re: Covered Calls, Wheeling, Theta Gang Thread.

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That would be about 6k additional, right? I guess the only problem would be if the stock price falls lower than what you paid for it initially? Is that the only way to lose?

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Most people sell covered calls against positions that they are comfortable with keeping long term. They do it for income.
But look at it this way…
Subtract the premium received from your cost basis for buying the shares.
So you have wiggle room on the downside too, if the stock drops.

Also, if the stock drops, your options will expire worthless, which is good in this case (you keep the entire premium), and you can then just lower your next round of calls against your position while collecting more premium.

It’s an entire strategy in itself and some make consistent 30-50% annually doing exclusively this.

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? Is that the only way to lose?

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I’ve done covered calls.

The process can sell you out of a position before it really rockets.

It can also keep you in a position that goes well below strike price.

I do it, but only at strikes that I’m will to exit the stock.

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So you would get the premium and you would also get 20 per share from 80 to 100 if the options are exercised?

That would be about 6k additional, right? I guess the only problem would be if the stock price falls lower than what you paid for it initially? Is that the only way to lose?

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Yes, I'd get the $20 / share x 300 plus the juice (premium).
I don't ever set a strike price lower than I originally paid.

*I am doing all of this in a Roth 401K account, so taxes are not a concern of mine, as they will be if you do this in a trading acct or a trad. 401k (in the long run).

I normally pick strike prices that are <.3 delta & have at least a 10% OTM.

These particular options are good / but are still risky as even though they are 20% OTM, the price climb could blow these strike prices away as the stock is expected to >3x this year, that would mean that a 25 % increase a month could happen. If that happens, I'd make the afore mentioned 6K + , but lose out on further increases unless I jumped right back in at a higher base cost.

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Best looking cover calls is PLTR ($79.9): Strike 100 on 2/21/25; delta .32, premium 4.10 for 3 contracts is $1230, 48 days out with over 20%OTM.

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Are you factoring in earnings on Feb 3? Most likely will run into earnings and depending on numbers could make a large gap up. Unless of course the whole market takes a downturn.

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ike I said, I could see PLTR going to over $200 by EOY so, a 25% increase / month on avg would not be out of question.

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If you are this bullish on PLTR, you should not be selling covered calls on that position. If PLTR really does hit 200 by EOY, you will come out far ahead by being long shares instead of fooling around with covered calls.

I personally am bullish on PLTR, to what extent, I'm not sure yet.

I didn't place those covered calls this am for PLTR.

I did sell NVDA $173 for 2/21 and AMAT $210 for 2/21

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I also bought the AMD 105 Call for 12/19/25, I think this could pay big as well.

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That's an expensive one...

Lost my HOOD stock on $47 CCs
Guess I’ll put in a CSP for $47 and collect a bit more.

Which strike?

I was thinking of going with 2/21 expiration