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Generating Income with Cash-Secured Puts: How I Earned $400+ This Week

The Power of Cash-Secured Puts

Cash-secured puts are one of my favorite income-generating strategies. This week, I earned over $400 from trading Palantir (PLTR) put options—a strategy that not only added to my cash flow but also allowed me to enjoy a relaxing day trip to Johor Bahru (JB). Let me walk you through each trade and share how I executed them to maximize my earnings.

Trade Breakdown: Starting Strong with PLTR Puts

Trade 1: Selling the $81 PLTR Put

The first trade of the week was selling a $81 strike put option expiring December 27, 2024. I collected a premium of $5.63 per share (or $563 total for the 100-share contract). I chose this strike price because it offered a high premium while staying well above the current market price of PLTR, which limited my risk of assignment.

This trade was opened during a period of higher implied volatility, which naturally inflated the premium. Selling when volatility is high is a crucial tactic because it allows you to earn more for taking on the obligation to buy the stock.

Trade 2: Closing the $81 PLTR Put

Two weeks later, I noticed that PLTR’s volatility had subsided, and the option’s premium had dropped significantly. I decided to buy back the same $81 put option for just $1.54 per share (or $154 total), locking in a net profit of $409 on this single trade.

Timing the exit is just as important as the initial sale. I prefer closing positions when I can capture 70-80% of the maximum premium, ensuring I free up capital to reinvest in new opportunities.

Trade 3: Selling the $72.50 PLTR Put

Next, I shifted to a slightly lower strike price for my next trade, selling the $72.50 strike put expiring January 17, 2025. This trade collected a premium of $1.66 per share (or $166 total). The $72.50 strike was an attractive level because it gave me more downside protection while still offering a meaningful premium.

This trade reflects my approach of layering different strike prices to diversify risk and maintain a steady income stream.

Trade 4: Closing the $72.50 PLTR Put

After holding the $72.50 put for a short period, I bought it back at $1.62 per share, netting a modest profit of $4. While the profit wasn’t large, it freed up capital to execute my next trade, which turned out to be much more profitable.

Trade 5: Selling the $82 PLTR Put

The most recent trade in my PLTR series was selling a $82 strike put expiring January 3, 2025. I sold one contract for $2.20 per share (or $220 total). This strike price was slightly above the stock’s current price, but the premium was too enticing to pass up.

I timed this trade carefully during a brief spike in volatility, taking advantage of the market’s temporary uncertainty. Selling puts at higher strikes can yield bigger premiums but requires confidence in the stock’s fundamentals. For me, PLTR remains a solid long-term play, so I’m comfortable being assigned if it happens.

Trade 6: Refining the $82 PLTR Put

Shortly after, I bought back the same $82 put for $2.06 per share, capturing a $14 profit within minutes. I immediately turned around and sold another $82 put at a slightly reduced premium of $2.13 per share, locking in another chance to earn even more income.

By staying active and monitoring short-term price movements, I can “roll” my trades to take advantage of fluctuations, optimizing profits while maintaining a strong cash position.

Total Premiums: Over $400 in Weekly Income

Adding up all these trades, I netted over $400 in profits this week alone. This income supplements my regular cash flow and covers various expenses, including discretionary spending. Selling puts not only generates wealth but also provides flexibility to reinvest in new opportunities or enjoy life’s simple pleasures.

Enjoying the Fruits of My Labor: A Day Trip to JB

With my trading profits, I rewarded myself with a relaxing day trip to Johor Bahru (JB). My destination of choice was Otti Coffee, a charming café known for its artisanal brews and cozy ambiance. I treated myself to a premium coffee and enjoyed the peaceful atmosphere—a perfect way to unwind after a productive trading week.

The trip reminded me of why I love this strategy: it allows me to live life on my own terms, combining financial growth with personal enjoyment.

Final Thoughts: Using Cash-Secured Puts to Fund Your Lifestyle

Trading cash-secured puts is an excellent way to generate consistent income, whether you’re looking to cover daily expenses, fund small luxuries, or grow your portfolio. The key is to focus on high-quality stocks, select appropriate strike prices, and monitor the market for opportunities to close or roll positions.

This week’s success with PLTR reinforces my belief in this strategy. By earning over $400, I not only strengthened my financial position but also enjoyed the freedom to indulge in experiences like my trip to JB. If you’re seeking a reliable way to boost your income, cash-secured puts might just be the perfect strategy for you.

@MillionaireTiger 

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@CaptainTiger @CaptainTiger @TigerStars @TigerTradingNotes