A Lucrative Options Strategy for AMZN

In this video we’ll share with you a unique strategy that professional options traders like to use that take advantage of volatile …

26 thoughts on “A Lucrative Options Strategy for AMZN”

  1. What if AMZN closed below the short put on the straddle? Would you allow assignment of another 100 shares of AMZN or would you roll your short put down and out?

  2. With all due respect, selling naked put is not for the faint of heart. To open a naked put position at 3000 you will need a solid 300 grand in your account to pledge. How many of your viewers have that for a single position ? Also for 300K risk you have $ 2800 return so look at the odds and reward. Is this how the so called "professionals" trade there ?

  3. Would it offer any advantage if I sell the naked put with an EXPD in October, in stead of September, i.e., making the naked PUT contract to expire around the same time that the Oct 16 straddle expires, to avoid being assigned the first 100 shares and holding onto it ?

  4. Nice video! Is it accurate to say that to run execute this strategy, I would need 2 times of 100 shares of buying power for the underlying equity? (Purchase power for the first 100 shares for the Sept PUT, and another for the 100 shares shorted in the straddle)?

  5. Is the income options training webinar good for someone like me who is just now getting started? I have not done any trades, I am learning through various videos, books, and tutorials while learning a paper trading account system. Also will the webinar be available to me afterwards for follow up?

  6. What if AMZN keeps dropping and instead you get assigned another put ? Now you have 200 shares of AMZN. If AMZN drops by an amount below the sum of the premiums sold, then you are in a significant hole. It works as long as AMZN keeps growing which is high probability. But one such bad month can wipe you clean. Best and the most prudent thing will be after the first assignment just sell calls and convert your position to a covered call position.

  7. I notice you guys mainly make options video about selling options. I think it would be a great idea if you guys did a video on buying options. For example, there are lessons to be learned as it pertains to reading premiums (options prices staying strong despite the stock dropping or the premium dropping quickly off a tiny pullback).

  8. These videos are always a good exercise for newbies to think about what the massive potential losses are, which they haven't shown in any of the last dozen videos I've watched from them. If you watch an options video and it seems like you can't lose, the answer is a) don't trade the option strategy yet b/c these videos only show the positive side and b) you can absolutely lose.

  9. How much collateral does your broker require to seek a short straddle?
    Would it be $300000 on top of the 100 shares?

  10. At 3:53 think you meant "the put seller " pockets the premium". Also to sell one 3000 AMZN Put, you assume the person to have at least 300,000 in cash or in their brokerage margin account, which many retail investors (not working for a trading firm) do not have, unless they are approved for Level 4 (where they can sell naked puts) which will not be likely if they are a new options investor. Great video on the concept though:)

  11. Is it really prudent risk management, to put another 300k at risk when 300k was already assigned? One bad month could blow up the whole account. Lol if an SMb trader put on this position he/she wouldn't get a talking to? I do love your material by the way. Just wondering cause u guys emphasize risk management alot and I've come back from some big losses and have been paying alot of attention to my sizing in the last couple of years.

  12. I like the idea of selling premium to get stock at a lower cost basis but I'd rather cap losses by using a put credit spread. If stock is put to investor selling an ATM call poses no risk on upside. Investor will receive juicy premium but again… I'd sell an item otm credit spread. If 2nd naked put gets assigned now investor has 200 shares. That's a lot of capital on the table. I like this income strategy. Any put premium received will better than a dividend. But the risk of being naked is too great imo. Always spread those puts. Defined risk.

  13. Awesome information Seth! I'm growing my account weekly and look forward to applying this strategy when I have an account large enough!

  14. What happens if AMZN does a further big drop below the sold put and afterwards starts to rally far above, both before expiration, so that both sold options get exercised?

  15. Ive been reading Mike's books and was wondering what is a good book to learn about options in a way that Seth breaks them down. Any suggestion? I started reading Mcmillan on Options, and its pretty straight forward and simple, but, to me, there is no real "technical" breakdown the way that Seth explains.

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