 doing options.

If you are selling put, you are ok with buying 100 shares at that strike price. If you are not ok, don't bother.
If you are selling call, you are ok with selling 100 shares at that stole price. If you are not ok. Don't bother.

I give you an example. I bought Starbucks 10 shares ar 86.6. Did I regret? No. I am buying again at 75.

This post has been edited by Ramjade: Apr 28 2022, 10:02 AM

Q: Eventually you'll get assigned for the stocks you want while doing options.

Assuming the assigned stock got plummet for 30% below your Put price after assigned, would you sell Covered call on the price you got for the stock or you'll adjust accordingly (nearer to ITM and get more premium and find the balance that you'll still get profit without losing $$)

Another question is. If you know that the stock is currently in a bearish situation but you're bullish on the stock. How do you see selling a Put Options with a Limit Order *and* set to *Good till Cancel*.

Example: Selling a put options on PLTR with a strike price $10 when the stock price is at $12 (just example) and the options premium by end of the week is only at 0.04. So, is it good that if I were to set a Sell Put Options with a limit price of 0.10 (This is the premium) and i set *Good till Cancel*.

For the example above, can i assumed that if the Order got executed, i will get a higher premium // If the order did not reach the limit price i set, the order will not be processed then nothing happen

This post has been edited by Lon3Rang3r00: May 3 2022, 01:26 PM

please rephrase your questions clearly. you need to state the strike price and what options (call/put) it is

Done update, should be readable now? Sorry, cause the option thing still very new to me so i not sure how to phrase it

Lon3Rang3r00

Of course I still sell covered calls on it. Come I give you an eg. I have TSMC at 115. Now its 93.xx I am still selling weekly covered calls on it and pocketing USD2x-3x/week from it. No I don't adjust nearer to ITM as I want to hold on to it long term. Why should I get a higher premium for the stock to be sold away at a loss if there is nothing fundamentally wrong with the stock I am holding?
As long as I am holding the stock, it is generating cashflow for me on a weekly basis and I am holding on to strong companies which will rebound over time. By not selling, I am guaranteeing myself cashflow every week. Don't go chase small short term gain for long term profit.

Yes you can sell put on it. In a down market, it's more profitable to sell puts then sell calls.
There is another way you can do. Let me intro you to poor man covered call. Buy a call options either ATM or Deep ITM with expiry date of 1-2 years out. Once you have bought that call, now you can start selling covered calls on it.
So if price increase, your call value should increase in value. it needs to outrun theta decay and you get to continue doing covered call on it until your covered call get assigned. Then you just exercise the call you bought to pay it off.

So, you paid the premium to hold the 100 shares instead of paying the actual 100 shares price, and then selling a covered call on it.... it sounds like a glitch to me since you don't actually owned the shares and yet still can sell it off it sounds macam trading the paper contract instead of shares.

For the long call options that expiry after 2 years, assuming if the shares price went up then you will get capital gains if exercised the calls options. If the shares price went down, you can abandon it and forfeit the premium you paid. why it sounds like it doesn't have much of a flaws.



I always got mix up with buying an options, so write it down here in case anyone may need it

Selling a Put Options = You get the options premium in exchange for buying shares at a strike price on or before the expiration date.
Selling a Call Options = You get the options premium in exchange for selling shares at a strike price on or before the expiration date.

Buying a Put Options = You pay the options premium in exchange for the right to SELL shares at a strike price on or before the expiration date.
Buying a Call Options = You pay the options premium in exchange for the right to BUY shares at a strike price on or before the expiration date.




This post has been edited by Lon3Rang3r00: May 4 2022, 08:16 AM

Just remember selling put and selling call. Then remember it's the inverse of it when it comes to buying. If you are trying to remember both, you going to get yourself confuse.

That's why I only remember selling puts and calls and never bother with buying options. Buying options for me only reserve in severe cases like in 2008.

This post has been edited by Ramjade: May 4 2022, 08:08 AM

True, lower strike price and also lesser premium to pay for ITM compare to all time high. Hmm , Poor Man's Covered Call look to me like setting a time target for yourself to earn enough premium to cover the amount you paid for buying the long call. Anything after the breakeven is profit. The name Poor Man, just so poor people can buy stock that they can't afford just so they can do covered calls

Noticed this on Google stocks, could that means these people just wanna sell Covered call and don't bother about capitalization gain?

can be anything. the simplest explanation is, a naked sell-to-open for the call option weeks ago at $70, and then buy-to-close for a good profit (this is a "good ending", or maybe he sold a covered call and closed position at loss)


to find out more, you need to know if the transaction you saw resulted in a reduction in open interest.
reduction = he buy-to-close
increase in open interest numbers = he buy-to-open



and even then, it doesn't tell u about the shares activityyeah that is what futures and options are all about. You don't have to have it* before expiry date
_{*ignore the ITM and kena exercised options}

This post has been edited by Medufsaid: May 4 2022, 01:00 PM

Still don't get it for Poor Man's Covered call (Please bear with me)

After you buy the LEAPs that expired in two years time, then you move on to selling a covered calls.

So my question
1) What happens if your covered calls got exercise? Did the initial "LEAPs options that you purchased" also got exercised?
&
2) What happens if your covered calls expired? Continue to sell covered calls?

3) Assume that everything went well, is the LEAPs automatic exercised or you need to manual intervene to exercise

Yes and no.
By buying a deep in the money call. Your options still have value upon expiry. If it's in the money upon expiry it's automatically exercised.
That means you are buying 100 shares at xyz price at 123 date.

Eg. Apple. Current price is 162. You buy a call options of apple at 145 expiry 2 years from now and pay a premium for it.
Now 2 years later, apple is say 250.
You can now buy Apple at usd145. There's a net profit of USD250-145 = USD105 x100 shares
Then add in your covered call profits minus the premium you paid for the call.

Alternatively you can just sell your call say at 6 months prior to expiry and pocket the premium from selling and start doing a new poor man cover call. So no. You don't exactly
"earn enough premium to cover the amount you paid for buying the long call. Anything after the breakeven is profit. "

Hope that's clear.

@Ramjade, can share why u prefer weekly options over monthly? weekly u are paying more brokerage fees, no?

1. You want the options to decay at a faster rate so that it expired worthless.
I never buy to close. Most of my options expired worthless. Hence I only pay one time brokerage (when I sell options only).
But if paying more per week Vs monthly yes. But if you are earning like USD400-700/week, just treat the commission as business cost to generate revenue.
2. Anything can happen in a month.
Yes there's more meat on the options for 1 month expiry. But what happen if market spike like crazy in a month?
Remember for options you want it to expired worthless most of the time.

End goal is to make money from your options and not lose money. So up to you want to go with one week or one month options.
If you feel you can make money with one month options, by all means. Go with one month options. As they said black cat and white cat as long as can kill the mouse, doesn't matter what colour the cat is.
Yes some people will tell you to do monthly options (I know some expert people online doing monthly in my telegram group and some YouTuber recommend monthly over weekly).

For me, I feel safer and I have been getting consistent results with my weekly options. So I am sticking with my weekly options. I feel less safe with monthly options. It all boils down to personal preference.

idk if i'm asking a dumb question, because I'm still a newbie dipping my feet into options and stumble upon selling covered calls. I saw that selling covered calls and letting it expire worthless will receive the full premium.

So what if I just sell a call of AAPL 13/5 180 at a price of 0.10. (foreseeing that apple won't hit 180 by the expiration date), I could just sell 10 contracts of it, that would make 100 bucks and let it expire. So that I could earn that sweet 100 bucks out of it.

Please correct me if I'm wrong.

Each contract = 100 shares = 0.10 x 100 = $10.
10 contracts = you have to hold 1000 shares of AAPL before you can sell a covered calls. I'll be surprised if you willing to risk so much for so little premium.

Yeap, I did noticed that, but what if the price of the stock does not hit the strike price upon expiry? I will still keep the premium right?

Yes you can do that. But usd120 (12 months x USD10)/18000 = 0.6%p.a if you ok with it, by all means go ahead.

0.6%p.a is even worse than any FD you can find in Malaysia.

Now if it's USD10/week = USD10x52 weeks/18000 = 2.89%p a.
Ask yourself is it worth it?
Unless you are holding apple stock.
If you are not and just trying to get the premium, our EPF is giving us 5-6%p.a

Another thing. How sure are you apple won't reach usd180/share by next month? Who knows if fed suddenly said we will ease back on interest rate, or bear market ends and market goes on a run?
What happen if it breach usd180? What are you going to do?

This post has been edited by Ramjade: May 5 2022, 04:34 PM