| Title | : | Selling ITM Call Options - Buying and offering to sell a stock for less to make money? Yes please! |
| Lasting | : | 19.26 |
| Date of publication | : | |
| Views | : | 34 rb |
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Nice explanation Thank you Comment from : RPYellowbelt |
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this was a FANTASTIC explanation crystal clear thanks man Comment from : andrei mc live |
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Hi and thanks for the video I don't understand, in the INTC example, when you say if it goes to $46 and you buy the strike at $47 that here is the downside Is it not the case that you already sold the shares (assigned) you own at 47 at expiration and got the premium and netted a gain because the premium was so good Comment from : Vatreni |
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There seems to be this thought process that if you buy an otm call that you should just look at what the result will be at expiration but we also should also look at what may happen before expiration I see on the Apple option chain the following as an examplebrShare price $14980brExpiration 28 days away brStrike 165brPremium paid to buy is 30 cents per share( $30 per contract)brDelta about 7 percentbrSo yes at expiration if share price is under 165 you lose your 30 cents per share you paid However lets say within a day or 2 of buying the call the share price goes up by $1 With a delta of 7 percent your option value would go up by 7 cents to 37 cents Next you sell to close this option Your return is about 23 percent Comment from : david leonard |
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I have been selling ITM covered calls on few different stocks and doing pretty well Could you explain the advantage of selling ITM CC versus cash secured OTM Put options Yes, the risk profiles are the same and you deploy less capital when selling puts Other reasons? thank you! Comment from : Hasan Koc |
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I need you to help me clarify my situation I sold it in the money call on Tesla I own the stock it 167 I sold an in the money call for 162 The stock price was 167 when I did it I got a 9 dollar premium I am a week away from expiration 😢and the stock is now at 177 How would you handle this if it were you thank you Comment from : G Ajem |
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When selling in the money covered calls, is there always a chance of getting called out at expiration, or does the price of the asset have to drop to that strike price in order to get called out? Comment from : Allendr |
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Can you explain how your annual return is 4211 if early assigned? i didn't get that part Also how did you get to 224 with the dividend if the dividend was around 55? Comment from : MidasMoney |
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is that a real painting behind you? Comment from : Cyphermunk |
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Excellent video Thanks Comment from : john snow |
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INTC is a stock I’ve owned a long time Nothing but frustration lately especially with the dividend cut Hopefully they get things turned around Comment from : DC |
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Dave, what's a good place to find the X Dividend date on stocks? Comment from : Greg Esser |
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Dave, thanks for your great videos I have been trading the "usual" covered call strategy for years but still get caught at time with the stock dropping low enough to not be able to write a call due to such low premium Not sure what to do when this happens? At 75 years of age, I use this to supplement our lives! Love it but need some help Comment from : Greg Esser |
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Love your videos Please keep them coming Please let me know if the below strategy makes sense around earningsbrbrA) Sell covered calls at an ITM Strike price just before earnings and collect a nice premium brB) Say the stock drops significantly below the strike price after earnings (and does not recover or comes close to the strike price at expiration)brC) At expiration, you get to keep the premium and also the 100 shares (because the stock was not called away) Comment from : asethu12 |
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good explanation Comment from : Glenn Irwin |
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I need help and you may be the guy to further my education For a price Comment from : James E C |
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When you sell an in the money call which way to do wish the stock price to go? Comment from : James E C |
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I really like your videos, just came across your channel! Question - is there any tax benefit to selling ITM calls (that do get called away)? I but Intel for $28 a share, I sell an ITM call for $26does this strategy help with avoiding capital gains (had I instead sold a OTM call for $29 a share - which got assigned)? Comment from : Wayne Nichols |
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Dave,brIf I buy a stock for $50 and sell the CC for $49, is there still a chance it will be assigned? Also, have you had stocks taken away from you prior to your 30 days being expended, lets say half way through the trade? Comment from : Greg Esser |
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Love your videos If you sell your example at a loss, do you get to write the loss off on taxes? I understand the premium you collected is ordinary income, but can you subtract the stock loss from that…so really, from a tax standpoint, you’re only paying ord Tax rate on the “premium-loss” ($655-$500 in your first example)? TY Comment from : torrensc |
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but if u bought the 145 and it dropped to 144 before exp dont u have to buy it back(close out contract)before u could sell it again at 145 for $100? Comment from : LimitedTimeEnt |
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Could you please do a video on selling in the money put options? Comment from : Keep the Fire Burning |
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Seems like the Intel pattern is still holding hah Comment from : Ditronus |
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I bought a call option two days ago, it is now $423 ITM I have about 10 days to exp, should I sale to close or hold on? Comment from : Kenny Taylor |
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Thanks for sharing Question: does : ITM covered call mean the strike price is below stock price? Comment from : Coach Yam yam |
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Thank for the content, well done Subscribed Would you say this is the strategy for slightly bearish market Comment from : IT |
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If you're selling Covered for yearly return, it's easy to get 20 yearly selling high IV ITM calls Assuming you're buying and selling based on timing, meaning don't buy on tops and sell on bottoms Comment from : Mister Sandy |
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This is the first time I see this on YouTube Thanks for laying out everything so clearly! Comment from : Lille Low |
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Loved the INTC tip Looks solid I wish I watched this 3 days ago before INTC reported 2 days ago and the floor dropped out, lolbrMan I missed the boat, now I have to wait another 3 months Comment from : The Pixal King |
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I want to sell a ITM in the money - SPY Bear Call Spread - To generate a Net Credit premium Why would that lower call NOT get exercised the moment I sold it -- Since that lower leg is in the money right now? The top leg is out of the money so not worried about it How can I determine the odds of being exercised and have to come up with SPY stocks?? Is there any good rule of thumb cause I do not have SPY shares!!! Enjoy your realistic nitty gritty realistic videos Comment from : Richard Scholtz |
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if you think shit going to go down and you may not want to sell Comment from : House of Banelord |
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Thanks for educational video's My broker has a realistic paper trading platform I paper traded an ITM covered call on an ETF Within 5 minutes of selling the call, it was assigned, probably due to an arbitrage trade simulation, which created a small loss! My point is there is always a risk of any early assignment when selling ITM Comment from : dumpling7 |
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thanks great idea! brrecord it a little louder? can t hear in car very well can hear other vids Comment from : Mike Shepler |
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Thanks for your great videos In your Apple example, why buy the stock for 150 and collect only 100 (net) on a 145 call instead of just selling a 145 cash secured put for 152 ? With the call, you make 100 if the stock goes up and it's called away With the put, you would make 152 If the stock goes below the 145 strike, your call expires worthless and you keep your 144 basis stock Whereas, the 145 put would expire in the money, and you end up holding 14348 basis stock What am I missing here ? Comment from : Kevin K |
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Great videos ! What level of options do you need to be on Fidelity in order to see the delta? Comment from : OptionInvestor |
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I sold and closed my first ITM CC after this video, thank you very much for opening my eyes to this for some extra income on shares im not attached to It was great I did notice something I had a question about when visualizing it on optionstrat If I sold an ITM CC and bought a put at the same strike price, optionstrat showed my max loss and gains capped at $2 with wide breakevens I'm long stock at $213 I sold the CC at $1 strike for $150 and if I were to (lets say hypotheticlly because I saw it and questioned it) buy a put @ $1 for $001 On optionstrat visualizer, it shows me that I can collect a net credit of $150 but since I'm long stock, bought a put, and sold a call, what does this do? Your strategy worked great for me and I wasn't assigned but I do understand what happens if I were to be and positioned myself to make a $37 profit What does buying a put at the $1 strike for $001 do for me? I know it limits downside risk but I'm interested in why it shows as 'cancelling out' the trade and leaving me with a capped max loss/minimum loss that both equal $-2 and a net credit of $150 Do I get to keep the full $150 if the stock expires between the breakevens and not worrying about assignment since I'm long? Is it basically losing $2 on the stock but collecting $150 on the option? So you lose on the stock, but win on the option? And the difference between those two is what my total profit is correct? Comment from : StoneInFocus |
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How is this taxed? I assume net profit as STCG and can’t write off the capital loss since you still finished at a profit? Comment from : Mavericksfan1000 |
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Ty Comment from : Picaflores - Barba ,Cuerpo Y Mente |
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thank you for actually describing in different scenarios i cant tell you how many people discuss this topic without explaining "what could happen" Comment from : Wesley Jones |
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This isn’t working out for me I sold a $47 call on Pfizer and it went I rolled it out another week so I think I I want it to go down I’m confused on what is best for me Comment from : jtuno122 |
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Evert time I've tried this (with the stock going ex-dividend), I've gotten my option exercised Maybe I'll try a different brokerage Comment from : Jms Fabrication |
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Like the info and concept It would be great to see a flow of these multiple trades against the same stock to really grasp the long-term potential Perhaps in a spreadsheet format Comment from : Trading |
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If I own 100 shares of BBBY at $1657 but I am down about $623, would it make sense to sell a deep in the money $900 call for $65300? Comment from : sonogirl12345 |
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Been doing this lately with ABNB Large position (1000k shares) and I’m bullish on the company Usually sell 5$ in the money two weeks out Roughly 500$ extrinsic per call 5k take home every time Set your clock to it It’s been VERY volatile but I’m an edgy trader Comment from : Themrfabio24 |
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Dave, Question When writing a Put or Call could you get "put the stock" or "called away" early? or only at final date Thanks, Dave Comment from : Daves Lab |
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You make me excited to try to sell puts or call options Haven't squeezed the trigger yet Keep the videos coming Thanks, Dave Comment from : Daves Lab |
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Thank you for this video (and your others) I feel you are one of the few actual investors explaining logical, sustainable option strategies Too many others are making trades akin to gambling Please keep going This is good information Comment from : Leigh Devereaux |
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