Selling a TNA Put for a High Premium – Smart Income Play
I sold a put option on TNA and collected a good premium, making this a strategic move to generate income while potentially buying shares at a discount. Here’s why this trade made sense:
1. Collecting Immediate Income with a High Premium 💰
By selling a put option, I received an upfront premium, which is free money as long as TNA stays above my strike price. The high volatility of TNA, being a leveraged ETF, allows for higher premiums compared to regular stocks.
• If TNA stays above my strike price, I keep the premium as pure profit.
• If TNA drops below my strike price, I buy it at a discount while still keeping the premium.
2. High Volatility = Higher Premiums 📈
TNA (Direxion Daily Small Cap Bull 3X Shares) is a triple-leveraged ETF, meaning it moves 3x the Russell 2000 index. The high volatility increases option premiums, making it attractive for option sellers like me.
• Selling a weekly or monthly put on TNA can often yield higher premiums than a regular stock.
• Even if assigned, I’m comfortable holding TNA and potentially selling covered calls on it.
3. Lowering My Cost Basis if Assigned 💸
If TNA falls below my strike price and I get assigned, I effectively buy shares at a lower net cost because of the premium received. This is a great way to enter a position at a discount.
• Example: If I sell a $40 strike put for $2.00, my effective cost is $38 per share.
• If TNA stays above $40, I keep the full $2.00 premium as profit.
4. Consistent Cash Flow Strategy 🔄
This strategy allows me to generate consistent weekly or monthly income. Even if I only make 1-2% per trade, repeating it multiple times a year adds up to double-digit returns without needing huge capital.
Final Thoughts: High Premium, Low Risk
Selling TNA puts is a smart move for collecting high premiums, capitalizing on volatility, and potentially buying shares at a discount. Whether I get assigned or not, I win either way—making it a solid income-generating strategy. 🚀@Daily_Discussion @TigerTradingNotes @MillionaireTiger @TigerTradingNotes @TigerEvents $TNA 20250425 25.0 PUT$
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
- 闪电侠08·03-21 12:38OkkkkLikeReport
