I watched your older videos among others years ago, practiced with a small account for a few years, and left my job at the end of February and have been living on selling options, dividends, and keep a 2 year cash reserve. At 60 my goal is to collect social security at 67-70, but would take it earlier if needed. That is why I keep the 2 years cash, and will keep moving the 2 years out if things are looking good. The dividends cover my basic living expenses with a little left over, same for the options. All profits, if any, go to cash, more dividends, more options. Small account, wasn't planning to retire for another 2-4 years, but stuff happens. I don't own a home, lifelong renter. Staying in my old apartment while I make sure all this works and I can at least collect early SS if needed. Then will move to a cheaper part of the country. I prefer index funds to individual stocks.
Good overview. I like to enter in a covered strangle (buy 100 shares, sell a covered call sell a put) one way is guaranteed to expire worthless if at different strike prices.
Subscribed....Trying to figure out options and your explanation in this video is great. Can you tell me why selling options is less risky than buying options?
Thank you so much. 2 years ago I got clean and sober after a life of substance abuse. Now I run 100 mile races. youtube.com/@bradfinntrains?si=jy96ucJfSppHrawP
@ that’s incredible, I just got into options trading again after a break in 2021-22 where I was more focused on my business. I was shocked when I saw your face! (Not that you looked horrible) Good for you brother!
I like how Fidelity illustrates your true cost basis when selling. Ex: If I sell a $190 Call with $300 premium on the Cost Basis screen, they display that I sold my shares away for $193.
Minus fees, commissions, cost to write/close contracts, and if called the contract appreciated and ate n2 the stock price upon sale. But basically yes minus a lot of hidden expenses
Great video Brad! Love selling covered calls. Could you make an updated video on when the current price is FAR below from your cost basis. For example, the stock xyz , your cost basis is $200 for 100 shares, and the current price is now trading at $150. When you look at the option chain on Monday, and you want to pick a $200 strike price, there is zero premium to collect. What would you do in this scenario? Also, the same goes when the covered calls goes ITM? Do you wait until the expiration date to roll your contract out and up, or do you roll before the expiration date? Thanks again for these helpful videos!
@ Great analogy! I do the same thing, once price hits my strike price on my cash secured put or covered call, I immediately roll. I don’t wait for expiration, I want to be in control of the trade at all times especially when I sell a put. I don’t wan the shares to be assigned to me if the price keeps falls, same with the call side. I don’t want my shares to be called away. It’s so important to know how to roll properly and how to manage your trades when selling options. Because I know how to roll, it has gotten me out of some bad positions where I was able to turn them around to a positive trade.
Loved this video!! Can you please make a video on how you plan to quit your w2 and use options to fund your life? How long did it take you? How can someone follow your steps to reach the same goal. I also want to do this but need some guidance. Thank!!!!!!!
Essentially I just sell covered calls and cash secured puts. Takes a few years, but is easily scalable enough to generate enough premium to live off of. You just have to be patient
When calculating the cost basis of a stock do you take into account the options premiums and dividends or is it just average purchase price? If you bought 100 shares at $100 a share then sell an option for $100, does your cost basis drop to $99?
I used to track net basis but it just became too much work. So if I’m being honest, now I just use the basis on the shares and don’t account for premium and dividends collected.
Hi Brad! You are a good teacher. I have been thinking to enter into options trading and watching several youtube videos where options trading are explained. But your explanation is very much convincing me to enter into the option world. I have a question about the Greek 'DELTA' value. You mentioned that lower delta value means the chances of the stock price hitting the strike price at the expiration of contract is less (relatively). I have a question. Suppose the stock price is $10 (cost basis) and the current stock price $13. Here is the scenario. For the covered call if I fix the strike price of $16 (for sure the stock price will not reach $16 at the expiration date) and the price goes to $13 at the expiration date what should I do? should I buy back (buy to close) or I can leave the contract until it becomes worthless. I would appreciate your response.
Got a question for you Brad . What if you own 100 shares of XYZ but it is currently in the red ? Still sell a call with the same rules ? In this example you were up on the stock when you sold the option . Just wondering about if you’re not .
I need some help with a covered call. I have sofi at 16.50 strike exp 2/14. Wanted to run the wheel on this but price has moved so much more than expected. Should I roll? Or let the shares get called away and sell a put? Idk what to do.
Are you mainly doing this strategy using ETFs? Or a combination of ETFs and individual stocks? I am heavy into TSLA, but don't necessarily want to risk getting my stocks called away. I am gun shy after what happen with me selling NVDA covered calls last year. I made decent sum but missed out on multiple hundreds of thousands of dollars. ETFs don't have that much volatility. So, to me they are the best vehicle to sell CC on.
Good video brad. how much would you go out the money and for how long. I'm trying to think why someone would buy the call you sold say expiring in a week that is 30 percent out the money. Chances of getting filled?
Hey. Thanks for the comment. Gotta be honest, not sure what your asking. You mean with my strike? I talked about how I chose my strike I’m pretty sure. Also the chances of getting assigned early are next to nothing. Maybe rephrase your questions. Make a separate comment so I get a notification. I don’t see reply’s. Also, the video I posted yesterday has a few more details.
Hi Brad. Again a great video, thanks for the quality content. Question: Does Robinhood keep track of the average cost as you go along selling CC? Or is there a better way to manually keep track of cost basis? Thanks!
No they do not. And I used to track it, but don’t anymore. The was really no reason for me to do all that work. I just use my basis becuase at the end of the day, that the number that will dictate my capital gains and loses
Hi Bard - Thanks for the reply. Yeah i probably didn't make much sense in the last comment so I will try again. As i said i'm very new to options and over here in the UK options are not very mainstream with very little platforms offering them. I will try and explain my question with an example. I was really trying to wonder if selling calls out the money on volatile stocks eg far out the money have no issues getting filled, I read somewhere before that some people try covered calls and don't get any fills. Example Say I own 100 shares of MSTR stock ( a volatile crypto proxy stock) therefore premiums can be good. Say I wanted to sell a covered call far out the money to recued the risk of my shares getting called away. So I i sell the 450 strike expiring next Friday collecting 6.10 dollars in premium. What I'm wondering is would i receive the money straight away and this position be filled or m i thinking this wrong? I once read for every seller there is a buyer on the other side. I just thought as this was far out the money i may no get my order placed as I see alot of people selling calls like between 10-25 percent out the money. Look forward to your reply and keep up the good work
There furthers out of the money you go the less likely you are to get filled becuase it’s less likely the stock will get there. Remember the other side of the equation is the buy who needs to believe it will get there so they can make money. Once it’s filled the Primium is yours
Thank you for the video. Am I missing something in your VTI example? It was at $296.91, and you said you would select a strike price of $295, which is in the money. Wouldn't you look at $297.50 and above strike prices.
Good but if the stock go down so much that you can't make a covered call with a strike up the price of acquisition? Just wait that it recovers but the money for livehood will stop, or others solutions?
Hey Brad, in regard to rolling options, you said “you do not have to accept that deal”. But can’t the buyer on the other end execute their option before you roll and there’s nothing you can do about it?
@ very informative, thank you. Lastly, to make sure someone doesn’t exercise early, if the stock price is getting very close to your strike, do you close and/or roll it, or do you sometimes like the price go below your sell/put in hopes that it will go back up so you don’t get assigned? Trying to understand more of your strategy. Thanks 👍
No I do not. I have many free mini courses here on RUclips. A book on amazon linked in the description of my wheel videos and a discord for real time access. Also in the description. :) Not a fan of courses. Would rather help in real time or give the videos for free
There can be in very rare cases and I’m far from an up to day CPA, which is why I pay mine a shit ton of money. But… Each contract, even though it’s the same asset, is a “different assest”. So as long as the transaction has a different strike, expiration or both you are generally good. Confirm with a CPA
but brad, you really only make money or lose money IF YOU SELL THE STOCK.. if you hold on to the stock what you make or lose is paper money it does not become profit or loss until you sell the stock correct.....
If you watch my most recent video with a similar TN I break down how much time I spend on the VTI wheel and daily spy outs. Came out to about an hour a week. Ten to 15 min a day
Hello Brad, since i'm an Italian person i can't open an account with RH. But just for information. How much cost the "margin loan" with it ? With Interactive brokers is around 6.3% Thanks for the video. Ciao
When I sold the option it was above the share price. It has since moved into the money. And no it will not be assigned early. It is still well below the buyers break even. Here is a video on why you NEVER exercise and option early and most likely will not be assigned early in most cases ruclips.net/video/Sp2wCYmc3UM/видео.htmlsi=VOSMufUZaU8XjcZK
@@BradFinn Love Your Passion about the subject someone else is charging 997.00 for a course on How to sell Covered Calls weekly. I am glad I found your channel. Waiting for these digital assets to invest so I can roll that into something like these and build recurring income. I did subscribe!!!!
I watched your older videos among others years ago, practiced with a small account for a few years, and left my job at the end of February and have been living on selling options, dividends, and keep a 2 year cash reserve. At 60 my goal is to collect social security at 67-70, but would take it earlier if needed. That is why I keep the 2 years cash, and will keep moving the 2 years out if things are looking good. The dividends cover my basic living expenses with a little left over, same for the options. All profits, if any, go to cash, more dividends, more options. Small account, wasn't planning to retire for another 2-4 years, but stuff happens. I don't own a home, lifelong renter. Staying in my old apartment while I make sure all this works and I can at least collect early SS if needed. Then will move to a cheaper part of the country. I prefer index funds to individual stocks.
This is amazing! Great work! I loved hearing about real world success!
@@BradFinn I also, like you said, only sell options. It really does seem to limit downside risk.
You are a very good teacher, I now understand what a covered call is and it excites me to learn more.
Happy to hear that!
Great vid Brad. I watched you many moons ago and you’re one of the reasons I sell options today
Love it. Keep crushing
Excellent video, I’ve been selling CC for 6 months now and was curious what ppls strategy is and I can attest this is great tutorial
Thank you!
Planning on retiring in May, and CC will be one of my streams of income. Thanks for the refresher 👊😎
Music to my ears!
Bringing back the whiteboard. Love it!
Hell yeah. More to come
This is Ny absolute dream. I’m working to be here in my early 40’s.
Keep working hard
Good overview. I like to enter in a covered strangle (buy 100 shares, sell a covered call sell a put) one way is guaranteed to expire worthless if at different strike prices.
Not a bad approach at all
Best video and explanation on selling calls, that I seen on RUclips. Thanks 🙏 bro 😎 you’re awesome 👏 keep up the good work.
I appreciate the kind words
Brad is without a doubt the reason I felt comfortable enough to enter the world of options. Doing the wheel strategy now. LEAPS are next.
Best of luck. Keep up the good work
Thx, very easy to follow. I subbed
Welcome!
How to use NVDA for Covered call & CSP ?
Subscribed....Trying to figure out options and your explanation in this video is great. Can you tell me why selling options is less risky than buying options?
May more things need to
go right for +1 options to profit. Less moving parts when selling IMO
Hello I just ordered your book from Amazon.
Nice
Great Video. Very well explained.
Glad it was helpful!
Do you have any more videos on cover calls you recommend I don’t wanna overcomplicated. I like the idea of just the covered calls.
I have like 25
Thanks!
You should make a vid of your nutrition plan because you look so healthy now!
Thank you so much. 2 years ago I got clean and sober after a life of substance abuse. Now I run 100 mile races.
youtube.com/@bradfinntrains?si=jy96ucJfSppHrawP
@ that’s incredible, I just got into options trading again after a break in 2021-22 where I was more focused on my business. I was shocked when I saw your face! (Not that you looked horrible) Good for you brother!
I like how Fidelity illustrates your true cost basis when selling. Ex: If I sell a $190 Call with $300 premium on the Cost Basis screen, they display that I sold my shares away for $193.
Yeah. In Robinhood that’s listed at the break even price
I'm going to try this.
Best of luck
Minus fees, commissions, cost to write/close contracts, and if called the contract appreciated and ate n2 the stock price upon sale. But basically yes minus a lot of hidden expenses
Need a hug?
Great video Brad! Love selling covered calls. Could you make an updated video on when the current price is FAR below from your cost basis. For example, the stock xyz , your cost basis is $200 for 100 shares, and the current price is now trading at $150. When you look at the option chain on Monday, and you want to pick a $200 strike price, there is zero premium to collect. What would you do in this scenario? Also, the same goes when the covered calls goes ITM? Do you wait until the expiration date to roll your contract out and up, or do you roll before the expiration date? Thanks again for these helpful videos!
Call that bag holding and it sucks. This video should clear up what I would do now
ruclips.net/video/JwSGqqvYvOk/видео.htmlsi=3kQDi49kGalfSbIC
Also, I usually roll everything. Like a boxing match, I never go to a judges decision
@ Thanks Brad for the video!
@ Great analogy! I do the same thing, once price hits my strike price on my cash secured put or covered call, I immediately roll. I don’t wait for expiration, I want to be in control of the trade at all times especially when I sell a put. I don’t wan the shares to be assigned to me if the price keeps falls, same with the call side. I don’t want my shares to be called away. It’s so important to know how to roll properly and how to manage your trades when selling options. Because I know how to roll, it has gotten me out of some bad positions where I was able to turn them around to a positive trade.
@@premiumwheeler how do you roll a position?
Loved this video!! Can you please make a video on how you plan to quit your w2 and use options to fund your life? How long did it take you? How can someone follow your steps to reach the same goal. I also want to do this but need some guidance. Thank!!!!!!!
Essentially I just sell covered calls and cash secured puts. Takes a few years, but is easily scalable enough to generate enough premium to live off of. You just have to be patient
When calculating the cost basis of a stock do you take into account the options premiums and dividends or is it just average purchase price? If you bought 100 shares at $100 a share then sell an option for $100, does your cost basis drop to $99?
I used to track net basis but it just became too much work. So if I’m being honest, now I just use the basis on the shares and don’t account for premium and dividends collected.
Great trading video Brad 🔥
Appreciate it!
This is exactly what I am doing as my early retirement comes in July
Let’s goooo
Excellent
Hi Brad! You are a good teacher. I have been thinking to enter into options trading and watching several youtube videos where options trading are explained. But your explanation is very much convincing me to enter into the option world. I have a question about the Greek 'DELTA' value. You mentioned that lower delta value means the chances of the stock price hitting the strike price at the expiration of contract is less (relatively). I have a question. Suppose the stock price is $10 (cost basis) and the current stock price $13. Here is the scenario. For the covered call if I fix the strike price of $16 (for sure the stock price will not reach $16 at the expiration date) and the price goes to $13 at the expiration date what should I do? should I buy back (buy to close) or I can leave the contract until it becomes worthless. I would appreciate your response.
Covered calls covered puts and leap credit spreads are my favorites.
LEAPS :)
Got a question for you Brad . What if you own 100 shares of XYZ but it is currently in the red ? Still sell a call with the same rules ? In this example you were up on the stock when you sold the option . Just wondering about if you’re not .
I need some help with a covered call. I have sofi at 16.50 strike exp 2/14. Wanted to run the wheel on this but price has moved so much more than expected. Should I roll? Or let the shares get called away and sell a put? Idk what to do.
What does your trading plan say? Yeah that.
Are you mainly doing this strategy using ETFs? Or a combination of ETFs and individual stocks? I am heavy into TSLA, but don't necessarily want to risk getting my stocks called away. I am gun shy after what happen with me selling NVDA covered calls last year. I made decent sum but missed out on multiple hundreds of thousands of dollars. ETFs don't have that much volatility. So, to me they are the best vehicle to sell CC on.
I did my first covered call and it got assigned,once that happens,how are you earning an income? I don't get the premiums when it's assigned,right?
Yes you do
Super super super!!
Good video brad. how much would you go out the money and for how long. I'm trying to think why someone would buy the call you sold say expiring in a week that is 30 percent out the money. Chances of getting filled?
Hey. Thanks for the comment. Gotta be honest, not sure what your asking.
You mean with my strike? I talked about how I chose my strike I’m pretty sure. Also the chances of getting assigned early are next to nothing.
Maybe rephrase your questions. Make a separate comment so I get a notification. I don’t see reply’s. Also, the video I posted yesterday has a few more details.
On the time in force do you keep it at 1 day? Or till close?
It really depends. Usually daily cause I watch the markets everyday
Hi Brad. Again a great video, thanks for the quality content.
Question: Does Robinhood keep track of the average cost as you go along selling CC?
Or is there a better way to manually keep track of cost basis?
Thanks!
No they do not. And I used to track it, but don’t anymore. The was really no reason for me to do all that work. I just use my basis becuase at the end of the day, that the number that will dictate my capital gains and loses
I have a question, does the option premium get paid no matter what? Or does it only go through if somebody buys the option?
It is yours once the option is filled
Hi Bard - Thanks for the reply. Yeah i probably didn't make much sense in the last comment so I will try again. As i said i'm very new to options and over here in the UK options are not very mainstream with very little platforms offering them. I will try and explain my question with an example. I was really trying to wonder if selling calls out the money on volatile stocks eg far out the money have no issues getting filled, I read somewhere before that some people try covered calls and don't get any fills.
Example
Say I own 100 shares of MSTR stock ( a volatile crypto proxy stock) therefore premiums can be good. Say I wanted to sell a covered call far out the money to recued the risk of my shares getting called away. So I i sell the 450 strike expiring next Friday collecting 6.10 dollars in premium. What I'm wondering is would i receive the money straight away and this position be filled or m i thinking this wrong? I once read for every seller there is a buyer on the other side. I just thought as this was far out the money i may no get my order placed as I see alot of people selling calls like between 10-25 percent out the money.
Look forward to your reply and keep up the good work
There furthers out of the money you go the less likely you are to get filled becuase it’s less likely the stock will get there. Remember the other side of the equation is the buy who needs to believe it will get there so they can make money.
Once it’s filled the Primium is yours
Thank you for the video. Am I missing something in your VTI example? It was at $296.91, and you said you would select a strike price of $295, which is in the money. Wouldn't you look at $297.50 and above strike prices.
When I opened the trade it was out of the money. It had moved into the money before recording the video
Good but if the stock go down so much that you can't make a covered call with a strike up the price of acquisition? Just wait that it recovers but the money for livehood will stop, or others solutions?
Many ways to make money in the markets
I was thinking of doing it with stock HNST , what do you think Brad ?
Never heard of it so can’t speak about it
Hey Brad, in regard to rolling options, you said “you do not have to accept that deal”. But can’t the buyer on the other end execute their option before you roll and there’s nothing you can do about it?
Of course they can, but here’s why they won’t
ruclips.net/video/Sp2wCYmc3UM/видео.htmlsi=rDcMLm5kq1aqwaMb
@ very informative, thank you. Lastly, to make sure someone doesn’t exercise early, if the stock price is getting very close to your strike, do you close and/or roll it, or do you sometimes like the price go below your sell/put in hopes that it will go back up so you don’t get assigned? Trying to understand more of your strategy. Thanks 👍
do you offer some classes?
No I do not. I have many free mini courses here on RUclips. A book on amazon linked in the description of my wheel videos and a discord for real time access. Also in the description. :)
Not a fan of courses. Would rather help in real time or give the videos for free
Is there a wash rule on options too?
There can be in very rare cases and I’m far from an up to day CPA, which is why I pay mine a shit ton of money. But…
Each contract, even though it’s the same asset, is a “different assest”. So as long as the transaction has a different strike, expiration or both you are generally good. Confirm with a CPA
@BradFinn thanks. I'm new to options so I wanted some clarity
Are you doing them with futures?
No
Any courses for you to subscribe to?
Your closing explanation is what i need
I don’t have any courses. All my videos are free to learn from or you can jump in the discord
$RSP is one you could look at too. Equal weight S&P that offers weekly options.
💪🏻
but brad, you really only make money or lose money IF YOU SELL THE STOCK.. if you hold on to the stock what you make or lose is paper money it does not become profit or loss until you sell the stock correct.....
Seems like this takes a lot of time, you have to constantly watch all this stuff in real time so kind of a full time job correct?
If you watch my most recent video with a similar TN I break down how much time I spend on the VTI wheel and daily spy outs. Came out to about an hour a week. Ten to 15 min a day
Hello Brad, since i'm an Italian person i can't open an account with RH. But just for information. How much cost the "margin loan" with it ? With Interactive brokers is around 6.3%
Thanks for the video.
Ciao
RH is at 4.25%
Since you are selling a call below the current price it’s currently at, won’t it likely be called away?
When I sold the option it was above the share price. It has since moved into the money. And no it will not be assigned early. It is still well below the buyers break even.
Here is a video on why you NEVER exercise and option early and most likely will not be assigned early in most cases
ruclips.net/video/Sp2wCYmc3UM/видео.htmlsi=VOSMufUZaU8XjcZK
And holy shit was I fat 3 years ago. lol
@@BradFinn hahahah! OMG
What’s your discord channel?
First link in description
how much does your service cost?
My Patreon is the first link in the description of all my videos
Shouldn't have sold the TSLL covered calls I did this past week, cap the gains big time lol 😂😂
Me too! 😂
Just roll that shit :)
@@BradFinnWhen does it make sense to allow assignment vs rolling? My idea, was that since it's a leveraged product, I was fine with letting them go.
The market tends to go up over time, it's better to sell puts.
Oh ok. I’ll write that down
GREAT VIDEO!!! YOU SHOULD MAKE ENOUGH ON RUclips TO QUIT YOUR JOB!
ALREADY DO
@@BradFinn Love Your Passion about the subject someone else is charging 997.00 for a course on How to sell Covered Calls weekly. I am glad I found your channel. Waiting for these digital assets to invest so I can roll that into something like these and build recurring income. I did subscribe!!!!
Thanks for the support
I love you channel please help me become better option trader
No speedy Gonzales here 😂like
:)
Exipration
Don't you get absolutely destroyed by short term capital gains taxes using this strategy?
not sure what you mean.
You have to pay taxes on your short term capital gains.
@@michaelhardy9402 thats something that rarely gets mentioned. Uncle Sam gotta get his.
@@michaelhardy9402you obviously don’t know what selling a covered call
Means
Very alsome
🤔
Why not just let everything expire and make 100% profit every time?
That’s works until it doesn’t work
I agree ☝🏻 I prefer to just let them expire and collect the premiums
Everything is either a potato or not a potato
👊🏻