Option experts,
I was having ETF investments in taxable and Roth IRA accounts. Recently I’ve heard about wheel option strategy to earn passive income with very less risk.
I’m planning to start with Roth IRA first and have around $125,000.
Looking for some experts suggestions on stock pick and easy to follow strategy. I understand that I should be open to hold stock if CSP is assigned. Would anyone share good quality stocks considering my investment amount for wheel strategy or pure option trading. My account with fidelity in case that makes any difference. Thank you in advance.
Posted by rpanony
4 Comments
I guess there might be some useful info in r/Optionswheel community. I remember seeing a pinned topic there about stocks to wheel.
I started wheeling with KO. You won’t make a lot because the stock is quite stable, but it’s a good stock to learn on.
It is more than just what stock, you also need to ask is now a good time to wheel that stock.
You need to stack as many things to your advantage as possible when you are selling to open the put. Is the stock overbought or oversold? Is there a support level above your strike? Is there enough open interest on the option you are selling? Is the Option Delta acceptable?
I use a screener to filter out the thousands of crappy trades and then decide which ones to actually trade.
My opinion? Don’t do it in the Roth, leave it alone (Don’t know what ETFs you have in there). Why? You just might blow up the account. Might.
If you do it/try wheel in the brokerage, losses can be used to offset your other gains, or lower your tax liability. Roth is completely tax free, so why risk that account.
Just my 5 cents (Inflation, you know…) As far as stonks go, sell CSP in SOUN, like maybe $10 or $11 strike price, get your feet wet before diving off the cliff in Acapulco.
As usual, not financial advice. Ask your doctor before taking Options, side affects may include sleepless nights, heartburn, do not take Options if your woody lasts longer than 10 hours; etc…. Yadda-yadda-yadda