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Thanks for the replies everyone....looks like my trade that I've been doing will be profitable 90% of the time, but one large news event will wipe out my profits and more. I have a lot to learn.

Don, what do you mean find the stock that's "paired off"?

The big risk is the "black swan" event either up or down. But, for those warning against this...do you also never hold an equity long overnight without a protective option? What if the stock opens 50% lower? I'm not saying my plan is without risk...I just felt that the risk was lower since...

Yes if it enters and exits my "range" often, I can rack up trading losses, but I get a "buffer" for my trading losses by the premium I collect from selling the options. Okay so the overnight gap up risk can be large I'm seeing. Therein lies the risk.

Well the one I just opened is with CLF. I sold calls at $75, and puts at $65. Stock is at $70. So, pretty far out of the money.

I do see your point, and it's a good one. What if I were to only use index ETFs? I've been doing strategy with CLF, and some large cap blue chips trying to minimize the overnight gap risk on news.

I'm new to trading options, and I've been doing a strategy for the past few months that's given me some success. I don't see much risk, and it seem like it's "too easy", which is why I think I'm overlooking something. I sell a put below current stock price, and sell a call above current...