Opening (IRA): SOXL March 21st 20 Covered Call... for an 18.21 debit.
Comments: Adding to my current position at strikes better than what I have on, selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with built-in short call defense.
Metrics:
Buying Power Effect/Break Even: 18.21
Max Profit: 1.79
ROC at Max: 9.83%
50% Max: .90
ROC at 50% Max: 4.91%
Will generally look to take profit at 50% max, add at intervals assuming I can get in at strikes better than what I currently have on, and/or roll out short call if my TP is not hit.
Optionsstrategies
DIS The Walt Disney Company Options Ahead of EarningsIf you haven`t bought the dip on DIS:
Now analyzing the options chain and the chart patterns of DIS The Walt Disney Company prior to the earnings report this week,
I would consider purchasing the 140usd strike price Calls with
an expiration date of 2025-6-20,
for a premium of approximately $1.35.
If these options prove to be profitable prior to the earnings release, I would sell at least half of them.
Bull & Bear Top Options February Week 1AMEX:SPY
Weekly Options 2/4/2025
We are still trading in the same range as last week from $591 to $605. This week we will trade this same range using 15 to 30 minute candle closes for confirmation and stop-loss.
$605 Call 2/18 or 2/21
Entry: Breakout over $600, buy off retest
Targets🎯: $603, $605, $608
$595 Put 2/18 or 2/21
Entry: Breakdown under $600, buy off retest rejection
Targets🎯: $595, $593, $591
Opening (IRA): SOXL March 21st 23 Covered Call... for a 20.87 debit.
Comments: High IVR/IV. Adding to my position at a break even better than what I currently have on. Selling the -75 call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 20.87
Max Profit: 2.13
ROC at Max: 10.21%
50% Max: 1.07
ROC at 50% Max: 5.11%
Will generally look to take profit at 50% max, add at intervals (assuming I can get in at a break even better than what I currently have on), and/or roll out the short call in the event take profit is not hit.
Opening (IRA): TQQQ March 21st 71 Covered Call... for a 67.75 debit.
Comments: Starter position, selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 67.75/share
Max Profit: 3.25
ROC at Max: 4.80%
50% Max: 1.63
ROC at 50% Max: 2.40%
Will generally look to take profit at 50% max, add at intervals (assuming I can get in at break evens/strikes better than what I currently have on), and/or roll out short call if my take profit is not hit.
Opening (IRA): INTC Feb 21st 15/19/20/24 Skinny IC... for a 2.04 credit.
Comments: High IVR/IV (91.4/69.7) earnings announcement volatility contraction play. Going "skinny"/"almost iron fly" here. For purposes of take profit, treating it as an iron fly, where I generally look to take profit at 25% max.
Metrics:
Max Profit: 2.04
Buying Power Effect/Max Loss: 1.96
25% Max: .51
ROC at 25% Max: 25.0%
Opening (IRA): UPS June 20th 90C/March 21st -115C... for a 19.60 debit.
Comments: Buying the back month 90 delta call and selling a front month that pays for at least all of the extrinsic in the long such that the break even is at or below where the stock is currently trading.
Metrics:
Buying Power Effect: 19.60
Break Even: 109.60/share
Max Profit: 5.40
ROC at Max: 27.6%
I generally look to take profit on these at 110% of what I put them on for and/or roll out the short call if my take profit isn't hit.
Opening (IRA): TAN February 21st 32 Covered Call... for a 31.17 debit.
Comments: Still in the top 5 underlyings for IV on my ETF board, with 30-day at 35.0%. Adding at strikes better than what I currently have on after exiting the 33's at 50% max. Selling the -75 delta call against stock to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 31.17/share
Max Profit: .83
ROC at Max: 2.66%
50% Max: .42
ROC at 50% Max: 1.33%
Will generally look to take profit at 50% max.
Opening (IRA): TNA March 21st 38 Covered Call... for a 36.24 debit.
Comments: Adding in at strikes better than what I currently have on, selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 36.24/share
Max Profit: 1.76
ROC at Max: 4.86%
50% Max: .88
ROC at 50% Max: 2.43%
Will generally look to take profit at 50% max, add at intervals (assuming I can get in at break evens/strikes better than what I currently have on), and/or roll out short call should my take profit not hit.
Opening (IRA): SOXL March 21st 20 Covered Call... for a 17.96 debit.
Comments: High IVR/IV plus weakness. Adding at strikes better than what I currently have on, selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/ Break Even: 17.96/share
Max Profit: 2.04
ROC at Max: 11.36%
50% Max: 1.02
ROC at 50% Max: 5.68%
Opening (IRA): IBIT March 21st 50 Covered Call... for a 47.78 debit.
Comments: High IVR/IV. Selling the -75 call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 47.78
Max Profit: 1.22
ROC at Max: 2.55%
50% Max: .61
ROC at 50% Max: 1.28%
Will generally look to take profit at 50% max, add at intervals (assuming I can get in at a break even better than what I currently have on), and/or roll out the short call in the event take profit is not hit.
Opening (IRA): TQQQ March 21st 69 Covered Call... for a 65.42 debit.
Comments: High IV + weakness. Selling the -75 call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 65.42
Max Profit: 3.58
ROC at Max: 5.47%
50% Max: 1.79
ROC at 50% Max: 2.74%
Will generally look to take profit at 50% max, add at intervals (assuming I can get in at a break even better than what I currently have on), and/or roll out the short call in the event take profit is not hit.
MSFT Microsoft Corporation Options Ahead of EarningsIf you haven`t bought MSFT when they reported 49% stake in OpenAI:
Now analyzing the options chain and the chart patterns of MSFT Microsoft Corporation prior to the earnings report this week,
I would consider purchasing the 430usd strike price Calls with
an expiration date of 2025-2-21,
for a premium of approximately $15.35.
If these options prove to be profitable prior to the earnings release, I would sell at least half of them.
Opening (IRA): XBI January 17th 92 Covered Call... for a 90.47 debit.
Comments: IVR/IV isn't fantastic here at 11.1/26.3%, but there is some IV skew to take advantage of on the call side -- 31.34% at the 92 call relative to 26.62% at the 92 put.
Selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put to take advantage of the IV skew and the built-in defense of the short call. From a charting standpoint, the break even sets up nicely with the "RFK, Jr. low" in November.
Metrics:
Buying Power Effect/Break Even: 90.47
Max Profit: 1.53
ROC at Max: 1.69%
50% Max: .77
ROC at 50% Max: .85
Opening (IRA): TMF Feb 28th 35 Covered Call... for a 33.98 debit.
Comments: High IVR/IV at 40.7/44.2, which is no surprise, since this is a bullish 3 x leveraged 20 year paper exchange-traded fund. It does have a dividend that pays out quarterly in March, June, September, and December (annualized yield of 4.71%).
Selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call. Using the February 28th expiry to keep things in that 45 DTE wheelhouse and will look to add at intervals, assuming I can get in at strikes/break evens better than what I currently have on.
Metrics:
Buying Power Effect/Break Even: 33.98/share
Max Profit: 1.02
ROC at Max: 3.00%
50% Max: .51
ROC at 50% Max: 1.50%
Will generally look to take profit at 50% max, roll in-profit short call out to reduce my break even.
Opening (IRA): TLT April 17th 82 Covered Call... for an 80.60 debit.
Comments: Laddering out at strikes better than what I currently have on (Feb 87's, March 84's). Selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short calls. Plus, gotta be in shares to grab that divvy.
Metrics:
Break Even/Buying Power Effect: 80.60/shares
Max Profit: 1.40
ROC at Max: 1.74% (excluding dividends)
Ordinarily, I take profit at 50% max, but will wait until the dividend immediately preceding the monthly expiry drops before considering taking profit.
Opening (IRA): TLT February 21st 87 Covered Call... for a 85.97 debit.
Comments: Going long at or near November lows, selling the -75 call against shares to emulate the delta metrics of a 25 delta short put, with the built-in defense of the short call. I'm also looking to snag the January and potentially the February dividends here. This is a bit longer-dated than I ordinarily like to go, but I'm not doing a ton here besides waiting for January setups to come in/be managed.
The obvious variant is to sell the standard -30 delta against: TLT Feb 21st 94 covered call, 89.72 debit, 4.28 max. 4.77% ROC at max where the short call is paying >1% of the strike price in credit.
Metrics:
Buying Power Effect/Break Even: 85.97/share
Max Profit (ex. dividends): 1.03
ROC at Max: 1.20%
50% Max: .52
ROC at 50% Max: .60%
Will generally look to take profit at 50% max after at least the January dividend drops.
Opening (IRA): TLT March 21st 84 Covered Call... for an 82.72 debit.
Comments: Laddering out into 2025 at strikes/break evens better than what I currently have on, looking to snag January, February and potentially March dividends ... .
Metrics:
Buying Power Effect/Break Even: 82.72/share
Max Profit: 1.28
ROC at Max: 1.55%
50% Max: .64
ROC at 50% Max: .77%
Opening (IRA): SOXL March 21st 29 Covered Call... for a 26.85 debit.
Comments: High IV; starter position. Selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 26.85
Max Profit: 2.15
ROC at Max: 8.01%
50% Max: 1.08
ROC at 50% Max: 4.00%
Will generally look to take profit at 50% max, add at intervals if I can get in at better strikes/better break evens than what I currently have on, and/or roll out the short call if take profit is not hit.
Opening (IRA): EWZ Feb 28th 22.5 Short Put... for a .51 credit.
Comments: After closing my Feb 17th 23 for a small profit, opening up a position at a strike slightly lower than what I just had on, attempting to pick up shares at the lowest price the market will allow. Had to use the weeklies to get into the 22.5.
Full ARKK Reverse Gamma Scalping PositionThe basic essence of reverse gamma scalping is to do additive and subtractive delta adjustments over time to keep delta fairly neutral so that theta can do its dirty work.
Shown here is my full ARKK position that started as a delta neutral iron condor to which (a) I layered in an additional iron condor as a delta adjustment trade; (b) mixed and matched profitable put side with profitable call side to reduce units and/or risk; and (c) did an additive long delta short put vertical as a delta adjustment. Rather than continue showing each of these additive/subtractive delta adjustments as separate trades, I'm setting out the full banana here.
I've collected a net 3.22 in credits on a buying power effect of 11.78, and the position has a delta/theta ratio of -2.09/6.00. With 36 days to go, I'll primarily look at doing profitable subtractive adjustments first; then additive ones.