Originally Posted by Buck Rogers (Post 3176915)

Always good for a discussion. I would look at doing this on a stand alone basis as a strangle(you are correct about the theoretical unlimited loss on the upside) Pretty low volume. A mitigating factor is, I bought RMO towards the close on Thursday after a PITA selling of RMO in Fidelity after the name change on Wed from RMG to RMO at 31. Had to call a broker at Fidelity because they didn’t handle the conversion as seamlessly as I would have wished. Nonetheless, it would be effectively a covered call with the naked put as you suggested. I opened a TT account and instead of paper trading( a good recc ) I have made some differing trades (IC, butterfly, strangle, vertical) to learn(no pain, no gain). Spent 1 day waiting on a fill, had to adjust the bid the next day to get filled. I suspect on a low volume stock like RMO that might also be a factor.

I have used the “duplicate me” of several TT traders but was wondering about my own pick. Seems the metrics are as good or better than a strangle from the pro’s at TT. I was tilting towards the strangle due to my long RMO stock but would have considered it on its own merits as well as what you are thinking. Since I am a Boomer and am well acquainted with all the “missionary positions” of options, I was interested in some of the “bark like a dog” or “pretzel positions”.

Signed,

An old dog trying to learn new tricks

Originally Posted by mispoken (Post 3177084)

Buck Rogers RMO isn’t terribly illiquid so it seems tradeable. Consider a February spread; its close to 45 days to expiration (Tasty trade target). I just plugged in the following February trade; sell the $20 put and buy the $15 put. This gets you, roughly, a $2.50 credit. So max loss is $2.50 (width of spread is $5 (20-15)) and max loss is width of spread minus credit collected (5-2.5). So let’s assume the stock tanks to $5, you give back the $2.50 you collected plus another $2.50. The probability of 50% profit on this is 66% (also a tasty trade target).

I like this trade. I’d put an order to sell the spread for $2.50 and if it executed put in a GTC to close it at 50% profit. (STC For $1.25...GTC).

Originally Posted by Buck Rogers (Post 3177100)

Thanks for that. Generally speaking, have you found that generating metrics like this trade with POP P50 and ROC are numerous? Or does it take either mimicking the pros or lots of "digging" to come up with appropriate trades. Additionally, do you vary your trade strategies for diversity, or have you found your "comfort zone" by restricting the strategies you employ to just a couple?

Originally Posted by LandGreen2 (Post 3177426)

I’ve owned SPY in the 401 for a few years and it has been good! After listening to Tastytrade seminars it seems like I’m leaving money on the table by not doing a covered call on long positions I own.

so if I did a cc on SPY, at 30 delta; 45 dte? If it gets excercised fine then seek the put at 30 delta too? Rinse repeat?? What do you guys think? Maybe just leave it alone and don’t screw withit!! Lol!

Originally Posted by mispoken (Post 3177116)

For my 45 DTE trades, I use almost exclusively naked puts and put spreads. (Also consider the $20 naked put, worst case scenario you are assigned 100 shares at a cost basis close to $15, if you have been wanting shares of this stock that’s a good option).

For earnings trades where I am trying to profit from the post earnings “volatility crush” I use iron condors, typically. Depending on how a stock moves after an earnings release I usually write another put spread or buy calls.

For my highest conviction companies, I dabble with buying deep in the money calls dated at least a year out. These move almost identically stock but require less capital (this is “stock replacement”).

For the statistical side of this, the RMO trade I posted is 66% P50, which are great odds. Realize though, you have to trade these often for the statistics to play out. This one might be a dud, but over time if you keep trading these ~70% trades, you should do well. Tastyworks makes it super easy.

Originally Posted by Buck Rogers (Post 3177535)

Intresting..Too bad Tegridy got his feathers ruffled. I would have liked to hear his opinion on this

Oh well

Originally Posted by Seneca Pilot (Post 3177506)

Ok, all the SPAC stocks for the most part go out with warrants. They cost pennies and are exercised at, typically, 11.50. They are then sold into the market to keep the company for exercising them for the same pennies they were bought at. This stock will find support at 11.50 ish after all the warrants have been exercised and either held or sold for profit. If you are going to mess with RMO you may get lower prices. The range will be 11.50 to 18.00 as the stock typically has to be at or above 18 for the warrants to be convertible.

Long story short the big drop is the warrant holders paying the company 11.50 for the shares then dumping them on the market at the highest price possible. One of Buffet's biggest plays through the years. Pay a few pennies for a warrant and sell the stock for a few thousand percent gain in a few months.

Current warrant price:
RMO.WT Stock Price | Romeo Power Inc. Wt Stock Quote (U.S.: NYSE) | MarketWatch