The Wheel Strategy Most Frequently Asked Questions
Рет қаралды 13,382
4 жыл бұрынTrading Options For Beginners (10 FAQ's I Get About The Wheel Strategy)
Many people are starting to trade options. I trade options on Robinhood as well as other investing apps. The most common option trades that I do are called Cash Covered Puts and Covered Calls. This is known as the wheel strategy. In my videos about Cash Covered Put and Covered Calls I received some amazing questions.
• The Wheel Strategy
In this video I will answer the most common questions I get about the wheel strategy and Covered Calls and Puts.
👉🏻Come Chat. Free Discord Server: / discord
🔥🔥 Patreon Support For Total Access To All My Financial Decisions & Private Discord Chat! / bradfinn
📷Follow Me On Instagram: thefinnmind...
🍺BEER MONEY DONATIONS🍺
Venmo: venmo.com/TheFinnMindset
PAYPAL: paypal.me/bradfinn322?locale....
🙋🏻♂️Don't Put Your Eggs In One Basket! I Have Multiple Brokerage Accounts!
👉🏻👉🏻M1 Finance: m1finance.8bxp97.net/eLDV6
👍🏻👍🏻Webull: www.pubtrack.co/9QF2KNC/91Z47C/
📞Give Me A Call To Talk Money or KZfaq: clarity.fm/bradfinn
🕺🏻The Easiest Way To Invest If You Know Nothing!! Invest Your Spare Change From Debit Card Purchases Using Acorns: www.pubtrack.co/9QF2KNC/4WNR4Z/
💻 Email: TheFinnMindset@gmail.com
I Track ALL MY FINANCES AND INVESTING in ONE PLACE. The FREE APP👏🏻 Personal Capital! share.personalcapital.com/x/y...
-----
📚Books That Blew My Mind🤯
Get A FREE BOOK with a free trial of Audible! amzn.to/2JEf2M6
All You Need To Know About Investing: amzn.to/2Y3m0RG
On Financial Freedom: amzn.to/2OjL6nf
On Fire: amzn.to/2Y9tAFn
On Debt Domination: amzn.to/2FeGKt4
On How The Wealthy Live: amzn.to/2Fm060R
--------------------------------------------------------------------------------------------------------
DISCLAIMER: The content discussed in these videos are solely my opinion and should never be used as financial advice. This channel is for entertainment purposes only. Make sure to consult with a professional before making money decisions. This video and description contain affiliate links, which means that if you click on one of the product links, I’ll receive a small commission; all of which helps grow the channel! Thank you for your support!
@BradFinn 4 жыл бұрын
*Wheel Strategy Play List **kzfaq.info/sun/PLKkDvxOyGhXM3KBHOttbobZqzP-uN1-Dw* TIME STAMPS 2:50 What happens if I want to close and option and when would I want to close 5:33 When do you get premiums and why aren't they reflecting my portfolio value 7:41 Do you keep your premium if the option is assigned 8:05 How do you get the "trade options" button 9:36 How do I chose my strike price 11:05 How do I chose my expiration date 11:45 Watch me make a covered call 12:20 How do you get your option fulfilled quickly 13:00 Why are premiums red and green in the options chain 13:40 What happens if the share price hits the strike price BEFORE expiration 14:50 What happens if you have an option during the ex dividend date
@RaulSanchez-zc1jj 4 жыл бұрын
This is EXACTLY the video i needed today!!! Thank you so much for speaking to us little fish swimming in the big pond!
@BradFinn 4 жыл бұрын
Trust me Raul, I'm swimming right beside you but we will learn and succeed together.
@jamesgalloway4968 4 жыл бұрын
Another great video thank you Brad. I really like all your videos and the Options videos have been extremely helpful. Thank you.
@BradFinn 4 жыл бұрын
Glad to help. have a great day!
@trevorhassel8296 4 жыл бұрын
awesome video Brad! Excellent breakdown. Options can be a very fascinating way to invest!
@BradFinn 4 жыл бұрын
Thank man. It's been a long time coming. So may good questions come across my desk
@raymondc5874 3 жыл бұрын
Watched this again. This video cleared a lot of ambiguity with options.
@BradFinn 3 жыл бұрын
Glad it helped
@ThinkMoneyBenny 4 жыл бұрын
"Don't do this with shares you're married to that you don't want called away.." almost lost my Abbvie shares last week, not trying that again! lol great vid
@BradFinn 4 жыл бұрын
Haha
@nickl3872 3 жыл бұрын
You can buy them back , who cars is not like you're selling your favorite car
@paovue2638 3 жыл бұрын
What do you guys mean by that? Don't sell the one you want to hold for a long time??
@mandyberglund7811 2 жыл бұрын
I feel this so much!! I turned 40 this year and I just started with options 3 months ago. One of the other channels that I follow is SMB Capital, and I see these kids giving presentations and striving to be desk traders, and I’m like, uggh I’m trying NOT to work that hard!! 🏖
@BradFinn 2 жыл бұрын
Yeah.. forget that noise!
@mandyberglund7811 2 жыл бұрын
@@BradFinn I just realized I commented on the wrong video! 🤦♀️ This was meant for the “Technical Analysis Question” video you posted last week. But the message still stands! 😊
@Infinitelightwizardry 3 жыл бұрын
Thank you, this made things a lot clearer for me🙏
@BradFinn 3 жыл бұрын
Glad it helped!
@Coda1850 4 жыл бұрын
Good vid. Helpful stuff, ty.
@BradFinn 4 жыл бұрын
Sweet! Good luck
@aazevedo225 4 жыл бұрын
Great breakdown! I had to learn some of that the hard way, but with good stocks your risk is pretty low still.
@BradFinn 4 жыл бұрын
Sure is! I love this strategy!
@financialempowermentwithbr8813 3 жыл бұрын
Thanks Brad i am about to get up to 100 shares of AT&T then do some cover calls.
@BradFinn 3 жыл бұрын
Right on!
@JSantos722 3 жыл бұрын
liked, subscribed, commented. That's how helpful this video is
@BradFinn 3 жыл бұрын
Thank you so much
@doctorhorton 4 жыл бұрын
Thanks Brad!
@BradFinn 4 жыл бұрын
No problem
@jeffbarrett791 4 жыл бұрын
This Video answered many of my questions thank you. One more for you - Are there any good sites or Reddit threads (not /WSB) that discuss good/current stocks for Wheel strategies? I am looking at TNA, BAC, GPS, T, PFE as I work to build more cash collateral for Puts but just be good to keep getting ideas and staying current
@BradFinn 4 жыл бұрын
I pretty much just use the comments here in KZfaq as well as my discord chat
@techaponsornloon3827 3 жыл бұрын
You made the best video. Thank you.
@BradFinn 3 жыл бұрын
Thank you
@davidrajcula5839 4 жыл бұрын
Brad, thanks for your clear communication. I now understand that selling made me more premium and now I will earn more as I sell the put. I receive the dividend as long as I own T on its next Ex-div date, right? Ex-Div Date Pay Date 08 Oct 2020 02 Nov 2020
@BradFinn 4 жыл бұрын
Yes, 14:50
@babycutezz5665 3 жыл бұрын
Thanks for your explanation. What do you think about a paper in CBOE written by Professor Oleg Bondarenko that the annual compound return of S&P is still better than write put S&P?
@BradFinn 3 жыл бұрын
Never heard of it
@hallpaintandbody7717 4 жыл бұрын
300 shares of a risky stocks got assigned, $48 premium, -$48 capital gains +$50 dividends. Bought one share each of LMT JNJ AVY MMM KMB WM SPG KO CISCO CAT 1/4th of APPL. I'LL try options again in the near future. Thanks for the info 👍
@BradFinn 4 жыл бұрын
No worries. Good luck
@janedoe3048 3 жыл бұрын
What time of day do you buy your options? Is there a specific day to buy options?
@BradFinn 3 жыл бұрын
I start looking when the market opens. Watch them throughout the day Monday. Some wait till Tuesday
@jaketaylor3151 3 жыл бұрын
Brad on a covered call how do you lose money? Additionally you mentioned they could force you to buy the 100 shares how and when does that happen?
@BradFinn 3 жыл бұрын
My covered call video is located in my "Wheel Strategy" Playlist. Its gotten amazing feedback. good luck
@papijelly 4 жыл бұрын
Thanks Brad, I have to try again, I misunderstood the first time I tried two weeks ago with a stock and it was trading at 19$ I sold a put at 22$ but the stock when down to 18:50. So I got assigned, not that bad as I want the stock anyway so I'll ridet it back up. But I'm still confused about the premium I see it on the statement but not on the account . Now I learn buy to close, Thanks, I'm thinking I. Would have traded the premium to break even. And last question is the covered put with the idea the stock will go down and the call with the idea the stock will go up?
@BradFinn 4 жыл бұрын
It depends on if you want the contract to be assigned or not. Its more about choosing a strike that you wouldn't mind buying 100 shares at or a strike that you wouldn't mind selling 100 shares of
@papijelly 4 жыл бұрын
@@BradFinn got it
@jagurnaut43 4 жыл бұрын
What would be an good example of when one would sell a cash covered put at a strike price that is already above the share price? Would it a be a bullish strategy with expectations it will shoot up before expiration? Or would that contract get assigned immediately after you open the contract? Loving the videos btw
@BradFinn 4 жыл бұрын
I don’t really know anyone who would want to do that. Yes it could be exercised immediately or it could sit. Way more of a gamble than I’m willing to mess with
@luisruiz9604 3 жыл бұрын
Brad, do you offer coaching and more thorough explanation? Or know anyone that you trust?
@bijayataray3992 3 жыл бұрын
when the Expiration hit and you are forced to buy the shares, will it be from the collateral or you have to pay extra?
@BradFinn 3 жыл бұрын
The collateral you put up as the strike price plus $100. That is the Collateral that you were used to buy the one of the shares. This is assuming that you were not on margin
@thatdividendguy 3 жыл бұрын
New question the call went through I received the 300$ premium and I sold my shares for 4k. The premium is in my account but the money from selling the shares wasn't added will that be there on Monday?
@BradFinn 3 жыл бұрын
Usually by midnight for me
@VijaySingh-we6wp 3 жыл бұрын
great video, when can I buy back my stocks, if my covered calls were excercised? like if say tomorrow my 100 shares of wells fargo are excercised, and I want to repeat the cycle, how soon can I buy back those 100 shares? great content and thank you :)
@BradFinn 3 жыл бұрын
Immediately.. but it won't be fulfilled until the open of the next trading day. Or you can do a put and get them back with some more premium
@trystwithlight 3 жыл бұрын
@@BradFinn can you expand on "you can do a put and get them back with some more premium". thank you!
@TooHappyCamprs 4 жыл бұрын
A lot of this is based on being able to put down a good sum of money. What stock(s) do you recommend if you only have $500 - $1000 to play with? Thanks.
@BradFinn 4 жыл бұрын
"A good sum of money" is relative to how much money you have. If you only have $500-$1000 you would need to look at stocks with share prices of $5-10 so that you could purchase 100 shares of the stock
@TooHappyCamprs 4 жыл бұрын
@@BradFinn I understand that... I'm asking what $5-10 stocks do you think are worthy?
@BradFinn 4 жыл бұрын
🤷🏻♂️ I don’t own any stocks at share price.
@theBJC36 4 жыл бұрын
Can you go over the Tesla 5/1 share split? I don’t fully understand it. To me it seems that I will have 5 shares now since I own 1 and that if the stock goes up $10, does that mean that each share will go up $10?? Am I understanding this correctly or is there something I’m not seeing?
@BradFinn 4 жыл бұрын
Everything will get split by 5. Essentially that means NOTHING for the share holders. The “pizza” is the same size. They are just slicing up each piece 5 ways. So if you have 1 share and the price is $500 then you will have 5 shares and they will each be $100
@raymondc5874 4 жыл бұрын
Pls show iron Condor, Call debit spread next. I kinda understand them, but need some practical examples you have always provided. Thanks
@BradFinn 4 жыл бұрын
Yeah its coming. Spreads will be first because they are the back bone of the condor
@raymondc5874 4 жыл бұрын
@@BradFinn awesome can't wait. Enjoyed options a lot.
@BradFinn 3 жыл бұрын
Iron Condor Video: kzfaq.info/get/bejne/q6x4m9J0vMC2nqs.html
@Sam-zh8jd 3 жыл бұрын
Regarding Sell Put strategy: can that be used to purchase a stock you think may go higher than the strike price? For example, ABC Co stock price is at 20 and the premium for a Sell Put at strike price of 21 is 1.25 per share. That means I get $125.00 premium for writing that Sell Put option. Let's say the price reaches strike price on expiration, that will cost me 2,100.00 compared to 2,000.00 when I wrote the option. It may seem like I lost $100.00 but I actually netted $25.00 profit from the original $125.00 premium. So my cost per share is still 20 instead of 21, because I used money from the premium to pay for it. This seems like a good strategy to get insurance on a stock you think may go higher and not wanting to miss out on. What are your thoughts about this?
@BradFinn 3 жыл бұрын
Or the buyer can exercise immediately and you pay 21 for a 20 and now it NEEDS to go up. You can use any strategy you want but tend not to pay more for something than its worth
@tannerlewis19 3 жыл бұрын
What if I buy a covered call at a strike price of $80. And then when it expires the stock price dropped a lot to $60. Would I lose money? Or do I get to keep all my money plus the premium?
@BradFinn 3 жыл бұрын
what you "buy" you pay premium, you do not collect it. When you "Sell" you receive the premium upon fulfillment and it can not be take away from you
@davidsherer5887 3 жыл бұрын
what are the risks or downsides of selling penny stock options?
@BradFinn 3 жыл бұрын
No idea. I don’t do it
@lanwan 4 жыл бұрын
Enjoy your vids and even bought the Simple Guide to Wealth Book you recommended. This is a good ‘how to’ guide to Covered Calls and Puts... but no explanation of why?? Yes to make money, but what’s the rationale behind them ☹️
@BradFinn 4 жыл бұрын
Cause I like money🤔 check out the wheel playlist. I go through the deeper details of why I like it
@johnmoody8578 3 жыл бұрын
Hello brad have a question. Brought a covered call deep in the money. It’s about to expire 15 Jan. If it doesn’t get assigned and just expires. What will happen? Brought a $1 strike, just wanting to know what will happen at expiration.
@BradFinn 3 жыл бұрын
not sure what you mean by "brought a covered call" or "if it doesn't get assigned".. if brought means bought then you have the power to assign any its in the money. If you meant sold a cc then you will be assigned if an option expires in the money
@johnmoody8578 3 жыл бұрын
I accidentally placed a sell call it was my first time in options I did a deep in the money with a strike of $1 long story short it ran up and now it show the 200 shares that I have that are being used as collateral and a sell call that shows negative if I let it expire will I receive what I paid for the option or will I receive the strike price?
@sergiolopez1855 3 жыл бұрын
Found it! You said to skip the options play on the ex dividend date so you don't recommend a company like O for covered calls that only has monthly options?
@BradFinn 3 жыл бұрын
I dont recommend anything. I am not a financial advisor
@sergiolopez1855 3 жыл бұрын
@@BradFinn I understand. Appreciate the response
@dakkon74 4 жыл бұрын
You mention basing calls on your cost basis. What do you do for stocks that are far underwater? Examples for me are XOM/WFC. Do you not even bother with calls for those, while you wait/hope for a recovery? Or do you do calls months out, just to get a tiny bit of premium on them?
@BradFinn 4 жыл бұрын
Great question Mike. I’m getting crushed my WFC right now. I’ve been biting the bullet and taking small premiums close to my basis. So weeks I feel like gambling a little and come a little below my basis which obviously isn’t the smartest move.
@dakkon74 4 жыл бұрын
@@BradFinn I've been selling my WFC/XOM calls below my cost basis.
@BradFinn 4 жыл бұрын
Me too 🤷🏻♂️🤦🏻♂️
@adnankazim88 4 жыл бұрын
Why are some contracts for 1 week and some for 4 weeks. For instance CAKE. Also who are placing tbese contracts? Who os on the other end?
@BradFinn 4 жыл бұрын
Each stock has its own frequency of expirations. You are placing the contract. And another person who is willing to make the trade with you is on the other end. It is a contract between two people. The buyer and the seller
@babycutezz5665 3 жыл бұрын
Based on your explanation, when selling put or buying covered call, if the option hits the strike price before expiration date, it does not automatically gets assigned (sold for covered call/bought for selling put) until the buyer close the option (exercise the option) . In Robinhood platform, you said it will be automatically gets assigned at the expiration date. Does it mean other platform may be different? Can you please clarify again? Thanks
@babycutezz5665 3 жыл бұрын
Also, if it hits the strike price before the expiration date, but does not get assigned. Does it mean I can let the option expire and keep the premium instead of buy to close and lose premium? Which one I should choose? Please suggest. Thanks
@BradFinn 3 жыл бұрын
Other may not automatically. Most do.
@BradFinn 3 жыл бұрын
When u close is up to you
@australianinvestmenteducation 3 жыл бұрын
Love
@BradFinn 3 жыл бұрын
👍🏻
@avalon7128 3 жыл бұрын
So if you sell a call below the share price does it automatically get assigned and you lose your shares or does it have to go down to that price before it gets assigned?
@BradFinn 3 жыл бұрын
The buy of the contract can assign at any time the option is in the money. It is at their discretion before expiration.
@avalon7128 3 жыл бұрын
So nothing is ever auto assigned. Its at the discretion of the person who bought the call. Once it hits experiation date thought it automatically get assigned if it in the money or do the buyer have to assign it.
@BradFinn 3 жыл бұрын
Depends on the brokerage. Generally its assigned at expiration if In the money
@ponky5071 4 жыл бұрын
Okay so if I understand it correctly. If I have a 100 shares of a stock and it goes up 10% in one day and I sell a covered call at the high that day and in a couple of days it goes back down 8% and the premium does down a lot then I can buy a call “buy to close” for the smaller premium and now the 100 share are no longer held as collateral.
@BradFinn 4 жыл бұрын
Not sure the numbers and percentage you are using but I think I understand your questions. If you sell a covered call and collect a premium and later on in the week you have the opportunity to sell a contract and pay up a lower premium than you received then you could do that, close the option and your collateral will be returned to you
@ponky5071 4 жыл бұрын
Brad Finn that answered it thanks.
@sasboi3154 3 жыл бұрын
Please please make a video on PMCC!
@BradFinn 3 жыл бұрын
kzfaq.info/get/bejne/gKqTddWjucWvp6c.html
@sasboi3154 3 жыл бұрын
@@BradFinn you are a legend! Thanks
@tysone1254 4 жыл бұрын
I have a Roth IRA but I’m only 14 so I can’t put a lot of money in it and it has a $35 annual fee so I feel like I’m getting ripped off and there is hardly any funds I can put my money into! My mom is a teacher so they have their accounts through Horace mann which I didn’t want to open with in the first place what should I do
@BradFinn 4 жыл бұрын
Yeah that fee is bullshit. $0 with vanguard if your paperless and you can put whatever u want it. That’s sick that you have “earned income” at 14!!
@swcollector5921 3 жыл бұрын
Yeah you can only contribute to a Roth ira if you have earned income.
@Thetatraderz 4 жыл бұрын
Good stuff, getting close to 100 shares of T. Also sold covered calls on NEWT and MAIN, with the premium received bought a share of VYM for free
@BradFinn 4 жыл бұрын
Thats what it is all about. MAIN is monthly expirations right?
@Thetatraderz 4 жыл бұрын
@@BradFinn Yeah I sold a 35 call for october since I rebought my september one a few days ago. I like 30-60 days out, but might do T less than a month once I get to 100 shares.
@steve99912 4 жыл бұрын
Premium is low for T
@davidrajcula5839 4 жыл бұрын
BTW, I recently hit $10,322 in my Robinhood account!
@BradFinn 4 жыл бұрын
Awesome! Nice milestone!
@TheAndrewLopezFinancePodcast 4 жыл бұрын
¡¡¡¡BuT bRaD, oPtIoNs ArE rIsKy!!!!!
CNBC Television
Рет қаралды 670 М.
Jason Derulo
Рет қаралды 128 МЛН
Brad Finn
Рет қаралды 22 М.
The "Wheel" Options Strategy - A Step By Step Walkthrough Of This Powerful Proven Trading Strategies
Markus Heitkoetter
Рет қаралды 198 М.