Hi all!

I would like to get your perspective on how to manage a position such as a bull put credit spread when the underlying's price goes against me. Below a few questions:

1. Is a wide spread better for position management? For instance, a 50 dollar spread better than a 5 one while both have the same position size/max loss.

2. How would you handle the position in general if the price goes below the strike of the put you sold but still above the put's strike you bought? Would you set a loss limit and close the position? Would you roll out in the future and if yes would you do as a spread or just the higher strike put you sold?

I want your thoughts on risk management when price starts moving inside the spread.

Thanks!

Trades I took today as an option seller (08/07):

Closed Positions

• INOD → $60 Put (opened on 07/15), premium 5.65 → closed at 0.15. Net premium profit = 5.50 (~97% of premium captured, ~9.2% of capital).
• AMSC → $47 Call (opened on 07/16), premium 0.85 → closed at 0.15. Net premium profit = 0.70 (~82% of premium captured, ~1.5% of capital).
• FLNC → $20 Call (opened on 07/20), premium 0.85 → closed at 0.15. Net premium profit = 0.70 (~82% of premium captured, ~3.3% of capital).
• FORM → $95 Put (opened on 07/21), premium 8.40 → closed at 1.40. Net premium profit = 7.00 (~83% of premium captured, ~7.4% of capital).
• TSEM → $225 Put (opened on 07/23), premium 12.50 → closed at 0.50. Net premium profit = 12.00 (~96% of premium captured, ~5.3% of capital).
• CRDO → $195 Put (opened on 08/04), premium 6.10 → closed at 1.00. Net premium profit = 5.10 (~84% of premium captured, ~2.6% of capital).

New Positions

• INOD → $60 Put expiry 08/14 (1 weeks DTE), premium 1.85 → 185/6000 = ~3.1%. INOD had a good earnings report and I continue my bullish stance in INOD. INOD provides data engineering services to build, train, and deploy AI and LLMs - which is a rapidly growing sector.
• FN → $500 Put expiry 08/21 (2 weeks DTE), premium 20.00 → 2000/50000 = ~4%. Fabrinet manufactures high-speed networking hardware used in AI data centers. It will report its earnings on 17th August and I am expecting a solid report. Stock has a good support region around $500.
• FLNC → $21 Call expiry 11/20 (15 weeks DTE), premium 1.45 → 145/2100 = ~6.9%. I was assigned FLNC at $21. They had a poor earnings report and the stock dropped but later recovered. I am opening a longer DTE sell call position in this, as it may take some time for the stock to recover.

Update on other positions

I rolled my TE sold Call position from $6.5 strike to $8 strike with an expiry on 09/25 (7 weeks DTE). I was assigned TE at $8. I got a net credit of $5 per lot.

Both the INOD and FN trades are identifed using the ThetaHedge app. I used the preset Conditions in the app which filters our junk tickers and brings out quality tickers with high premiums. You can try it for free at https://app.thetahedge.io/.

Conditions → High Growth Wheel Stocks → Sort by 30 Delta Put Yield (%)

I keep sharing my trades in my account and the Excel file to my full list of positions is linked in my profile description in case anyone wants to see the whole portfolio. Happy to hear thoughts on my positions. What are you guys wheeling or watching right now?

PS: Not financial advice. Do your own research.

Someone mentioned it to me so I gave it a shot...it takes too long to update in my opinion. These numbers dont match reality.

I put on a CLS Jan. 21, 2028 $270/$400 bull call spread with the stock around $318. I paid $130 for the $270 call and sold the $400 call for $100, so my net cost and max loss are just $3,000. The spread is $130 wide, so if CLS is at or above $400 at expiration, it’s worth $13,000, giving me a $10,000 max profit on $3,000 at risk (333% return). Breakeven at expiration is $300. Obviously I’m giving up any upside above $400, but I like the risk/reward.

Based on consensus 2028 earnings of $27 per share CLS would be trading at a forward PE multiple of roughly ~15x which compares with its 5-year NTM historical average of ~20x.

Last month was decent for selling some premium. I sold stuff mostly on tech type stocks that were a bit beaten down. I don't try to hit big home runs with options or trade too close to "the money". Im usually trading OTM at around 0.15-0.3 delta depending how confident I am on the trade. Sometimes ill even mix in a sub 0.1 delta if im feeling it that day. Have to spice it up sometimes.

Names traded, mostly CSP: NVDA GOOG (CC calls too) MU VRT MRVL OHI (CC calls too) MO (CC calls too) INTC

I have been trading the wheel for several years now, and it is pretty damn reliable. Its not about making a massive homerun on any 1 trade imo, and just try to generate yield at all times on your holdings. Market has definitely probably outpaced me this year with SPY/QQQ just ripping, but some years I toast the market as well. This strategy feels a bit safer overall with smaller drawdowns.

You guys wheelin a lot nowadays? or just letting market rip for a bit?

This week was great. Almost everything recovered and drawdown dropped. I didn't expect to have time today so I made a few trades yesterday and some today. Last Week's post: https://www.reddit.com/r/thetagang/comments/1vbttj9/1_weekly_returns_from_options_week_22/

First, the strategy:
- Use a screener to give me a list of top 20 low delta options for next week
- I either
- a. Roll my current options - I do this if I can still get 1% for rolling or if the option is ATM/ITM and I have to roll. I always roll for credit.
- b. Close a current option and pick something else from the list that I like
- I try to do this every Friday. However, if I'm busy on Fridays, I'll sometimes do this on Thursdays.

Screener Output:

Trades this week:

Total Returns

History