To The Moon

How I earn $110 with $9000 sell secured put Google option $Alphabet(GOOGL)$ $Invesco QQQ Trust(QQQ)$ Gather 'round because I've got a story to tell. Brace yourselves for a thrilling tale of how I turned a measly $110 into a sweet profit in just ten days. That's right, folks – it's time to talk about trading options, specifically selling a put option on our beloved Google (GOOGL) stock. Now, before we dive into the nitty-gritty, let's get a quick overview of the situation. During the period from June 27, 2023, to July 6, 2023, Google's stock price was fluctuating between $117 and $122. Armed with this information, I decided to take a calculated risk and try my hand at trading options. For those unfamiliar with options, let me break it down for you. When you sell a put option, you're essentially giving someone else the right to sell you 100 shares of a particular stock at a specific price (known as the strike price) within a given timeframe (until the expiry date). In exchange for taking on this obligation, you receive a premium upfront. The beauty of this strategy is that it can be quite profitable if the stock price remains above the strike price. In my case, I sold a put option on Google with a strike price of $100, and the expiry date was set for December 2025. Remember, one contract represents 100 shares, so I had the obligation to potentially buy 100 shares of Google at $100 each. Now, let's get to the exciting part – the numbers! I sold the put option for a premium of $10 per share. Multiply that by 100 shares (one contract), and I received a total premium of $1,000 upfront. Cha-ching! But how did I make a profit in just ten days, you ask? Well, here's where the price movement of Google's stock comes into play. Since I believed that Google's stock would stay above $100, I took the risk and hoped for the best. As luck would have it, the stock price indeed stayed well above $100 during the ten-day period. As a result, the value of the put option decreased, and I was able to buy it back at a lower price. Specifically, I bought back the put option at $8.90 per share, spending a total of $890 to close the position. Let's do some math, shall we? I initially received a premium of $1,000, and I spent $890 to buy back the put option. So, my profit was $1,000 - $890 = $110. Not too shabby for just ten days of work, huh? Now, let's talk about the risks involved in this strategy. Selling a put option comes with two main risks: the maximum risk and the maximum profit. The maximum risk occurs if the stock price plummets below the strike price (in this case, $100). If that happens, I will be obligated to buy 100 shares of Google at $100 each, even if the market price is much lower. So, it's crucial to choose a strike price and expiration date that align with your risk tolerance and market expectations. On the other hand, the maximum profit is limited to the premium you receive upfront. In this scenario, my maximum profit was $1,000 since that was the premium I earned by selling the put option. However, keep in mind that commissions and fees might slightly reduce your final profit. Lastly, let's touch on a strategy called cash-secured put. It's a safer approach to selling put options because it involves setting aside enough cash to cover the purchase of the underlying stock if it gets assigned to you. In other words, if I didn't have enough cash on hand to buy 100 shares of Google at $100 each, I wouldn't have been able to execute this strategy. So, always make sure you have the necessary funds to fulfill your obligations. And there you have it, my fellow 2 broke girls and guys – a thrilling adventure in the world of options trading. With a little bit of luck, a dash of market analysis, and a whole lot of risk management, I turned $110 into a cool profit in just ten days. Remember, though, that options trading can be risky, so it's important to educate yourself and proceed with caution. Disclaimer: The information in this article is for educational purposes only and should not be considered financial advice. Always do your own research and consult with a qualified financial professional before making any investment decisions. Happy trading, everyone! 🐯 🐯🐯🐯🐯🐯 Dear tiger readers Please help to share post also clicking the repost button and follow me as I published my post on my ideas and trading experiences and sometimes including my current dividend positions and winning sell call and put trades . 🦁🦁🦁🦁🦁Do follow me share my posts regularly So more people can learn about my trading methods and winning trades on selling covered calls and puts options I share my options trade below usually I sell at a higher price then buy back at a lower price for a profit I 🌈🌈🌈🌈🌈🌈🌈🌈 As always do your on due diligence and tradings have risks Do feature me @Daily_Discussion @SGX_Stars @TigerPM @SGX_Stars @TigerStars so more people learn sell cash covered put on good stocks and earn 1% or more per month