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2017 was fine. Usually 15%-20% of total capital. My puts are always cash-secured, meaning I front the total amount that could be required if the put is assigned. So I'll never get a margin call or have my buying power adjusted. I believe the CBOE performance is a purely mechanical strategy...

If the put still has time value, I'll keep it until it erodes. Then I would roll it down as far as needed to pick up more time value. This scenario would likely result in a loss. But you still have options, you could take assignment if you liked the stock and write calls. My strategy doesn't...

I mentioned that I had sold Dec 7 WLL 31 puts on Tuesday as an example of what might happen when a trade moves against me. I thought it might be useful to update throughout in real time. When I opened, the stock was at 32.01 and I received a premium of 67 cents. By the end of day, the stock had...

ajensen, Thank you for these ideas. I'm embarrassed to say I wasn't familiar with the Sharpe ratio. It gives us a way to evaluate our returns based on the risk we are taking, a valuable tool indeed. Using the risk-free rate of .0234 (yesterday's T-bill rate) my ratio comes out at 1.09. That's...

It's not the same position. If I'm at 31 now and roll to 30, that's a different position.

maximumpossiblesuffering gets it: "One of the keys, which you are adhering to is avoiding the use of leverage. It is hard to blow up an cash only account." I also agree with your other points. Those who compare my approach to James Coudrier of OptionSellers.com or Karen the SuperTrader are...

Smallfil, I doff my hat to you if you are able to buy options and make money. I could never do that and it would make me a nervous wreck. I sold WLL 31 puts today when the stock was at 32.01 for a premium of 67 cents. The stock is now at 30.82. As things stand now, I could go down to a 30...

I appreciate everyone's response. For my purposes, I don't even think in terms of bull or bear. Stock prices fluctuate. They go up and down. I've been on plenty that went down substantially. If the more general trend is down, it does require more management than if they all just expire.

Does it matter to a put seller if we're in a bear market? Won't premiums go up? My business model doesn't depend on asset appreciation. I hope these aren't my last words. I'm not a very good salesman.

I've traded WLL since the October drop, from 56 to 28. I have traded a lot of stocks that have lost 20% to 45% of their value. I opened a Micron position at 60. It's now at 37. The lesson to me is that if my strategy is viable under these conditions, I have little to fear.

I would like to add that there is a widespread misconception that selling premium entails some kind of wild risk that only a fool would undertake. I have made the case that selling puts is less risky than an equivalent stock position - it's just simple math really. The important thing is that I...

Well, the logic is that I'm making money. As I said, I don't use leverage. I typically have 5 or 6 positions a week, so even if Twitter or Roku go to zero, I won't be wiped out. The significant idea in my post is that you can roll down and out for a credit for most positions that go against...

I've been selling premium for about 3 years, and I have a data sample of a couple of thousand trades. My returns so far are between 25% and 35%, but I think I can improve going forward, since I have learned a few lessons and abandoned a few strategies that were not profitable. The conventional...