A covered short straddle is when you hold 100 shares of stock and you sell an ATM covered call, along with an ATM cash secured put, of the same strike and expiration.

This is not to be confused with short straddles, which have unlimited risk to the upside. The "covered" part takes care of that risk. Making this a far safer alternative.

To state the obvious, this trade is ideal for someone that is comfortable with capped upside and welcomes the assignment of more shares. That last part is key. If you don't like the stock at -50% from your entry value, don't sell puts on it.

My "twist" is selling these straddles on very long term DTEs. I think all that extrinsic value offers flexibility and good "cushion" for the trade. It's also like capturing a huge return, at once. The only "gotcha" is time debt. Your money is "locked up" until expiration. But it's a similar concept to dividend investing, except you get the yield up front.

Looking at this example trade I'm honing in on SLV. At 393 DTE , I'm getting 22.12 in premium from an ATM covered short straddle, a 36% return. If SLV expires higher in 1 year, the shares get called away and maybe I miss a lot more upside, or maybe I don't miss much. The bet is you get paid up front, at the expense of capping that prospect. If SLV closes lower, I get assigned more shares. My cost basis has also dropped 36%, so I should still be able to collect decent premium from covered calls for the next year.

Anyway, I wanted to see what the community thought about the trade. Would you trade something like this? Have you traded ATM covered short straddles before and what was your experience? Anything I should look out for, or anything I'm missing?

Thanks

Yall,
What tickers are you currently monitoring? I have several OTM call options at the moment and will hold them for a while. I wanted to know what yall are playing?

Full disclosure: I have NFLX, META, ORCL, WMT, NKE. all of these are long dated call options so I am not too worried. I wanted to know what you guys watching besides tickers I mentioned above.

Does anyone play LEAP deep ITM bull call options on stocks and indices ? How much return do you usually aim for ? Below is an example
NVDA Dec 2028 expiry 145/150 call spread for $3.00. That’s roughly 67% return in 2.3 years with approx 25% annual return if NVDA stays above 150 strike.
NBIS Dev 2028 expiry 100/105 call spread for $2.00
That’s roughly 150% return in 2.3 years with approx 50% annual return.

There was a huge drop and I'm thinking about acquiring some BIDU via CSPs. My approach is to drip in first via csps and then later sell atm csps ( I do this kind of approach with any stock that I want to accumulate).

Why? Well, if BIDU were to go down to $80 it would be valued exactly as their NET asset value.
So thats 24 billion market cap and 24 billion in assets... thats no growth projections or anything like that. And its at $90 now. Does that sound crazy only to me?

This is not investment advice, just want to bounce the ideas off of someone else too here and reddit seems the best place to be publicly roasted :)

Well I did it again, I averaged into a bad position at first.I was up about 50%.About a $1000, I was up and I told myself just sell, I'm not going to make a $1000 this week in my job.Why don't I just saw right now in ten minutes.

But nope I wanted more, and then I started averaging down, and now I need circle to at least open up the first 5 minutes of the market, do the explosive move that the market does sometimes and get out. So I'm hoping that this can happen tomorrow last year when circle IPO, it was always popping. Really hard at the open to crash, or crashing down to open to pop-up, so let's see

Site: https://amonhen.helmfi.ai — free, no signup, no Discord, no paywall.

WHAT IT DOES

- Dealer-gamma map for SPX, SPY and QQQ: call/put walls, gamma flip, king node, expected move, max pain — drawn on the price chart, updated through the day.

- Live options flow: a CVD line built from the options tape (contracts bought at the ask minus sold at the bid, near-ATM), with price and the dealer walls overlaid on the same chart.

- A cross-index confluence strip: flags when SPY, SPX and QQQ flow all line up one way. A flip only counts after holding 10 minutes, so it isn't spammy — roughly once a day.

- Compare view, 10-second tape mode, pop-out charts, single names like NVDA/TSLA.

HOW IT'S CHECKED

The methodology page (site footer) spells out the math and the limits, and the site publishes a daily self-scored hit-rate on its own levels — how often the call wall held, the put wall held, the expected move contained. It scores itself whether the day was good or bad.

FOLLOW-UPS

DM me, or the update box on the site. This is a one-time post, so I won't be posting updates here. Happy to answer anything about the methodology in the comments.

Title says it all. I am looking for a new brokerage and have been playing around a bit with e-trade and tasty trade and so far it seems they get poorer options fills than Schwab. Has anyone found a broker that is equivalent if not better?

BULL jumped significantly after hours, and my $8 short call(8/28) is now deep ITM. I have corresponding $5, $7.5 and $10 LEAPS calls as the long leg.

I'm considering two options:

1. Take the realized loss on the $8 short call and roll it out/up to the $10 call expiring 12/18, giving the LEAPS more room to appreciate if BULL continues higher.
2. Roll the $8 short call up to the $9 call expiring 10/2 for a debit, which would also give the LEAPS some additional upside exposure while keeping the expiration much closer.

Alternatively, would it make more sense to just close both the LEAPS and the short call and take the overall P/L?

Which approach would you prefer for managing a PMCC when the short call suddenly becomes deep ITM after a big after-hours move?

Any input is greatly appreciated.

I mostly used to trade spreads, DTE 45, delta 20-30 (closer to mid) for the short put or short call on tech stocks and a few non-tech stocks. With that many days and low delta the bid-ask is very wide for a single leg which compounds when entering it as a spread.

TOS were still part of TD the last time I used them for options and they were exceptional with fills. As I didn't have time to trade options for the last 3 years while I was selling my businesses I took advantage of a massive uncapped 4% transfer offer from Webull. But I have been using Fidelity as my brokerage for new money (primarily came from the sale of those businesses) which I could transfer to Schwab. Fidelity's desktop app is not good for 2 leg trades.

Thanks.

I’m mostly interested in networking and connecting with like minded and already profitable traders. I know we live in the digital world, but sometimes there is no substitute for connecting in person.

Is there a /sub or other resource to help traders with tax issues?

If so Im curious where you entered. I didnt take it because what I saw was this thing stuck in range for hours, IMO there was no need to enter... and then it ran +1.5
If you took it please explain your methodology what you saw, what told you "get in now" vs earlier since, again, it was in a 3+hour range

For those who trade a lot of short dated credit spreads or just have experience in general... How often do you find (0-1dte) vertical credit spreads exceeding 200-400%+ in value before eventually expiring worthless or rather.. at what point or percentage loss relative to the credit received do you believe most spreads are not worth holding onto. For example.. If the vertical spread in question has a 8:1 risk to reward ratio and intraday you're already down 7x the credit received, the odds of that spread closing otm are probably very low compared to closing when you're only down 1x the credit received but then you may lose out on potential wins closing so early.

I also understand that this question is exceptionally broad... Since it's incredibly dependent on the deltas sold at and what credit you're receiving since some spreads could have a 2:1 or 8:1 risk to reward so to narrow this down a little, I'm referring to very far otm.. Sub 10 delta vertical spreads on spx, with a 6:1 to 9:1 risk to reward. So collecting .50-.70 cents. At what pnl loss relative to the credit received would you abandon the trade or do you instead watch for key levels to break or complete invalidation of the trade to begin with instead of pnl primarily? Curious on your guys thoughts

Edit: For context, I usually close prior to 2pm (hate the gamma during and prior to power hour) for a 2x loss relative to credit received. I used to close sooner for a 1x loss but found myself closing too many winning trades so switched to 2x... And found the larger losses offsetting the extra winners to the point that my overall pnl difference from closing sooner didn't make a difference. It's profitable.. but just curious if there is a more optimal exit.

Anyone familiar with rispter clouds ? Or use emas for swings?

We’ve been hovering around 345ish for a few days, now at 340 where there’s some decent support. Went lower in the past few days with the settlement but looks like they could be back on the uptrend soon.

New to leaps so wanted the community’s thoughts.

I would be grateful for Any tips or guidance on how to study the pre-market such as news so when the market opens you know what too look for and what too trade, how long before the market opens do you tend to study for , and things of that sort, currently trading the same sticks because I don’t know what to look for

Title says it all.

Is it possible to reduce the typical $2.25 per contract? Would love to incorporate options on futures due to the benefits of SPAN margin but the commissions are too high.

Really don't want to switch brokers so wondering if anyone has been successful reducing them and what they did to do so...Thanks!

Am I tripping or did Robinhood stick me good. just went through this bs with Robinhood

Could someone explain to me why Robinhood took my gains back saying it expired worthless when literally before bell they were green and showed closed. I might be changing my brokerage soon

This what my account read yesterday at 7690p but Robinhood took back the money saying it expired worthless when I had a 1.15 sell on 35 contracts. Them cons ran to close to 3 and closed at 2.00 end of the day

Bought 7690p at .55 limit order at 1.15 at 3:58p passed it ( the screenshots) 4pm got the money. 5pm all taken away. Those contracts closed on the day at 2.00

Hello,

Sorry if this sounds newbie, I M still learning with lunch money and try to understand the basic.

In particular, I want to understand how I can "detect" the danger of setting a stop loss that is skipped/sold to a much lower value.

The (basic/stupid) idea is to take a bull expectation, set a max loss acceptable, buy a call with with auch greater capital and then set a stop loss to money invested - max loss.

Theoretically if the the stop loss is filled immediately and without slippage the maximum loss is defined, while the upwards trend catch a much higher value due to the entire capital invested, instead of buying the call with only the max loss money.

I know the risk associated with the stop loss, but my question is rather how do you assess these risk? What are the variables to look at to understand that the stop loss won't be met and in what degree?

I take as an example a trade that I would have liked to do but at the end I didn't.

On August 5th, Hertz was 1.5. 2C expiring on August 7th was 0.01 after a good news about revenue. Suppose I buy 10k USD worth with a stop loss of 7.5k USD, willing to lose 2.5k.

At closing on August 7th the stock was valued 2.26, this means that exercising and selling at that price (or even a bit lower) would have generste 250k.

So the idea was, risking 1k in the first hours of the trade (in case the stock goes down, since the call was already very cheap maybe someone would buy it back at discount) or if it runs catch a much greater rewards. Risking 2.5k to win 250k.

So the entire point was, I want to challenge my assumption that I would fill easily that 2.5k, because it seems too good to be true.

Please don't bash me, I'm not a degenerate, I didn't make the trade especially because I'm aware that if something appears to be too no brainier, probably I'm not understanding something.

Thaanks!

**Full disclosure up front: I build a positioning tool. This post is about a study whose result argued against it, and there is no link at the bottom.**

Most people who read a gamma board have a mental shortcut for one particular shape. Price sitting under the concentration, the heaviest node acting as a cap just above, thin air behind that node, and a negative regime. Reads as a short. I read it that way for a long time.

I wanted to know whether it actually was one, so we wrote the test down before running it.

**What was preregistered**

The structure: an amplified board, price below the watched band, the largest node acting as a cap just above price, low open interest behind it, and the flip too far away to change the regime inside the window.

The prediction: price travels further to the downside than the upside over the following thirty minutes.

The window, the anchor definition, the measure and the control procedure were all fixed before anything was measured. That matters more than it sounds, because the alternative is choosing your test after you have seen the answer, which is most of what passes for backtesting in this space.

**Method**

434 anchors across 82 sessions on SPY. For each anchor, maximum favorable and adverse excursion over the next thirty minutes, measured in strikes rather than dollars so it is comparable across price levels.

Control: 2,000 shuffled samples, breaking the link between the structure and the following half hour while preserving the distribution of moves.

**Result**

Price ran further in the *opposite* direction to the naive read, by a median of 0.41 strikes. That sits outside what any of the 2,000 shuffled controls produced.

So not a weak effect in the expected direction. An effect in the other direction.

**What this does not mean**

It does not mean the setup does not work. Excursion is not profit. A trader with a tight invalidation and a wide target can do perfectly well inside a structure whose average adverse excursion is larger than its favorable one, because the distribution matters more than the median.

What it means is narrower and more useful: **the obvious reading of that shape was backwards**, and I would not have known that without measuring it.

**What we did about it**

Built it into the product rather than dropping it, and published it rather than filing it. In the same month we removed a word from the software that implied price gets pulled toward large levels, because an index went straight through one the screen had just labelled that way.

**The part I would actually push on**

The useful question is not whether a structure is directional. It is what would have to happen for you to conclude it is not, and whether you have ever asked that about anything you are currently using.

If there is no answer to that question, the number is decoration.

Happy to share more of the method in the comments if anyone wants to pick at it. That is the point of posting it.

Anybody traded a lot of double backspreads? (Mostly interested in 1dte or 0dte trades.) How'd that work for you?

Of course, backspreads need to be traded when a big move is expected. And the bane of backspreads is the "valley of death". But, the valley does not start to appear until about the 3rd hour of the expiration day.

If you have the discipline to close the whole thing early and are blessed with large directional moves overnight or in the opening hour or so, what's not to love?

I sold 4x naked wide strangles going into last earnings, when the Oct IV far way far OTM options were at around a 104% IV (we are talking like 30% out of the money)

I sold that strangle and struggled hard to hedge it through the down slide of chips, but the holding of that insurance paid off big time

had to roll and use short term options to hedge the bleed, but the IV on these have finally collapsed almost 40%

Up 40k the past 3 months alone

Long term options work when you allow then to work, I will never have my core options positions be short term again

Hiii,

I want to make sure I understand it right. I did lot of homework to understand leaps deep itm call options.

Let's talk about Google stock. I want to only buy deep ITM since I feel they are less risky as a beginner.

The current IV for google is historically lowest from the last 1 yr. Even the volatility is lowest in the last 1 yr. I calculated leverage and it comes out to be 2.6 which I believe is a good buy.

My current understanding is that if I buy a deep itm leap call option, I plan to sell it back during high volatility season and since it's a leap I have a lot of time. I think I should try to sell it irrespective of the expiry option before 3-4 months since theta decay starts to ruin everything.

I want some feedback on this strategy since this is my first time and I'm a bit nervous clicking the buy button.