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It's profitable until it's not. On a more serious note, as others have pointed out, option sellers can be profitable for a long time and then comes that one big move against you that wipes out months, if not years, of profits. The key is very strict risk management and proper position...

You can buy a deep OTM call to protect the short call and thus create a credit spread. So as long as you can trade credit spreads in the account you are OK. Alternatively, you can just buy deep ITM puts with a couple of years to expiration (LEAPS).

The OP is asking about an IRA account, which has trading restrictions, hence the question for the substitute that can be held in an IRA account.

I'm more into real life trading value, but if you are more into theoretical value then that's fine by me. On a side note, this thread doesn't belong in the options forum, as it has nothing to do with options.

A closing price is not a real price since you cannot trade at this price. Your portfolio returns $800 more than buy&hold over a 60-year period. This is not an outperformance when you take into account the costs associated with monthly rebalancing. There have been a lot of academic work that...

There are at least two problems with your backtesting. 1. You don't take into account commissions and slippage. $800 difference between the two portfolios in the first example wouldn't even be enough to cover the commissions. 2. In reality you can't trade at the closing price, so the actual...

On a Thinkorswim platform you have a thinkback function as well as new On Demand function both of which allow you to do what you are looking for.

CBOE has a simulator, also some of the brokerages such as Thinkorswim and Optionsxpress among others have simulators.

Only market makers have the privilege of making a two-sided market. $8 for 1 contract is very expensive, and yes, there are many brokers that offer a lower rate.

Next time you may wanna check the contract specs before asking such a simple question. Last Trading Day: Quarterly options are p.m.-settled contracts. The last trading day, therefore, is the last business day of each calendar quarter.

I guess you are new to this and weren't around the last couple of years when the Dow dropped over 50% from the high. So what are you going to do when your balance drops to 12,500? Still think your strategy is good?

In general it is thought to be the same as with stocks - trade on the ask means a buy, trade on the bid means a sell. However, in reality, there is no way of knowing for sure. There are just too many variables. Sure, if the option trades at the ask then it looks like a buy, but maybe the...

Barron's survey

If SPY drops to 80 then you will get assigned on the short and the long will be automatically exercised as it is more than 0.01 ITM. If SPY is at 97 then you would be assigned on the short put and come Monday you would find that you are long 100 shares, which you bought at 100. Assuming you...

The SPX settlement value has very little to do with the Thu close or where the futures are. As it has been mentioned, the settlement value is calculated using the opening print for each of the component stocks, which means that the value can be dramatically different from the regular SPX values...

The settlement values for SPX and RUT are calculated based on the opening print of each of the component stocks on expiration Friday. There is no single point in time, because the opening trades in various stocks take place at different times, obviously the liquid ones are not a problem, but the...

As a side note, bloomie costs about $1,800 per month excluding real-time data.

Bloomberg professional.

Cross underlying margining only matters if you use portfolio margining or SPAN. For portfolio margining you can use this one. As for SPAN, there is no free calculator.

Or the OP can just close out the put and achieve the same thing with less cost.