The wheel ! Link in bio to learn more
@johannesbartlTranscript
My name is Jonas Bottle. I trade the wheel strategy and they'll make around 35% every single year. This is how I make my money. Instead of buying 100 shares of whatever company I like, I start with cash and I sell a cash secured put, which means I sell an option saying in the future, if the stock falls by whatever percent, then I'm willing to buy it. For that I get compensated money, which is called a premium. Now two things can happen. Number one, the stock actually falls below the strike price that I chose. Now here's what happens. Now instead of cash, I own shares. These shares I still own and now I can say I'm willing to sell a covered call. A covered call is nothing else, but saying in the future at a specific price, I'm willing to sell my shares to the market again. For that, I get compensated money, a premium. Two things can happen here. If it goes above that strike price, I get assigned. I have to sell my shares. I'm back in cash. Most likely over here, I get paid a capital appreciation as well. So in this wheel, I get paid once, twice and possibly three times in one cycle. Now what are the other two options? The other two options are I start with cash and then I sell a cash secured put. I get paid money, but it never falls below the price that I chose. So now I'm going back. I keep the premium. I go back to cash and I do this until I get assigned. Same thing happens here. Once I have the shares and I sell my covered calls and it never goes above the strike price that I chose, I just sit in here and I keep selling covered calls and collect that premium until I get assigned. And then the wheel is done.
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