A THREAD:
BEST OPTIONS STRATEGY FOR CONSISTENT INCOME -
OPTIONS WHEEL STRATEGY
Everything to know about this strategy I'm posting in this thread.
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Step 1: Stock Selection
1. For this strategy you're going to have to choose some stocks that you think will be doing well in the future/long term.
2. Stock must be in an uptrend.
3. Stock options should be liquid enough to trade in.
4. List of stocks attached
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Step 2: Which option to sell?
1. Sell put at a support according to charts.
2. Sell put at a strike far away from the spot where you think the probability of the stock falling will be very very low.
3. Sell put at a price where you're willing to buy the stock at.
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Step 3: What to do when in profit/loss?
1. If in profit you can just roll up the puts thereby increasing the ROI or shift to other stocks to make more profit.
2. If in loss take delivery of the shares equivalent to the lot size in cash market.
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Step 4: What to do after taking the delivery?
1. Sell calls to lower your cost price of the stock. For eg, you took delivery of Reliance at 1900, sell 2100 CE which is about 10% away.
2. Keep doing this till your CE expires ITM and then give delivery of your stock away
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