Quote from Wayne Gibbous:
You say that you are selling premium, but NOT selling spreads?
Selling puts maybe? Short with dispersion trades? ??? If it has a long and a short in it, or the underlying, it's a spread imho.
Maybe if you detailed your methods a little, the more experienced traders here could point you down the right path - at least based on their experience, anyway.
No, nobody will "steal" your method. Whatever it is, i will guarantee it has been done before.
I do urge caution, tho. How would your method do if the Naz 100 stocks were down, week after week, for years? And with ferocious rallies in between?
The last few years have been cake for prem sellers. That will end and take many many op sellers that got too comfortable with risk, to Blowout Land.
Good luck in your efforts. 
<img src="http://chart.finance.yahoo.com/c/5y/q/qqqq"/>
Wayne, thanks for your posting and I appreciate your interest in my trading methodology. Here is a brief synopsis: I trade only the index because I know it can't go to zero except in the case of catastrophic failure (in which I will have bigger problems to worry about). Therefore, I do mind owning it and holding it if need be for the long-term. Of the indexes I trade QQQQ because it has a volatility profile, spread and high liquidity/volume that I require.
I wait until the market becomes "destabilized" in accordance with proprietary indicators and in an occurrence with a frequency less than a certain %. I then sell puts (once again proprietarily determined) with the capital in reserve to buy the underlying should I be assigned. I am prepared to buy them and let the market tell me what to do. If the option expires worthless, I repeat the process when the market is once again destabilized. If assigned, I wait for a destabilization and sell calls. In both cases, regression to the mean almost always ensures that the premiums will fall despite the overall movement of the market, giving me the opportunity to buy them back.
In a bear market, I will accumulate through scaled assignments and then resell into the demand. Because no bull market goes straight up and no bear market goes straight down, opportunities of destabilization occur frequently enough to provide opportunities to sell calls. (choppy, volatile markets are great for this type of trading). Between dollar cost averaging, collected premiums and dividends paid while holding (though they are so small as to be negligible), my cost basis is constantly falling in a bear market.
I practice risk management by limiting my margin to what a typical brokerage account permits for stocks and I also divide my trading capital into a certain number of lots so that I am fully positioned to buy on the way down.
The greatest risk to my methodology is that I will simply expend all of my capital on the way down (100% in the market) and will have to wait until the next destabilization. However, they occur frequently enough to keep income coming in.
Wayne, in regards to your question: "How would your method do if the Naz 100 stocks were down, week after week, for years? And with ferocious rallies in between?" I would just say that destabilization is triggered by these types of events and they must be significant. That is why I make so few trades. So if the market drop 100 points one week, it would probably not be significant. However, if the market dropped substantially in a day that might be a trigger. So my entries are limited and infact, rather difficult to put on. This means it takes me a long time to be 100% in the market.
I hope that provides some insight and thanks again to all who have posted and provided such excellent advise!
Daryl
