Trading Strategy With A High Win Rate - Here's The Strategy I Like Most!

Coffee With Markus | Episode 102

Intro: 00:00
What's Happening In The Markets: 1:33
A Trading Strategy With A High Win Rate: 4:39
Deep Dive Q&A: 28:07
Q: Why do some so call "Pros" suggest not to trade options during earnings season?: 31:42
Q: When you sell calls as part of "The Wheel" strategy, what is your criteria pertaining to the target call premium and strike price?: 35:25
C: The expiry is based on all days, not just trading days: 38:02

Today the markets were all over the place seeming to react to every word said during discussions over another stimulus package.

GS made a statement that they said they thought it would be unlikely there would be a stimulus deal before the election. Then you had Pelosi and Meadows say they were making good progress and the markets jumped up a bit again. This mixed in with the fact that once again it's earnings season, means really one thing: volatility

3 months ago, I started with $50,000 in a tastyworks margin account. To this point, I've realized: $11,329 or 22.7% in profits. Now, IF I can keep this up that would be 22.7%* 4 = 90.8% per year.

Are these SRC profits? YES! Let's take a quick look at the strategy:

"The Wheel" - Overview:
1) Pick a stock that's going sideways or slightly moving up
2) Sell a Put Option, i.e. you have to buy the stock at the strike price
3) Collect premium and buy it back when we see 90% of the profits
4) If we get assigned, i.e. we have to buy the stock, we will sell Calls
- We have to sell the stock at the strike price
5) Collect premium on the call and we buy it back when we see 90% of the profits

So with that, we can answer the three key questions a good trading strategy answers:
1) What stocks or options to trade
2) When to enter
3) When to exit

If you want a more in-depth explanation of "The Wheel" strategy, here is a link to the playlist: https://www.youtube.com/playlist?list=PLBa3sAx-Io2nosgosERUhIZwzvIgD-3Vq

Now let's look at some recent trade examples. First, I want to look at a trade in DOW. At the time of this trade, I've been in for two days. What I'm looking at is that DOW will stay above $45.50 Put for two more days. And looking at the chart you'll se it would have to fall a long way before it gets there. For this trade, I'll collect $44 per Option and I sold 4 of them which would equal: $176. This might not seem like a lot, but it was high probability and only took a couple of days.

Here's another example of a trade I still have on in KSS, where I sold the $18.50 Put for $15 per Option and I sold 13 of them giving me: $195 in 7 days.

Another trade example is in IBM where I sold 2 of the 115 Puts for $43 per option giving me: $86 in 3 days

Now if IBM were to dip below 115 before expiration, could I get assigned? Of course, but that's part of this strategy. The 3 times I have been assigned thus far, turned out to be the trades where I made the most money.

So now, lets discuss where things can go wrong with this strategy:

How Can You Mess This Up?
1) Picking The Wrong Stock
2) Picking The Wrong Strike Price
3) Picking The Wrong Expiration
4) Not Getting Enough Premium Per Day (PPD)
5) Not Knowing What To Do When You Get Assigned

I hope this helps! P.S. Right now, I'm running a special on my "Power Income Alerts." You can try it out for 30 days for just $1: https://bit.ly/31zXTJX

#tradingstrategywithahighwinrate #highwinratetradingstrategy #besthighwinratetradingstrategy
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Видео Trading Strategy With A High Win Rate - Here's The Strategy I Like Most! канала Markus Heitkoetter