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I noticed your QQQ put options were way OTM - I think around 140. What is the theory there? I noticed you get to buy higher quantities, but seems impossible QQQ would ever get in the money. Are you essentially scalping? Or is there benefit to buy higher quantities at otm strikes as opposed to say $5 or $10 Out the money strikes? Thanks!
That's basically it. I want more contracts so that if the market really dives I can have more exponential upside. I'm not betting that QQQ will be below $140 at expiration, only that it will see some big downside action in the next few months.
@@projectfinance that makes sense. Love this. Glad I asked. I’ve been a bit narrow in my approach and setups like this help me broaden my understanding and knowledge of the potential to use options in other targeted ways. Thanks you! Wish I could chat more with you on this!
@@projectfinance and if you are comfortable sharing, when did you sell the QQQ Sept 200p? Profit or loss? Just curious how that turned out and approximately how long do you ‘plan’ to hold typically?
Thank you Chris. I have several sell put contracts that are currently going against me. My broker warned me that they could liquidate positions. What do you recommend I do ? Closing ASAP the bigger put options positions ?
on the covered call warnings, rolling down to purchase can be harsh, but depending on what you write as your call, you can still profit below purchase depending on how deeply your premiums have adjusted your cost basis, especially if you don't just roll down, but roll out.
I think buying otm strikes on the spyders and q's are a much better strategy than the degens buying otm strikes on biotech. You can also make a very good return by not being a degen.
Just a correction there to warn people. If the stock price goes below or hits your strike before expiration, the buyer can still exercise the option forcing you to purchase the stock despite it being before expiration. So be sure to be aware of this, it does happen.
This year is crazy! The VIX do not seem to want to go below 20. If anyone on earth had told me that there will be a time where VIX at 20 is the lower end of the range i would have been like: ''Oh. Yes. Sure. MM-hmm.'', I don't know if you have mentionned it, but with VOL being what it is these day, if you sell puts on the SPY and the volatility goes from 20 to 25, you can capitalise on the IV move by rolling your shorts out in time. It certainly is a challenging market for premium sellers. I tend to focus on lower priced underlyings and i have to do to lots of dynamic hedging. Oh well. Cheers!
tough to say! I think the bear market rallies are always enticing and make us think it's over. The bull case I've been hearing is the market expects the Fed to reverse course and begin cutting rates in early 2023. The market could be running ahead of all that. Falling rates are great for risk assets so that's what I'm watching for. You never know though!
I disagree with you selling covered calls at or above your purchase price, you can sell covered calls below your purchase price and still earn premium. The caveat is if the stock price goes above the strike price you sold then you have to purchase the option to close or buy the strike price above the one you sold to retake your shares back. There's also another strategy but too much to write
Correct. If you've sold enough covered calls over time then your effective purchase price gets lowered by each profitable cycle. I still think it's a good idea to avoid rolling down the call aggressively unless you're trying to get rid of the stock at whatever cost.
Thank you! I am about to launch an options strategy analysis course which will be exclusive and 100% based on data to find profitable strategies. All video lessons. Get on my newsletter to hear when it's out: pfnews.substack.com/subscribe You can scalp options in tastyworks.
Chris as I live and breathe man. Good to see you. I'm kinda hesitant on the puts worried about IV crush. Sounds like it's not something to worry to much about. What about a credit spread or even naked calls with stop loss.
Those can work too. Right now we're in a high volatility market environment, so I wouldn't worry about a rapid IV collapse to the teens. I anticipate the VIX will remain above ~20 for the next few months. I'm watching the Fed policy decisions. If they start talking about rate cuts or a slowing of the hikes, that'll be bullish fuel for the market and bring down the VIX when the market trends higher.
Great Video Chris! Any idea on how to play a stock split ? If you like the company long term, is it better to buy a long term leap or better to sell a cash put option ? The options contract will also split with the stock. I am talking about the Tesla stock split coming up. Thanks.
The bullish idea behind stock splits is it makes the shares more liquid and affordable and therefore can increase demand, but ultimately it doesn’t change anything about the company fundamentals or valuation. We’ve seen examples of the shares pumping after the split but it’s definitely a coin toss. If you trade options before the split then it’s best to make sure your contract size works with the split. If a company does a 5:1 split then you’ll want a contract quantity divisible by 5.
Hi chris,, I did the same strategy you did for 200 STRIKE QQQ SEP 16 But I saw decrease the price what do you think about this. If today july 25 the market when down a little?
Thanks Chris! Same, just waiting to see when a bottom is to buy LEAPs...but then again most of my capital is tied up in big losses now so I'm kinda just screwed..
We'll never know when a bottom is in, unless the Fed starts cutting rates again (which is what they'll do within the next year based on what I'm reading). Scaling into positions is a good way to build into a downside move because it takes away the guessing game of trying to time the exact bottom, which we'll never do consistently.
@@projectfinance are your grandparents living in Poland? Videos disclosing ur recent trades are very interesting. Maybe u could share with viewers more videos regarding ur trading approach.
Sorry Chris, I didn't get the code . In on video you mentioned if I open an account on tastyworks with the code provided by you, I can have access to your signals for options. Now, I want to open an account with tastyworks, buy I don't have your code. Could you please provide me the code? Magdalena
I have a question...... and you my option sensei...... here it is: I'm selling options, vertical spreads, with a stop loss of X3 of the received premium, but many times the stop loss gets filled even when the SPX price still 20-25 usd above/below the current price? im trading at a 0.08Delta and with a spread of 20 between the short and the long call/put. I'm doing something wrong?
Hi Magdalena, You can use this link to get the $200-250 stock signup bonus when funding $2K+ and also the course: start.tastyworks.com/?#/login?referralCode=STOCK_AWARD_2022 You'll have to email me for the course. See email on about page: ruclips.net/user/projectfinanceabout
If your down a lot on a position and want to sell covered calls below your average cost, you can just buy it back if it goes in the money, obviously you know that but why don’t you like that strategy?
@@jimlahey8312 I guess then yes if it continues going up. But if the plan is to never sell the stock under any circumstances, then the covered call probably isn't a good strategy since it'll add a headache at some point
Hi Chris, I had a NVDIA Put 165 strike EXP 07/29. The stock price was falling at 165.10 and was going closer to my strike, however, my put contract value went down whenever it got closer to the strike and raised in value when the stock price was appreciating. The Open interest (9k) and IV (17k) for the contract seemed relatively strong. Do you know why this is? I'm paper trading to learn so no financial pain here, my pride hurts though. Also, it seems that i'm getting delayed pricing since i'm paper trading.
You are trading super short-term options and therefore the option price decay will be significant. Even if the stock moves towards your strike, the option can lose value from the rapid decay. That's likely the big reason for the volatile performance.
Nice tips for the bear market here. I checked out tasty works using your referral link a few weeks ago. It is a really cool platform, glad I made the switch! I've learned a lot from your videos as well as tasty trade's videos too. I hope you get the referral credit! ;)
✅ New to options trading? Master the essential options trading concepts with the FREE Options Trading for Beginners PDF and email course: geni.us/options-trading-pdf
I noticed your QQQ put options were way OTM - I think around 140. What is the theory there? I noticed you get to buy higher quantities, but seems impossible QQQ would ever get in the money. Are you essentially scalping? Or is there benefit to buy higher quantities at otm strikes as opposed to say $5 or $10 Out the money strikes? Thanks!
That's basically it. I want more contracts so that if the market really dives I can have more exponential upside. I'm not betting that QQQ will be below $140 at expiration, only that it will see some big downside action in the next few months.
@@projectfinance that makes sense. Love this. Glad I asked. I’ve been a bit narrow in my approach and setups like this help me broaden my understanding and knowledge of the potential to use options in other targeted ways. Thanks you! Wish I could chat more with you on this!
@@projectfinance and if you are comfortable sharing, when did you sell the QQQ Sept 200p? Profit or loss? Just curious how that turned out and approximately how long do you ‘plan’ to hold typically?
Man, I started my options education with your videos. Glad you're still in my alerts, keep sharing the knowledge!
Thanks for sticking with me 🤙
Hey where do I find places I can talk options? Been driving my friends and family nuts and they don’t care lol.
Maybe there is an options meetup near you. I understand completely!
You're the man Chris... please keep up the good work!
Can you talk about long term deep in the money short put? We will be much appreciated
Thank you Chris.
I have several sell put contracts that are currently going against me. My broker warned me that they could liquidate positions.
What do you recommend I do ? Closing ASAP the bigger put options positions ?
on the covered call warnings, rolling down to purchase can be harsh, but depending on what you write as your call, you can still profit below purchase depending on how deeply your premiums have adjusted your cost basis, especially if you don't just roll down, but roll out.
Cash Secured Puts, take up a lot of buying power out of your Margin Ac.
Yes they do, but less money compared to buying 100 shares at the stock price at the time of shorting the put.
I think buying otm strikes on the spyders and q's are a much better strategy than the degens buying otm strikes on biotech. You can also make a very good return by not being a degen.
Agreed 100p
Awesome video Chris. I always appreciate your content brother. Keep up the good work
I have learned a lot from your videos. Really Appreciate.
Just a correction there to warn people. If the stock price goes below or hits your strike before expiration, the buyer can still exercise the option forcing you to purchase the stock despite it being before expiration. So be sure to be aware of this, it does happen.
This year is crazy! The VIX do not seem to want to go below 20. If anyone on earth had told me that there will be a time where VIX at 20 is the lower end of the range i would have been like: ''Oh. Yes. Sure. MM-hmm.'', I don't know if you have mentionned it, but with VOL being what it is these day, if you sell puts on the SPY and the volatility goes from 20 to 25, you can capitalise on the IV move by rolling your shorts out in time. It certainly is a challenging market for premium sellers. I tend to focus on lower priced underlyings and i have to do to lots of dynamic hedging. Oh well. Cheers!
High volatility environment! Someday we will revert back to an environment where the VIX tops at 20-25 and stays in the teens for years
"Bought 100 Jan 20 2023 Puts - Made bank" When you go in, you go heavy! Way to go Chris! Great video! I really liked the graphics.
Thanks for the feedback Evan!
Do you think its ended now and bull market has begun?
tough to say! I think the bear market rallies are always enticing and make us think it's over. The bull case I've been hearing is the market expects the Fed to reverse course and begin cutting rates in early 2023. The market could be running ahead of all that. Falling rates are great for risk assets so that's what I'm watching for. You never know though!
I disagree with you selling covered calls at or above your purchase price, you can sell covered calls below your purchase price and still earn premium. The caveat is if the stock price goes above the strike price you sold then you have to purchase the option to close or buy the strike price above the one you sold to retake your shares back. There's also another strategy but too much to write
Correct. If you've sold enough covered calls over time then your effective purchase price gets lowered by each profitable cycle. I still think it's a good idea to avoid rolling down the call aggressively unless you're trying to get rid of the stock at whatever cost.
legend, as always much appreciated Chris. Love your work here on youtube.
Thank you for watching! I appreciate the comment.
great CHRIS thank you for your lessons....do you make also private seminars? can we also scalping options in tasty works?
Thank you! I am about to launch an options strategy analysis course which will be exclusive and 100% based on data to find profitable strategies. All video lessons. Get on my newsletter to hear when it's out: pfnews.substack.com/subscribe
You can scalp options in tastyworks.
Brilliant
Thank you
Chris as I live and breathe man. Good to see you. I'm kinda hesitant on the puts worried about IV crush. Sounds like it's not something to worry to much about. What about a credit spread or even naked calls with stop loss.
Those can work too. Right now we're in a high volatility market environment, so I wouldn't worry about a rapid IV collapse to the teens. I anticipate the VIX will remain above ~20 for the next few months. I'm watching the Fed policy decisions. If they start talking about rate cuts or a slowing of the hikes, that'll be bullish fuel for the market and bring down the VIX when the market trends higher.
@@projectfinance and that is the time to buy long strandles right ?
Great Video Chris! Any idea on how to play a stock split ? If you like the company long term, is it better to buy a long term leap or better to sell a cash put option ? The options contract will also split with the stock. I am talking about the Tesla stock split coming up. Thanks.
The bullish idea behind stock splits is it makes the shares more liquid and affordable and therefore can increase demand, but ultimately it doesn’t change anything about the company fundamentals or valuation. We’ve seen examples of the shares pumping after the split but it’s definitely a coin toss. If you trade options before the split then it’s best to make sure your contract size works with the split. If a company does a 5:1 split then you’ll want a contract quantity divisible by 5.
I've watched a few of your vids. They are very educational;-)
Thank you!
great and informative vid as always.
Hi chris,, I did the same strategy you did for 200 STRIKE QQQ SEP 16 But I saw decrease the price what do you think about this. If today july 25 the market when down a little?
Great videos man I’m learning tons ! Thanks so much ! :)
You're welcome and thanks for watching/commenting!
Thx man 😮
Thanks Chris! Same, just waiting to see when a bottom is to buy LEAPs...but then again most of my capital is tied up in big losses now so I'm kinda just screwed..
We'll never know when a bottom is in, unless the Fed starts cutting rates again (which is what they'll do within the next year based on what I'm reading).
Scaling into positions is a good way to build into a downside move because it takes away the guessing game of trying to time the exact bottom, which we'll never do consistently.
@@projectfinance Agreed!
Excellent vídeo and very sound notions. I have never invested in options, but I am considering giving it a try. Thanks.
Very informative. Greetings from Poland!!
Thanks! Fun fact: I am 50% Polish.
@@projectfinance are your grandparents living in Poland?
Videos disclosing ur recent trades are very interesting. Maybe u could share with viewers more videos regarding ur trading approach.
Is there a vid on how to trade long vol?
Thank you
You're welcome!
Sorry Chris, I didn't get the code .
In on video you mentioned if I open an account on tastyworks with the code provided by you, I can have access to your signals for options.
Now, I want to open an account with tastyworks, buy I don't have your code.
Could you please provide me the code?
Magdalena
@@magdalenabuche57 Here it is start.tastyworks.com/?#/login?referralCode=STOCK_AWARD_2022
I have a question...... and you my option sensei...... here it is:
I'm selling options, vertical spreads, with a stop loss of X3 of the received premium, but many times the stop loss gets filled even when the SPX price still 20-25 usd above/below the current price? im trading at a 0.08Delta and with a spread of 20 between the short and the long call/put. I'm doing something wrong?
Your spread can double or triple in value without it becoming ITM, especially if you're selling cheap far OTM spreads.
Hi Chris, how can I use your access code to register with tastyworks, in order to get your options signals ? Thank you. Magdalena
Hi Magdalena,
You can use this link to get the $200-250 stock signup bonus when funding $2K+ and also the course:
start.tastyworks.com/?#/login?referralCode=STOCK_AWARD_2022
You'll have to email me for the course. See email on about page: ruclips.net/user/projectfinanceabout
Hi Chris, could you please let me know the code for having access to option signal?
Here it is start.tastyworks.com/?#/login?referralCode=STOCK_AWARD_2022
What happens to the premium, at the time expropriation? Does it decay ? And it can be avoided?
Thanks
Options lose extrinsic value as time passes. A 365-day option will lose extrinsic value each day until expiration. It happens gradually.
Chris. Do you send messages via Twitter asking for investment opportunities? Someone contacted me two days ago
no it's a scam
@@projectfinance
I figured that. Thanks 🙏 we need to report it though
If your down a lot on a position and want to sell covered calls below your average cost, you can just buy it back if it goes in the money, obviously you know that but why don’t you like that strategy?
Because you’ll buy back the call for a loss and effectively increase your average share cost
@@projectfinance but if my plan is to hold the stock long term then I’ll would easily make it up in the long run?
@@jimlahey8312 I guess then yes if it continues going up. But if the plan is to never sell the stock under any circumstances, then the covered call probably isn't a good strategy since it'll add a headache at some point
Hi Chris, I had a NVDIA Put 165 strike EXP 07/29. The stock price was falling at 165.10 and was going closer to my strike, however, my put contract value went down whenever it got closer to the strike and raised in value when the stock price was appreciating. The Open interest (9k) and IV (17k) for the contract seemed relatively strong. Do you know why this is?
I'm paper trading to learn so no financial pain here, my pride hurts though. Also, it seems that i'm getting delayed pricing since i'm paper trading.
You are trading super short-term options and therefore the option price decay will be significant. Even if the stock moves towards your strike, the option can lose value from the rapid decay. That's likely the big reason for the volatile performance.
@@projectfinance Understood, thank you Chris!
Nice tips for the bear market here. I checked out tasty works using your referral link a few weeks ago. It is a really cool platform, glad I made the switch! I've learned a lot from your videos as well as tasty trade's videos too. I hope you get the referral credit! ;)