This. Selling stock short has unlimited downside risk. Writing puts the max loss is if the stock goes to zero. Write a $15 strike put and your max loss is $15 a share if the stock goes to zero. This is one reason I wont write puts out beyond a month or so. Writing them on SPACs is just amazing because they cant go to zero with the Nav floor being $10.
People have went bankrupt shorting TSLA. The cult of Elon is not one to bet against.
Growing a steady 2.5% - 3.5% every two weeks is a much larger gain than anyone here posted they had last year. I think my post of 44% in a year was the highest I saw. The big bet “I made $#k today!” posts aren’t really the norm and those posts aren’t accompanied by the losses.Exactly. For example I thought it would be a good idea to own JCI(pays a dividend, mostly stable, etc). as part of my long term goal. Overall I am up over 100%, but this is after about a year and of course I am still holding the stock.
So for me a somewhat aggressive(either at strike or close to it) put was a way to try and get more of that stock and if the prices rises no big deal, I got paid to try. Typically the premium was around 2.5-3.5% of the strike. With a 2 week put and doing this at a rotating level I was basically growing my account by a measly 2.5-3.5% every two weeks. Not the kind of gains you guys brag about, but over the course of a year it works out to basically doubling my money(i think) year over year for(in my opinion) fairly low risk. Same concept with a covered call.
Example of what I did the last two weeks, 1500$ cash, sold a put for almost all of it(1478 or something) for 38$ expiring at the end of the week, this is about 2.2%. So to you big boys this 38$ is a joke, but it also took me 10 minutes and is fairly low risk. 38x52(weeks a year) and I made 1,999$. Or almost double my original 2k. Obviously getting that 2.2% every time isn't a guarantee(sometimes its 1.x%) and at some point I may actually have to buy the stock but then I reverse the process with a covered call.
Anyway that is what I was doing and it wasn't terrible but unless you feed the machine it doesn't really grow at any huge rate.
I know you guys will turn that 2k into 2.5k in a day and then do it again tomorrow. Wish I could do that and I am actually starting to get interested in advancing my skills around here to do just that...with more realistic goals, like turning that 2k into 2.1k regularly
Market will stay irrational far longer than you can stay solvent.
We are looking at putting together an options how-to thread.
I had the potential (sold the top before covid crash on Feb 11th 2020), but played it far too conservative buying back in.
Not sure. Only a few people posted their yearly.
I was up around 250% (unrealized) but total $$$ is small potatoes.
Im up around %150 or so with my play money. Started last March with about $12500 and currently at $31000.
