How To Sell A Put Option on Fidelity to Make $100s

I made $100 selling a put option. And here's how you can do the same. On June 23rd, I sold one put option against SPLG for a $129 credit with an expiration of $815 with a strike price of $68. On July 9th, I bought back that exact same option for $25. So, I sold it for $129, bought it back for 25, aka a net profit of $104. If you're wondering what kind of setup I wait for in order to do this type of trade, I'm paying attention to the VIX, which measures the volatility of the S& P 500 for the next 30 days, looking at SPY options. And if that number is extremely high, there's probably a lot of fear. There's a lot of uncertainty in the market. And if that number's low, things are probably calm and people aren't really paying attention to the market. So, anything above 20 is where I get interested in selling a put because I can make more money in terms of premium collected for doing that. So, July 23rd, it was around 21. At the same time, SPLG, which is the stock that I'm trading the options on, was sitting around $70. In terms of how I pick the option itself that I'm selling, I look for something around 45 days till expiration and then a delta of. 3. VIX is below 20 right now. So, I wouldn't put on this trade, but just going through the motions to show you how I pick the delta and which option to sell. SPLG, we're looking at Tasty Trade right now. The expiration dates aren't necessarily around 45, but I'd probably go with the 68day expiration date. And then in order to pick a strike price, I'd be looking for one that has a close to delta of. 3. So we'd pick the $71 strike price. And we'd be able to sell this for probably around $1. 30, aka $130. After selling it, I would set a buyback price at 80%. And with this product, you can only do $5 increments. So I would set the buyback price to 25. The stock stays flat or goes up, I'm going to make money on this trade. If it goes down and goes past that strike price, I'm gonna be tested on the trade mean meaning I'm going to be losing money. But usually what I'm going to do is roll out. So I'm going to buy back the option, sell a strike price that's lower and further own time to collect more credit and give myself more time for the trade. Lastly, if we're doing it in Fidelity, this is how you do it. You look up the symbol. So, SPLG. The action would be sell to open. The quantity is one. We're doing a put with an expiration of September 19th. And then the strike price would be 71 bucks. You can see that's the spread there. Uh you would put in the limit price that you're trying to sell it for. So, I'd do the midpoint 130 and then day margin. And you can also just do a uh good till cancelled um and then put on that trade. I know this is a long video but someone had asked a question about when I had talked about this strategy uh using margin without using margin and how you can um use your balance as collateral to sell puts but you don't activate the margin. This is the followup. This is the strategy that I utilize uh when the VIX is above 20. And this is how I juice the returns a little bit of my portfolio without depositing more money. So hopefully you enjoyed and thanks for watching.