11-04-2021, 03:48 PM
(11-04-2021, 02:43 PM)fenders53 Wrote: The XOM trade was fine IMO. Selling calls on XOM worked for years. We never know. I sold XOM puts the past few weeks on dips. Over time the less volatile stocks work out. It's a percentage of successful trades game.
The QCOM trade was awful. Not because it didn't work out, but the risk reward was never their. For about 1/3% premium you forfeited the right to any real upside on the earnings announcement. Had it fallen 10% instead you were insulated from only 1/3%. Still bad option sell. Something further out in duration and strike might have been better. Hard to protect yourself from a 10%+ move.
Don't give up but maybe stick with some lower potential stocks that won't break your heart until you get some repetitions in. This gets easier with time.
Great points. I have also been selling puts after my shares got called away (all of them expired so I kept the $$). Though with the trend, I wonder if it is actually better to hold the stock and collect dividend. My investment philosophy will still be buy & hold quality stocks while collecting dividend.
I plan to hold QCOM long term and with their peg ratio they still have a ton of room to grow. I now even consider buying back the call on QCOM. At least I can keep the shares and do cap loss harvesting. It’s painful!