What I can say is, that your videos are like a voice in my head lol, I'm subscribed to a number of channels and listen to lots of smart people with good info and analytics, but your videos are something different, it's like me thinking out loud is sounds so natural to me. I appreciate you posting these videos, they help me much
I agree with your market assessment. Core inflation remains stubborn and consumers are tapped out (credit card debt at all time highs). Consumption drives our economy so watch for corporate profits to drop along with stock prices. Time to get defensive.
Not to mention student loan payments are resuming again Oct 1st, so that won't help things either www.ramseysolutions.com/debt/when-do-student-loan-payments-resume#:~:text=For%20over%20three%20years%2C%20federal,interest%20restarting%20September%201%2C%202023.&text=Yep%2C%20like%20Twitter%20and%20the,is%20coming%20to%20an%20end.
As far as papa Powell goes, he may be creating some real good buying opportunities, I expect this week is going to be one of those weeks, may see a good drop but I also think it will rally after the freak out into 2024. Just my 2 cents since you asked for our thoughts
Great information, I always learn something new from your videos. Changing plans with changing market conditions is a real skill. All this "news" is basically massaged nonsense. I'll be a doom and gloomer until we go trend up, whatever the news. Until then, 0DTE the indexes and Money Markets.
Hi. Had very similar thoughts but you outlined it well. Could you suggest several more stocks may be suitable for this approach besides NVDA, TSLA, AMD etc. Thank you.
For higher priced, I like stocks like ADBE and INTU. For lower priced, I like stocks like DKNG and PLTR. I like those because in the worse case scenario, if I am assigned, I wouldn't mind because I really like the stocks. Make sure to do it on stocks that you really like ,just in case it tanks and you are assigned.
Can you tell me why you use monthys instead of weeklies? Also, what does fidelity charge on commissions? As always great video. A very calm atmosphere.
I am using monthlys for this strategy because I want to make sure I collect the 5% SPAXX interest. The further away from expiration, the less likely I will ever be assigned shares. When you trade weeklys you are giving yourself so many more opportunities for assignment. I have found from my personal experience, that even though the technical returns can be better on paper for weekly options, it never turns out that way in reality. Too many rolls and assignments and trades leave so much more room for error. There is little time for losing positions to rebound, and then panic causes us to make dumb decisions. Monthlys are more predictable and much less stressful for me. Fidelity charges $0.65/contract. But if the price of the option is less than $0.65 when closing it, then the trade is commission free. Also, the fills with Fidelity are amazing. Most of the time the fills are more favorable than what I even submitted.
I love the idea of finding high IV stocks and selling cash secured puts against them. Unfortunately I’m dealing with a $5,000 account and I can’t afford NVDA, TSLA, or even AMD. Do you have any advice for the small account folks out there?
With a small account, I would personally look to trade Poor Man's Covered Calls (assuming you are approved to trade spreads). I made a video about it here if you're interested ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-o3UZV-dzTZU.html .
How does this double dipping work in practice at Fidelity? Is the cash sweep automatic or do you need to trade into and out of a money market account? When you sell puts there is a reduction in your buying power even though the cash is not yet taken out. Do you need to transfer the margin amount out of the money market or can it sit in the money market AND be used to sell outs at the same time? Has anyone been able to do a similar setup as outlined in this video with TD Ameritrade / Schwab?
With Fidelity it is all automatic, you don't need to manually trade in and out of a money market fund. In Fidelity in the "Balances" tab, they show "Cash reserved for option strategies". This cash is automatically put into SPAXX. So the cash-secured Put money is held in reserve while you collect interest.
It seems like there's a big amount of bearish high rate sentiment now,all we need is for some soft data to come in and I think we will see a nice bounce
Great video, i like your videos, question? You say if NVDA aprroaches your strike instead of geeting assinged you would just roll it into next month. Wouldnt the cost to close out the put be significantly higher if NVDA apprached the strike in a big selloff. hte climb up was a straight line
I would try to do the roll for some sort of credit. To make that happen you would need to change strikes and/or go out even farther. If I were unable to roll for a credit then I would just get assigned the shares. I love NVDA anyways, so I wouldn't care too much.
@@yieldcollector absolutely they have a unique technology in their chip, and no one can match their infrastructure. They are going to be rolling in the the money in the next few years. Doesn't mean you can't get cut in half remember Amazon Apple, but right now I think everyone's so very expecting rates to be so high. I think we get surprised in the next month that's just my guess but you can't go wrong on a Nvidia
Excellent video and insight as usual! Thank you. Who else pays a 4 to 5% cash sweep besides Fidelity? I know TD is pitiful but is the only broker I use right now. Time for a change? Do the Options Alpha recommended brokers do better and get a free account? (I think being a bank is the driver for the 4%+ ?)
keep in mind that getting approved for options at fidelity can be a pita. they did not approve me so I'm using Robinhood for that, although I have most of my money at fidelity
Yeah. I am no longer as Bearish as I was. I like to look here: www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html?redirect=/trading/interest-rates/countdown-to-fomc.html .
I’m 62 retiring in six months I would cash other than a few equities like Tesla, Amazon and Google that I am the rest is in a money market making 5 1/4 I left my advisor so that’s another 1.1 protecting assets until the storm blows over your thoughts.
We will get a good dose of the Fed this coming week. Several members, including Powell, are scheduled to speak. No one knows what they are going to say or the markets reaction??
Hi buddy, ive actually been doing that exact double dipping strategy on CSPs, I did run into a problem last Friday, I tried to roll my mpw csp to Nov 17th, but the market wouldn't assign it, I kept refreshing and changing my midpoint and nothing. Finally I called fidelity and they just kinda wasted my last 20 minutes but going the long way around to accomplish the same thing I was doing. Unfortunately the market had closed at that point. I did not have a "market" option while attempting to roll, just the limit option which i kept changing as the stock was rallying at the end of the day. Do you know why that could have happened? My thesis is that the "market" button wasn't an option for me and that's what kept me from rolling. I just want to be prepared for the next one that I may need to roll. Thanks a lot, always enjoy hearing from you.
If I ever have a problem getting filled I just cancel and replace and move the price out of my favor until it fills. Many times the mid price won't fill and you need to move it down several times. I don't really ever use a Market order for these rolls.
@@yieldcollector i cancel and replaced 3 times but I kept using the mid point, maybe I would have been successful if I rolled for the bid price? That was about 5c lower but I was getting 99c/share so I wouldn't have minded 94c. Is that what you meant?
So even though much of your funds are being used to secure a put they will still pay you the 5?. I figured those funds would be ineligible to get the MM %.
This strategy works with Fidelity www.reddit.com/r/fidelityinvestments/comments/13w8pua/spaxx_and_cash_covered_puts/ . Fidelity automatically has SPAXX for their cash sweep program. You have to check with your broker to see what your cash sweep program is paying.
I have all of my bots turned off right now, including the PCS bot (which went on a bad run recently). I never had a bear Call spread bot (although in hindsight I wish I had set one up).
