What do you consider high volatility? 50% 100%.....?? I'll be honest, I don't fully understand that stuff.........I just recently learned what Delta and Theta was, lol.
A couple years ago, I was just like you. Heck, I am still learning every day. I didnt know what an option even was a few years ago. I will die still learning. It is hard on us normal Joe's to figure this stuff out, it is like I am in a boxing match with 1 arm, and the competition is an octopus with 8 arms.I can't help but peek in this thread once in awhile, but I gotta admit, I might as well be trying to read Sanskrit.
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Do you ever sell spreads? I like selling puts, but the one I do it with is a $10-11 stock. I will usually sell the $10 puts but then I buy like an $8 put.......just for protection and to keep me from having to tie up so much collateral. Then I take that 40 cents and buy $10 calls. The problem is I never get put shares and calls expire worthless, so I have net zero. If I would just sell and stop buying......I would do much better.I'm still learning myself, but here's an overview of what I know so far...
You can most easily eyeball it ATM, when the stock is high dollar value (requires too much collateral to be worthwhile) and the option premium is low. This is what you want to avoid.
If it's a lower dollar value (doesn't require as much collateral per contract) stock compared to the premium ATM, and it's a stock that you're familiar with, you've found a winner.
The ticker I've been trading for the last couple months runs a premium of 3-5% the stock price, 1 month out. Example from last month: Stock price was just under $70, Option premium was $3.60, which is just over 5%.
That's $360/month clear profit for every $7000 chunk of collateral...
If you want more detailed explanation, tastytrade on youtube consistently had the best tutorials I've found. Especially the older videos.
Do you ever sell spreads? I like selling puts, but the one I do it with is a $10-11 stock. I will usually sell the $10 puts but then I buy like an $8 put.......just for protection and to keep me from having to tie up so much collateral. Then I take that 40 cents and buy $10 calls. The problem is I never get put shares and calls expire worthless, so I have net zero. If I would just sell and stop buying......I would do much better.
I have only sold call spreads 1 time.....and I admit it didnt go too well.
I love TastyTrades.....we use their scanners and option charts in our trading room.......lot of good information, them guys are sharp!
My buddies are all over UUUU. I guess Uranium is the hot thing now?Sold out of options for a loss. Riding URNM up.
I've gone with URA for the sector and dividend.Sold out of options for a loss. Riding URNM up.
I've gone with URA for the sector and dividend.
I've got a couple more positions in the uranium world, but URA is my largest.