Pro Tips tagged #options-education
Hands-on playbooks for premium sellers: expirations, position sizing, rolling and repair — with concrete numbers, not vibes. Included with YieldCove PRO.
$AMZN slips below its 50-day; its $230 put pays 1.8% in 35 days
$AMZN sits under its 50-day but above its 200-day. The Oct 30 $230 put pays $4.075 (18.48% annualized) with a 9.55% cushion, but earnings are estimated Oct 29.
$HOOD cools after a 19% bounce; its $104 put pays 2.9% in 35 days
$HOOD is giving back part of its 19% September bounce. Its Oct 30 $104 put, at the 50-day average, pays $3.005 mid (30.13% annualized) with a 14.91% cushion.
$SPCX shrugs off a 328M-share unlock; its $135 put pays 2.3%
$SPCX held flat through its big insider unlock. Its Oct 30 $135 put, at the IPO price, pays $3.05 mid (23.56% annualized) with a 10.98% cushion.
At Expiration, the Closing Price Is Not Confirmation
Exercise-by-exception sets a default, not a guaranteed assignment outcome. One put example separates the closing price, the holder’s choice and the full cash payment if assigned.
Put Delta Is Not an Assignment Forecast
Delta estimates price sensitivity, not a promise about assignment. A −0.30 example separates a $30 price response from the full $5,000 purchase obligation.
Option Quotes Have Two Prices: Measure the Bid–Ask Spread
An option’s bid and ask can hide a large dollar gap inside an attractive premium. Convert the spread into dollars per contract before comparing wheel returns.
Cash-Secured Is Not Downside-Protected
A cash-secured put reserves the purchase cash, but that reserve does not cap the stock's downside. Start with assignment-ready math before treating premium as income.
A 48.7% Annualized Wheel Yield Is Not a Forecast
A $2 premium on a 30-day $50 cash-secured put is 4.0% for the contract period and 48.7% when simply annualized—but assignment, downside and idle capital make that display very different from an expected return.
Rolling an option is two trades, not a reset button
A net credit can hide a realized loss on the old contract and a fresh obligation on the new one. This worked example separates the close, the new open, collateral, assignment risk and the journal math.
The VIX is not your stock's IV: a better wheel checklist
The VIX closed at 15.67, but BlackRock still jumped 6.61% after earnings. This three-layer checklist separates market volatility, single-stock pricing and event risk before a cash-secured put or covered call.
Covered calls before ex-dividend day: assignment in plain English
A covered call can be assigned before expiry, and a nearby ex-dividend date can raise that risk. Here is a beginner-safe way to separate intrinsic value, time value and dividend timing before surprises reach the account.
GOOGL CSP research: premium with a defined cushion
A beginner-friendly review of one liquid cash-secured put from Eddie's watchlist, including technical, volatility, valuation, catalyst and assignment-risk checks.
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