Selling Options using the Options Wheel Strategy has become a great way to earn monthly income. In this video below I discuss my plans and goals in 2022 for selling covered calls, cash secured puts, and vertical credit spreads. I share my options premium monthly goals as well as what I hope to earn on each trade. I also discuss my strategies on how I plan to reach these new goals. Finally, I discuss my expectations for my retirement returns.
It is now April 8th, 2022, and I want to look at how 2022 is going. So far, I have been able to reach my goals. For January I completed sixteen trades with an average trade of $188. I earned a total of $3,012. For February I had a total of $3,036 on seventeen trades with an average trade of $178. In both months I met the high end of my goal of $2,500 – $3,000 monthly. In March I did not do quite as well. I had premium of $2,541 on fourteen trades with an average of $181.
In March of 2022, I started a new software project and had less time for trading. I believe therefore I only reached the low end of my goal. However, for all three months, I did meet my premium goal by trade. Also, the average for the three months is $2,863. So not a bad start for the year. I also had no assignments or losing trades.
One area of concern is that I do have some puts that are deep in the money on Big and LEG. Both have been hit hard by the supply chain and the interest rate increases. I have still been able to roll them and make premium. But they keep trending down. For LEG it has gone from a high of $59 back in May of 2021 and is now trading around $36. For BIG it was trading around $73 in June of 2021 and is also around $36 now. For LEG, a 50% decrease, and for BIG over a 50% decrease. They both pay good dividends, but I might have trouble rolling them if they decrease into the twenties.
When using the Options Wheel Strategy you typically have a few choices regarding what to do with “In the money” positions. My choices for LEG and BIG will be to continue rolling, take a loss or potentially let them be assigned. If I let them be assigned, I will pick up two good companies that both pay good dividends. I do think long-term they will both come back. I will share what I do in a future post. If you want to learn more about rolling here is a good post on Rolling a credit spread deep in the money.
Going forward I am going to continue my current strategy. However, going to try to do a minimum of sixteen trades each month. For March 2 more trades would have gotten me close to $3,000. Also, I mentioned in the video that I would try a new type of trade each quarter. I am hoping to try something new this month. Looking at Poor Man’s Put. I would buy a put in the money 3 or 4 months out and sell put options against it and see how I do.
Thanks for taking the time to read my post!
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