Skip to main content
PROFITVISIONLAB
TOPIC

Options Strategy

27 articles
cover-covered-call-vs-cash-secured-put-beginner-tradeoffs-en.webp
Options Strategy

Covered Calls vs Cash-Secured Puts: How Beginners Should Actually Choose

Covered calls and cash-secured puts on the same strike and expiry share a near-identical payoff; the real differences are capital form, dividend rights and assignment direction. A covered call needs 100 shares ($5,000 for a $50 stock) and pays dividends but risks early assignment; a cash-secured put needs strike × 100 in cash ($4,750 at $47.50) and ends with you owning shares. Choose by asking whether you would own 100 shares at that strike, and require IV ≥ 30%, 30–45 DTE and open interest ≥ 100.

cover-options-selling-position-sizing-stop-loss-rules-en.webp
Options Strategy

Position Sizing and Stop-Loss Rules for Selling Options on US Stocks

Risk 1% of account equity per option sale (1.5% ceiling) and cap all positions in one underlying at 5% of the account in aggregate, built through 3–4 layered strike tranches. Sell at Delta 0.25–0.30, 30–45 DTE, open interest ≥ 100; halve the position at Delta 0.40 and close it at 0.55. Maximum loss per vertical contract is (width − credit) × 100. Naked selling is avoided; on S&P 500 names, multiply sized contracts by 0.3.

Your First Bull Put Spread on IBKR: From Level 3 Permissions to Position Exit
Trading System

Your First Bull Put Spread on IBKR: From Level 3 Permissions to Position Exit

Bull Put Spread is the ideal first strategy for options sellers: maximum loss is locked in before entry, margin requirements are low, and the logic is clean. This guide walks through every step on IBKR — from applying for Level 3 permissions to placing a Combo order and setting your 50% profit exit.

Why I Sell Options Instead of Buying Them: Probability, Theta & IV Premium
Trading System

Why I Sell Options Instead of Buying Them: Probability, Theta & IV Premium

Over 70% of options expire worthless — the market structurally favors sellers via three edges: probability, daily Theta decay, and the IV premium in every contract. This article explains why selling beats buying on a statistical level, and what that means for your trading system.

Delta, Theta, IV & Gamma: The Options Greeks Every Seller Needs to Know
Trading System

Delta, Theta, IV & Gamma: The Options Greeks Every Seller Needs to Know

Four Greek letters determine the behavior of every options position: Delta selects your strike, Theta earns you daily income, IV Rank times your entry, and Gamma signals when to exit. This guide explains each one through the lens of the options seller — concise, precise, and immediately actionable.

How to Read an Options Chain: Every Column Explained
Trading System

How to Read an Options Chain: Every Column Explained

An options chain looks like a wall of numbers — but every column tells you something precise. This guide decodes Bid, Ask, Strike, Delta, IV, and Open Interest row by row, so you can read any options chain and immediately know which contracts are liquid, fairly priced, and worth trading.

5 Core Options Terms Every Investor Must Know
Trading System

5 Core Options Terms Every Investor Must Know

Before placing your first options trade, five terms determine whether you know what you're doing: strike price, expiration date, premium, in-the-money, and out-of-the-money. This guide explains each with real options chain examples — so you never misread a contract again.

What Is an Options Contract? A Stock Investor's Guide to the Insurance Analogy
Trading System

What Is an Options Contract? A Stock Investor's Guide to the Insurance Analogy

Most stock investors think of options as complex speculation tools. This guide reframes everything: an options contract is simply a structured insurance policy. Learn what buyers and sellers each pay and collect — and why understanding this asymmetry is the first step toward options mastery.

The Options Seller's Four-Filter System: A Complete Guide to Systematic Stock Selection
Trading System

The Options Seller's Four-Filter System: A Complete Guide to Systematic Stock Selection

ProfitVision LAB · Options Seller Strategy · Systematic Stock Selection ProfitVision LAB · Core Belief Whether a seed grows into a giant sequoia is decided the moment it touches the ground three thousand years ago. Whether an options trader survives long-term is decided before the trade — at the moment of stock selection. 📌 Key Takeaways * The biggest reason options sellers lose money is not a flawed strategy — it's choosing the wrong underlying. The Four-Filter System wa

Options Market Reality Check: Who's on the Other Side When You Hit Buy?
Trading System

Options Market Reality Check: Who's on the Other Side When You Hit Buy?

U.S. options hit $2.7T daily notional in 2024—surpassing equities. Retail buyers lose 16.4% over 3 days on average. Sellers win 94% at expiry, but win rate is not profitability. Breaks down market depth, buyer/seller asymmetry, and the institutional cross-instrument toolbox.

Why the Options Selling System Works Better in US Markets Than Taiwan
Trading System

Why the Options Selling System Works Better in US Markets Than Taiwan

Options selling success depends on market structure, not strategy. US equity options offer institutional depth and real Defined Risk. Taiwan individual stock options lack liquidity; TXO faces overnight gap risk that can destroy an account in one session. Two markets, two survival equations.

Options Greeks for Sellers: The Actuary's Four Numbers
Trading System

Options Greeks for Sellers: The Actuary's Four Numbers

You don't need calculus to master options Greeks — think like an actuary. Delta is your claim probability, Theta is your daily premium income, Vega is your storm-season coefficient, and Gamma is the eye-of-the-storm accelerator. ProfitVision LAB's complete seller's Greeks framework.

IBKR: 7 Switches to Flip After Funding Your Account
Trading System

IBKR: 7 Switches to Flip After Funding Your Account

Don't rush to trade after funding. Spend 10 minutes enabling these 7 switches: stock lending, class action recovery, 4.8% cash interest, Portfolio Margin, transparent options commissions, dividend reinvestment, and recurring investments.

Bull Put Spread & Covered Call: Options Income Guide
Options Selling

Bull Put Spread & Covered Call: Options Income Guide

Don't predict direction — price risk. This guide unpacks Bull Put Spread and Covered Call income mechanics, optimal execution timing, and the Four-Layer Defensive Screen that ensures underlying quality — building a repeatable cash flow framework.

Q1 2026: From Naked Puts to Vertical Spreads
Trading System

Q1 2026: From Naked Puts to Vertical Spreads

ALAB gapped down 8% overnight. The 160P blew past my strike — a −$758 loss that wiped out multiple winning trades. That single event triggered a complete framework shift: every new position from March onward became a vertical spread with defined max loss before entry. 13 spreads. 13 wins.

Beyond Entry: NVDA Options Decision Framework
Trading System

Beyond Entry: NVDA Options Decision Framework

The breakout signal is public information. "What to do next" is where the real work begins. Using NVDA as a case study, this article builds a complete options decision framework across five layers: Four Defense Filters, Three Market States, exit strategy, reward-risk ratio, and position discipline.

Vertiv (VRT) Q1 2026: Computing Power Inflation Confirmed
Equity Deep Research

Vertiv (VRT) Q1 2026: Computing Power Inflation Confirmed

Q1 2026 validates the computing power inflation thesis: VRT revenue +30% YoY, Adj. EPS +83%, guidance raised. Four-Filter Screener: Active Watch — waiting for IV Rank recovery and 50MA hold before executing Bull Put Spread.

PMCC Pro: You're Not Collecting Rent — You're Collecting Panic
Trading System

PMCC Pro: You're Not Collecting Rent — You're Collecting Panic

Running PMCC on IBIT as a "stable rent trade" is the wrong framework. IBIT is a volatility vehicle — high IV is your edge, not your obstacle. Three core adjustments: defensive LEAP (Delta 0.80–0.90, 24 months), flexible Short Call (IV Rank-based), roll at 50% profit.

PMCC Advanced: The 1-Year LEAP vs. Time Decay
Trading System

PMCC Advanced: The 1-Year LEAP vs. Time Decay

1-year or 2-year LEAP? Not a preference — a risk management decision. Covers Theta acceleration, roll timing (trigger at 6–7 months), and three Short Call adjustments that transform PMCC from passive premium collection into active time management.

PMCC Intro: What Is a LEAP? Low-Cost Stock Exposure
Trading System

PMCC Intro: What Is a LEAP? Low-Cost Stock Exposure

LEAP is the most underrated tool in options. It lets you replicate stock Delta exposure using 20–30% of the capital, freeing the rest for deployment. This is the true starting point of PMCC. Part 1 of the PMCC Trilogy.