Trying to find the right stock.

joarbana

joarbana

Pretty new with trading options, took some online free courses to get a good grip of the mechanics of it all and got my feet wet with some option trading over the past couple months. I've been running myself around in circles trading these things though and I feel as though just holding steady equity and selling calls for maximized returns would be the most fitting for me.

Question is though, what is a good stock that any of you may know of that would be <10.00 that would have decent option volume and a pretty low beta. Ive scoured through screeners with not a whole lot of luck. Only investing with a couple thousand and I'm really looking to try and yank in some monthly premiums writing call options. Set and forget kind of stuff.

Had a little period where I thought I could outthink the whole idea of options and that proved to be pretty wrong, instead of going for the hail mary pass to the end zone every play Im looking just to make small consistent gains month to month and be smart about it.

all the help would be appreciated.
 
joarbana said:
Pretty new with trading options, took some online free courses to get a good grip of the mechanics of it all and got my feet wet with some option trading over the past couple months. I've been running myself around in circles trading these things though and I feel as though just holding steady equity and selling calls for maximized returns would be the most fitting for me.

Question is though, what is a good stock that any of you may know of that would be <10.00 that would have decent option volume and a pretty low beta. Ive scoured through screeners with not a whole lot of luck. Only investing with a couple thousand and I'm really looking to try and yank in some monthly premiums writing call options. Set and forget kind of stuff.

Had a little period where I thought I could outthink the whole idea of options and that proved to be pretty wrong, instead of going for the hail mary pass to the end zone every play Im looking just to make small consistent gains month to month and be smart about it.

all the help would be appreciated.
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Do you delta hedge your calls?
 
joarbana said:
Question is though, what is a good stock that any of you may know of that would be <10.00 that would have decent option volume and a pretty low beta. Ive scoured through screeners with not a whole lot of luck. Only investing with a couple thousand and I'm really looking to try and yank in some monthly premiums writing call options. Set and forget kind of stuff.
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Options in itself is not an edge. Under 10 is hard to find. How about USO? Pretty liquid and the volatility will lead to relatively high premium. 6 months ago, I would have recommended CHK, but not so much anymore. JNUG also has options and it's very volatile (3x etf). I like selling puts on it around here as gold has fallen a bit, but I think it will have long-term support. Still though, I'm not nuts about that stuff. You're probably best off saving up more money to write calls on more expensive stocks / etfs. Hard to find quality under $10.
 
joarbana said:
Question is though, what is a good stock that any of you may know of that would be <10.00 that would have decent option volume and a pretty low beta. Ive scoured through screeners with not a whole lot of luck. Only investing with a couple thousand and I'm really looking to try and yank in some monthly premiums writing call options. Set and forget kind of stuff.
More...
Welcome, I have a question and a comment.

Question: Why are you looking for stocks that is <$10, and with low beta? Are you trying to short options with only a few $K back up, and thought you could go further with low price stocks? If so, it is a wrong way to look at options.

Comment: If you are thinking about selling options to collect premium, it is a risky way to make a little money, even when the options are covered. Judging from your post, with limited resource you are probably going naked and a naked short option is very high risk, not for new traders.

Good luck.
 
Yes, it's true that having only a small amount of extra money it's hard to immediately begin trading, and even with the right skills, knowledge and experience. One should start with a few thousand, no less.
 
joarbana.
premium selling is far from a set and forget strategy specially with VIX this low. My worse week in the options pits decades ago was standing next to a lady about to go on her honeymoon. She sold tons of juice thinking she could buy it back after getting back from the islands . Sugar broke multi year highs that honeymoon week. After about 2 days of trying to buy back some juice.. clearing firm gave her the boot...I never saw her again.
 
If you want a set and forget, buy OTM calendars on names you think might go higher or lower. WATCH your vega! Might hit 50% win IF you have some good charting ability. On the ones you lose you lose the debit, on the ones you make you might make 2-3x debit.
 
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