There’s a reason I talk about put selling so much in The War Room and Catalyst Cash-Outs.

The truth is… it’s one of my most consistent winning strategies.

In fact – so far this week I closed 3 winners for 50%+ return of premiums using just this strategy.

Those wins include MARA (63.64% return of premium in 225 days), ABSI (58% return of premium in 146 days), and MRVL (63% return of premium in 35 days.)

So how is my put selling strategy so effective? I’ll get to that more below. But first I should tell you what put selling is.

What is Put Selling…

Put selling is when you sell a put option. When you place the trade, you receive the premium from selling the put. That’s yours to keep no matter what.

In return, you’re saying that you know you can be obligated to buy the underlying shares at the strike price of the put, if the shares close at or below that level at any time and especially at expiration.

For example, I recently closed out Marvell Technologies (MRVL) puts, capturing 63% of the premium collected in just 35 days.

When War Room Members entered the trade, they sold puts for between $1.02 and $1.06. Less than 2 months later, they were able to buy them back for 42 cents or lower, keeping 60-64 cents of the original $1.02-$1.06 as profit.

4 Reasons Why My Put Selling Strategy is so Effective…

1. I choose only quality companies that we want members to own, but at our price.
2. I sell puts only on companies that offer members a chance to buy at a discount of 20% to 50% below the market price. If they are put, we are happy.
3. I recommend selling puts only on companies where the probability of being put is less than 25%, preferably less than 20%. This allows members to trade the puts since the discount is so high and the probability is so low.
4. I always recommend position sizing. Perhaps the most important aspect of put selling is to position size because you never know when you will be put the shares.

How to use put sells in your own trading

Yesterday I received a question in Catalyst Cash-Outs: “what’s the margin requirement for a put sell trade?”

It depends on 3 things.

First, who your broker is. Second, what the price of the stock is. And third, what’s the quality of the stock. In my case, I use Fidelity exclusively for my put sells.

Also, you should never use put sells in a retirement account because you can’t take advantage of margin. And margin is how you take advantage of a put sell in order to get a much better return.

For example, Fidelity charges me anywhere from 2% to 15% margin, ranging between 2% of the strike price to up to 15% of the strike price.

YOUR ACTION PLAN

Put selling might seem complicated if you’re a beginner trader – but with a little practice and permission from your broker – it can be a powerful strategy for consistent winning trades.

I’m currently teaching my process for put selling during our War Room Open House this week.

There’s still time to join and receive more free trade alerts over the next 3 days.

Click here to join The War Room Open House for FREE today.