To The Moon

Daily Options for Consistent Income Until Assigned

Trading options can be risky, but when approached with discipline and cash management, it becomes a strategic income-generating machine. One method I use actively is swing trading short-dated cash-secured puts (CSPs) on IWM, the iShares Russell 2000 ETF. This strategy has allowed me to earn consistent income, take advantage of high premiums, and manage risk through daily adjustments. Here’s a deeper dive into what CSPs are, how short-dated puts work, and how I execute my daily swing trades using IWM puts.

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💡 What is a Cash-Secured Put?

A cash-secured put is a conservative options strategy in which I sell a put option while holding enough cash to buy the underlying shares if assigned. For example, selling one IWM put contract at a $221 strike means I must reserve $22,100 in cash (100 shares x $221) in my account, in case the stock drops below $221 and the option gets assigned.

The benefit? I receive an upfront premium, which I keep no matter what happens—whether the option expires worthless or is exercised. It’s a win-win:

• If the stock stays above the strike price, I keep the premium.

• If the stock drops below the strike, I buy it at a discount (after subtracting the premium).

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🕰️ What are Short-Dated CSPs?

Short-dated puts are options with very little time left until expiration—typically 0 to 2 days. These options experience accelerated time decay (theta), which works in my favor as a seller.

Why use short-dated puts?

1. Faster premium collection – I can pocket 1-2% of the stock value in just a day or two.

2. More control – I can react daily to market conditions instead of waiting weeks.

3. Smaller risk window – Less time for the stock to move drastically against me.

For IWM, this is ideal because the ETF is relatively stable and liquid, with tight bid-ask spreads and high volume. This allows me to swing trade CSPs—selling and buying back puts intraday or daily—before expiry.

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📈 How I Swing Trade CSPs on IWM

Let’s take a look at some trades I executed on August 4th and 5th:

• Sold IWM 219 put expiring 2025-08-07 at 2.64

• Bought back same contract later at 2.61, locking in a small profit

• Later that night, I sold the 218 strike put for 1.41, targeting another high premium

And on August 5th, I repeated the process:

• Sold IWM 221 puts at prices ranging from 1.80 to 1.91

• Bought back several of those puts for 1.60 to 1.70

Each trade takes advantage of volatility spikes, slight pullbacks in IWM, and option premium inflation. Once the premiums compress, I buy back the put, locking in a tidy profit.

This is swing trading at its core:

• Quick in and out

• Capture time decay

• Stack small wins

Even if IWM does not drop significantly, the premium earned compensates for the risk. If the price stabilizes or moves up, I pocket even more.

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📊 Trade Management and My Next Plan

Risk management is key. I never overleverage. Every put I sell is backed 100% by cash in my money market fund, generating idle yield while waiting for assignment. This means:

• I can afford to be patient.

• I never face forced margin calls.

• I remain emotionally detached from each trade.

Now, to manage exits and rollouts, I use limit orders. For example:

I’ve already queued to buy back a 221 put at $0.10. If that fills, I immediately plan to sell another short-dated CSP, ideally targeting a $2.00 premium.

This rinse-and-repeat cycle lets me keep generating premium every 1–2 days.

Why $0.10 as a buyback target?

Because once 80–90% of the premium has decayed, I lock in profit and avoid sudden reversal risk. Holding too close to expiry invites assignment risk for a marginal gain—not worth it.

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💸 Premiums Stack Over Time

Let’s say I average $1.50 per trade, and I do this 3 times per week. That’s:

• $1.50 x 3 = $4.50 per week

• Over 4 weeks: $18.00

• That’s $1,800/month on a single CSP contract if not assigned

The best part? If I ever get assigned, I’m happy to own IWM at the discounted strike price because I see value in the Russell 2000. Once assigned, I can pivot to covered calls and generate income from the shares.

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🔁 Short-Term vs Long-Term View

Why not sell 30-day CSPs? The short answer: I want speed and flexibility. Long-term puts give me more premium, but they also tie up capital longer and are exposed to more market noise.

Short-dated options:

• Allow me to adapt daily

• Benefit from fast time decay

• Require precision but offer agility

This strategy requires discipline, awareness of volatility trends, and real-time decision-making—but it rewards me with compounding returns week after week.

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🚀 Final Thoughts and Next Steps

My IWM CSP strategy is about short-term precision and capital efficiency. I don’t blindly hold puts to expiry—I manage them dynamically. If volatility increases and premiums spike, I sell. If the premiums collapse or the market rallies, I buy them back.

Now that I’ve queued a buyback at $0.10, I’m preparing to strike again. My ideal next trade will be:

• Strike: Around 221 (or adjusted based on price action)

• Premium: Target $1.80 to $2.00

• Expiry: Within 2 days

• Exit: Auto buyback order at 0.10–0.20

And if I get assigned? I transition smoothly into covered calls, continuing to harvest income from the position.

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📚 Summary Table of Strategy

Element Detail

Strategy Swing trading short-dated cash-secured puts

Underlying Asset IWM ETF

Typical Premium $1.50–$2.50

Expiry Target 0–2 days

$IWM 20250805 218.0 PUT$ 

$IWM 20250805 218.0 PUT$ 

Exit Plan Buy back at 80–90% profit ($0.10–$0.20)

Frequency 3–4 trades per week

Assignment Plan Hold IWM, sell covered calls

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✅ This daily income strategy gives me control, capital efficiency, and consistent results. IWM, with its liquidity and option volume, is my preferred battleground—day in, day out.

If this continues, I’ll let the premiums pay for my next vacation. 😎📈

Let’s go make money!

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L

@MillionaireTiger @Wrtd @TigerStars @CaptainTiger @TigerEvents