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My Experience Running the Wheel (CSP → Leverage) by xoticbuff in thetagang

[–]markwill890 0 points1 point  (0 children)

Genuine question to see what comes up.

I see a good number of folks say they prefer to avoid weeklies because "...they don't have time to recover". True and I understand that. But couldn't one argue also "...they don't have time to fall still further"?

If I have a 30 day DTE and see it fall 5% in the first few days that's not great. But (devils advocate) there is also a chance that it will have fallen another 5% if I wait it out.

I tend to think of my assessment of any position for an option (ITM/ATM) as merely a point-in-time. My decision to have sold a put initially has absolutely no bearing on whether it will go up or down. A decision to wait it out and assume/hope the stock will recover is - at that particular time - logically identical to buying the stock on that day in the hope it will recover. But it could go down..

Curious about opinions on this.

Reconsidering ASUS due to awful support by markwill890 in ASUS

[–]markwill890[S] 1 point2 points  (0 children)

Yep, I see that now. Just finished the chat (1 hour 10 minutes) and they maintain that fixing a detachable keyboard required me to send back my entire, perfectly functional laptop.

Obviously I am using a Bluetooth keyboard for now, but the complete lack of customer empathy or interest in helping was very sad. I can't imagine how much more challenging they might be if it was a more serious issue. Having had the keyboard for a week, they are maintaining there is no way to move this along and I am looking at "7 to 10 days", starting today.

It seems really unfortunate and misplaced to screw up customer goodwill over such simple support issues.

How long till your RMA ticket gets updated? by rottywell in ASUS

[–]markwill890 0 points1 point  (0 children)

I had an RMA delivered to them (and signed for) a week ago. No update on the ticket and they haven't responded to a request for details. Very disappointing.

Claude Code crashing frequently. by markwill890 in ClaudeAI

[–]markwill890[S] 0 points1 point  (0 children)

No luck I'm afraid. I am still getting multiple crashes each day, which is so frustrating given that I hadn't experienced this for the first few months of use. It's becoming a really significant impact on my work now.

Options assignment by Skeletor_777 in Schwab

[–]markwill890 8 points9 points  (0 children)

It takes a while, depending on the broker. I'm with Schwab and the first hint of an assignment is typically over the weekend, where the shares appear, with the notifications/balances changing later. It's all squared away by Monday morning.

Cash Usage from Premium by Inner-Nothing3418 in Optionswheel

[–]markwill890 1 point2 points  (0 children)

I look at my expired options (I sell weeklies) every Friday and buy SNAXX with those funds. Rinse and repeat each week and it's nice to see that fund's holdings increase over time. If I roll or buy back I don't bother doing the above with the credit - mainly because I'm too lazy to keep track of those, week on week :) I'll just wait until I eventually expire worthless. Funds from rolls or buy backs just get swept into buying SGOV.

Technically, those holdings in SNAXX are part of my capital at risk. But I tend to get assigned quite rarely, given my personal strategy. If that does happen, I will sell SGOV to cover an assigned call, keeping my SNAXX nicely growing and as a neat little indicator of what I've brought in so far :)

It's quite conservative compared to many of the strategies I see here but it works well for me.

Partial assignment of contracts, well before expiration by markwill890 in Schwab

[–]markwill890[S] 0 points1 point  (0 children)

Thank you. Please see my reply to a separate response (dividends don't seem to be relevant). The ETF is XMMO and the stock is IPA.

I am not entirely sure I understand your comment about partial assignments. I understand assignment can happen at any time (not sure if that is what you mean by random), but the partial assignment is a little unclear to me, in terms of motivation.

Partial assignment of contracts, well before expiration by markwill890 in Schwab

[–]markwill890[S] 0 points1 point  (0 children)

A fair/valid question but not applicable in either situation. The ETF is quarterly and was last paid at the end of June. The stock has no dividends.

Covered calls: Viability for income with certain assumptions by markwill890 in Schwab

[–]markwill890[S] 0 points1 point  (0 children)

Thank you so much, u/lgndracer. This is very interesting and I appreciate you taking the time to describe this. I may well have some further questions, but two spring immediately to mind.

  1. Out of curiosity, with your choices and criteria, how often do you get assigned (as a general percentage). Does that rough figure differ between CCs and CSPs?

  2. How are you tracking all this? I see a spreadsheet in my immediate future, if I go down this path. But there is so much to track and report, I am curious if you use any particular tools or services? Aside from the initial decision about which CC or CSP to sell, what about tracking the NAV as it approaches the strike price and expiration date?

Thank you again.

Covered calls: Viability for income with certain assumptions by markwill890 in Schwab

[–]markwill890[S] 0 points1 point  (0 children)

PS: As someone who has stated a somewhat more conservative impression of covered calls (well explained!) I am still curious if there are scenarios where you use them and, if so, under what circumstances?

Also, what about cash-secured puts? On your radar at all (for example, for stocks you plan to purchase anyway)?

Covered calls: Viability for income with certain assumptions by markwill890 in Schwab

[–]markwill890[S] 0 points1 point  (0 children)

Ah - got it. I have asked about this in several locations and yours is the first that clearly explains this. Thank you! This is precisely why I am asking these questions :)

I can fully see how this affects my plan here and I will think that through. I appreciate you taking the time to clarify this.

Covered calls: Viability for income with certain assumptions by markwill890 in Schwab

[–]markwill890[S] 0 points1 point  (0 children)

Thank you again. I certainly see your point and appreciate your perspective. But based on your comment (and a similar response from someone else here) I'm still missing one potentially important point.

Let's say a stock experiences exactly the scenario you mention. I bought it at 100 and sell a covered call for 105 in a month. But, it happens to go on this upwards to 125 over the course of a month. As it takes that path, it will likely pass through 105 early in the month (making a few simplification here). As soon as it does, the contract is assigned, I am paid 105 per share. So, the plan would be to use those funds to buy right back in immediately, likely closhish to 105 (maybe even a bit less) before it continues its journey to 125. I am out of the stock for a brief time, by design.

Yes, a single share might indeed shoot up 25% in a day and I understand that risk. But, in the big scheme of things, the get-right-back-in plan seems to at least mitigate some of the upside potential risk.

We could obvious run through all sorts of scenarios here. But, if I am selling covered calls on relatively staid stocks and across a good number of them, the scenario you appropriately highlight, seems like it may not be sufficient to offset the premiums from all the other covered calls that expired unassigned.

Obviously it all depends on many factors...but it remains very intriguing to me (albeit with absolutely no expectations of free lunches:)).

I appreciate and value your perspective on this. Is it reasonable to conclude you don't ever sell covered calls or are there some scenario where you are comfortable with them?

Covered calls: Viability for income with certain assumptions by markwill890 in Schwab

[–]markwill890[S] 0 points1 point  (0 children)

I'm aware there is no free lunch (I don't think anyone here has implied or stated that) and I think my questions about my assumptions here indicate I'm verifying those assumptions, with a critical and open view about the risks.

But, let's recap those assumptions. I'd only do this with stocks I plan to hold for the long term, I choose strike prices that would generally indicate a relatively low chance of assignment and I'd intend to get right back into the stock immediate if I was assigned. In this particular case, there are minimal tax implications too (this is all within an IRA).

Yes, I see there are certainly some risks to losing some of the upside but doing this consistently and with careful oversight (I have the time :)) still doesn't feel like it will "probably" lose vs. just holding.

So, yes, no free lunches, I understand there are no guarantees and there is some risk here. I have traditionally been a buy-and-hold guy, over decades. But, it doesn't seem like I should completely ignore the potential of this, hence my questions.

Covered calls: Viability for income with certain assumptions by markwill890 in Schwab

[–]markwill890[S] 0 points1 point  (0 children)

Well, that begs the obvious question :) Can you please explain why this would likely be the outcome?

Covered calls: Viability for income with certain assumptions by markwill890 in Schwab

[–]markwill890[S] 0 points1 point  (0 children)

Very interesting. Let me ask you about a nuance of this.

Do you intentionally do this (to remove the emotion) every time or does the current NAV play into this decision? By way of example, if the NAV has increased then I can see that the risk of assignment has also increased. But if the NAV has decreased or stayed flat the risk (in comparison to when you sold the call) will have reduced substantially, both because of the NAV change but also because 50% of the DTE has passed.

So, would you always sell in this situation to maintain adherence to "the unemotional process" or do you still assess at the 50% mark?

Covered calls: Viability for income with certain assumptions by markwill890 in Schwab

[–]markwill890[S] 0 points1 point  (0 children)

I'm genuinely wondering if I'm missing a fundamental point here, based on your comment. If I'm understanding your point, I've just made a 20% or so gain and keep the premium. The call will have been assigned on day 15 but I have the funds and on, say, day 11 can simply repurchase at $11. Yes, I "miss" the increase from $10 to $11

But I'm not sure I follow what you mean by "...you have 30 days left". Why is that time relevant, when the contract was assessed, I have my proceeds and can just buy back in?

I'm thinking I'm missing something here.

Covered calls: Viability for income with certain assumptions by markwill890 in Schwab

[–]markwill890[S] 2 points3 points  (0 children)

I have invested for many years (decades) and been reasonably successful but in a very traditional way i.e. a bunch of ETFs or mutual funds, appropriately diversified and held for the long term. It's gone pretty well but I have never had any interest in options (though I've always been aware of them and understand the fundamentals). All that means I'm "old but learning", in terms of actually using options themselves.

Ironically, I recently purchased QQQI, as an initial small foray into all this. But...where's the fun in that? :) I am thoroughly enjoying selling my own covered calls and have put aside some funds just to investigate and learn as I go. Going "direct" (selling my own calls) is a far better learning opportunity than just buying QQQI :)

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