Weekly Commentary
Our Income Trader portfolio continues to shine with a total return of 159.2%.
We should be able to add to our total this week by locking in profits on our most conservative position, PFE. It’s only a paltry 1.4%, but the wheel approach lives on singles and doubles. Since we introduced PFE to the income wheel approach we’ve made a steady 30.89% in total returns (16 trades) while the stock has lost over 40%.
Next week we are on track to lock in 4.0% in BITO and 1.4% in XLU. As we have spoken about numerous times over the past month, I want to continue to ladder our positions going forward so we have the ability to reap returns on a weekly basis. So far, so good.
Current Positions
Open Date | Ticker | Stock Price (open) | Stock Price (current) | Strategy | Trade | Open Price | Current Price | Position Delta |
Income Wheel Portfolio - Open Trades | ||||||||
1/30/2024 | PFE | $27.38 | $27.94 | Covered Call | March 22, 2024 29 Call | $0.37 | $0.10 | 0.84 |
3/5/2024 | BITO | $31.72 | $31.68 | Selling Puts | March 28, 2024 28 Put | $1.05 | $0.61 | 0.2 |
2/26/2024 | XLU | $60.84 | $63.46 | Selling Puts | March 28, 2024 59.5 Put | $0.72 | $0.13 | 0.1 |
2/26/2024 | KO | $61.05 | $59.88 | Selling Puts | April 5, 2024 60 Puts | $0.60 | $0.70 | 0.51 |
2/22/2024 | DKNG | $40.33 | $41.78 | Selling Puts | March 28, 2024 38 Put | $1.15 | $0.25 | 0.13 |
Open Date | Close Date | Ticker | Strategy | Trade | Open Price | Closed Price | Profit | Return |
Income Wheel Portfolio - Closed Trades | ||||||||
6/2/2022 | 7/8/2022 | PFE | Short Put | July 8, 2022 50 Put | $0.65 | $0.00 | $0.65 | 1.30% |
6/10/2022 | 7/15/2022 | GDX | Short Put | July 15, 2022 29 Put | $0.66 | Assigned at $29 | ($2.75) | -9.48% |
6/10/2022 | 7/15/2022 | BITO | Short Put | July 15, 2022 16 Put | $0.82 | Assigned at $16 | ($2.09) | -13.10% |
6/22/2022 | 7/21/2022 | WFC | Short Put | July 29, 2022 35 Put | $0.80 | $0.02 | $0.78 | 2.23% |
6/30/2022 | 8/10/2022 | KO | Short Put | August 19, 2022 57.5 Put | $0.70 | $0.03 | $0.67 | 1.20% |
7/21/2022 | 8/10/2022 | WFC | Short Put | August 19, 2022 39 Put | $0.46 | $0.04 | $0.42 | 1.08% |
7/18/2022 | 8/17/2022 | BITO | Covered Call | August 19, 2022 16 Call | $0.50 | $0.03 | $0.47 | 3.59% |
7/18/2022 | 8/17/2022 | GDX | Covered Call | August 19, 2022 28 Call | $0.63 | $0.05 | $0.57 | 2.22% |
7/11/2022 | 8/23/2022 | PFE | Short Put | August 19, 2022 50 Put | $1.00 | Assigned at $50 | $0.21 | 0.43% |
7/26/2022 | 8/17/2022 | JPM | Short Put | September 16, 2022 100 Put | $1.22 | $0.16 | $1.06 | 1.10% |
8/17/2022 | 9/7/2022 | BITO | Covered Call | September 23, 2022 16.5 Call | $0.55 | $0.03 | $0.52 | 4.00% |
8/17/2022 | 9/7/2022 | GDX | Covered Call | September 23, 2022 28 Call | $0.59 | $0.07 | $0.52 | 2.03% |
8/23/2022 | 9/23/2022 | PFE | Covered Call | October 21, 2022 50 Call | $1.50 | $0.09 | $1.41 | 2.82% |
8/10/2022 | 9/23/2022 | KO | Short Put | September 23, 2022 60 Put | $0.62 | Assigned at $60 | ($0.78) | -1.30% |
8/10/2022 | 9/23/2022 | WFC | Short Put | September 23, 2022 41 Put | $0.61 | Assigned at $41 | $0.02 | 0.05% |
9/7/2022 | 10/17/2022 | BITO | Covered Call | October 21, 2022 14 Call | $0.40 | $0.03 | $0.37 | 2.60% |
9/7/2022 | 10/17/2022 | GDX | Covered Call | October 21, 2022 26 Call | $0.70 | $0.04 | $0.66 | 2.50% |
9/26/2022 | 10/21/2022 | WFC | Covered Call | October 21, 2022 41 Call | $1.30 | Called away at $41 | $1.89 | 4.67% |
9/26/2022 | 10/21/2022 | KO | Covered Call | October 21, 2022 60 Call | $0.70 | $0.00 | $0.70 | 1.20% |
9/23/2022 | 1028/2022 | PFE | Covered Call | October 28, 2022 47 Call | $0.56 | Called away at $47 | $3.49 | 7.43% |
10/17/2022 | 11/17/2022 | BITO | Covered Call | November 25, 2022 13.5 Call | $0.38 | $0.03 | $0.35 | 2.60% |
10/25/2022 | 11/17/2022 | WFC | Short Put | November 25, 2022 43 Put | $0.96 | $0.07 | $0.89 | 2.00% |
10/17/2022 | 11/25/2022 | GDX | Covered Call | November 25, 2022 26 Call | $0.58 | Called away at $26 | $1.09 | 3.87% |
10/25/2022 | 11/25/2022 | KO | Covered Call | November 25, 2022 60 Call | $0.80 | Called away at $60 | $2.20 | 3.75% |
11/3/2022 | 12/8/2022 | PFE | Short Put | December 16, 2022 45 Put | $1.08 | $0.02 | $1.06 | 2.36% |
11/17/2022 | 12/19/2022 | BITO | Covered Call | December 30, 2022 12 Call | $0.45 | $0.04 | $0.41 | 3.42% |
11/17/2022 | 12/30/2022 | WFC | Short Put | December 30, 2022 44 Put | $1.02 | Assigned at $44 | ($1.37) | -3.11% |
11/29/2023 | 1/9/2023 | GDX | Short Put | January 20, 2023 26 Put | $0.87 | $0.02 | $0.85 | 3.27% |
12/8/2022 | 1/13/2023 | PFE | Short Put | January 13, 2023 49 Put | $0.62 | Assigned at $49 | ($0.53) | -1.08% |
12/19/2022 | 1/20/2023 | BITO | Covered Call | January 20, 2023 11.5 Call | $0.30 | Called away at $11.5 | $1.49 | 14.70% |
11/29/2022 | 1/20/2023 | KO | Short Put | January 20, 2023 60 Put | $0.84 | $0.00 | $0.84 | 1.40% |
1/5/2023 | 2/17/2023 | WFC | Covered Call | February 17, 2023 45 Call | $0.84 | Called away at $45 | $4.23 | 10.17% |
1/9/2023 | 2/17/2023 | GDX | Short Put | February 17, 2023 29 Put | $0.54 | Assigned at $29 | ($0.05) | -0.10% |
1/23/2023 | 2/17/2023 | KO | Short Put | February 17, 2023 59 Put | $0.62 | $0.00 | $0.62 | 1.05% |
1/23/2023 | 2/17/2023 | BITO | Short Put | February 17, 2023 13.5 Put | $0.52 | $0.00 | $0.52 | 3.85% |
1/20/2023 | 3/1/2023 | PFE | Covered Call | March 3, 2023 46 Call | $1.00 | $0.02 | $0.98 | 2.18% |
2/22/2023 | 3/23/2023 | BITO | Short Put | March 31, 2023 31 Put | $0.50 | $0.05 | $0.45 | 3.46% |
2/22/2023 | 3/29/2023 | KO | Short Put | March 31, 2023 59 Put | $0.86 | $0.02 | $0.84 | 1.42% |
3/1/2023 | 3/29/2023 | PFE | Covered Call | April 6, 2023 42 Call | $0.65 | $0.05 | $0.60 | 1.43% |
2/21/2023 | 3/31/2023 | GDX | Covered Call | March 31, 2023 29.5 Call | $0.75 | Called away at $29.5 | $1.84 | 6.48% |
2/23/2023 | 3/31/2023 | WFC | Short Put | March 31, 2023 43 Put | $0.53 | Assigned at $43 | ($4.87) | -11.32% |
3/29/2023 | 4/28/2023 | KO | Short Put | May 19, 2023 60 Puts | $0.76 | $0.08 | $0.68 | 1.13% |
3/29/2023 | 4/28/2023 | PFE | Covered Call | May 19, 2023 42.5 Call | $0.53 | $0.05 | $0.48 | 1.23% |
4/4/2023 | 5/8/2023 | GDX | Short Put | May 19, 2023 32 Put | $0.78 | $0.70 | $0.71 | 2.22% |
3/23/2023 | 5/18/2023 | BITO | Short Put | May 19, 2023 15 Put | $1.10 | $0.03 | $1.07 | 7.13% |
4/4/2023 | 5/24/2023 | WFC | Covered Call | May 19, 2023 40 Call | $0.55 | Called away at $40 | $3.94 | 10.76% |
4/28/2023 | 6/16/2023 | PFE | Covered Call | June 16, 2023 40 Call | $0.63 | Called away at $40 | $1.71 | 4.40% |
3/29/2023 | 6/16/2023 | KO | Short Put | June 16, 2023 62.5 Put | $0.70 | Assigned at $62.5 | ($0.13) | -0.21% |
5/8/2023 | 6/16/2023 | GDX | Short Put | June 16, 2023 34 Put | $0.91 | Assigned at $34 | ($1.70) | -5.00% |
5/18/2023 | 6/30/2023 | BITO | Short Put | June 30, 2023 14 Put | $0.45 | $0.01 | $0.44 | 3.14% |
5/24/2023 | 7/6/2023 | WFC | Short put | July 21, 2023 37.5 Put | $1.01 | $0.09 | $0.92 | 2.54% |
6/30/2023 | 7/24/2023 | DKNG | Short Put | August 18, 2023 22.5 Put | $0.63 | $0.09 | $0.54 | 2.40% |
7/6/2023 | 7/24/2023 | WFC | Short Put | August 25, 2023 40 Put | $0.76 | $0.12 | $0.64 | 1.60% |
6/21/2023 | 8/18/2023 | PFE | Short Put | August 18, 2023 37.5 Put | $0.64 | Assigned at $37.5 | ($0.24) | -0.64% |
6/21/2023 | 8/18/2023 | GDX | Covered Call | August 18, 2023 33 Call | $0.52 | $0.00 | $0.52 | 1.60% |
6/21/2023 | 8/18/2023 | KO | Covered Call | August 18, 2023 62.5 Call | $0.85 | $0.00 | $0.85 | 1.40% |
6/30/2023 | 8/18/2023 | BITO | Short Put | August 18, 2023 15 Put | $0.78 | Assigned at $15 | ($0.78) | -5.20% |
7/24/2023 | 9/14/2023 | DKNG | Short Put | September 15, 2023 28 Put | $1.36 | $0.02 | $1.34 | 4.79% |
8/21/2023 | 9/14/2023 | PFE | Covered Call | September 29, 2023 38 Call | $0.78 | $0.02 | $0.76 | 2.00% |
8/21/2023 | 9/14/2023 | KO | Covered Call | September 29, 2023 61 Call | $0.78 | $0.03 | $0.75 | 1.23% |
7/24/2023 | 9/15/2023 | WFC | Short Put | September 15, 2023 45 Put | $0.85 | Assigned at $45 | ($1.20) | -2.67% |
8/21/2023 | 9/29/2023 | BITO | CoveredCall | September 29, 2023 14 Call | $0.48 | $0.00 | $0.48 | 3.58% |
9/14/2023 | 10/13/2023 | PFE | CoveredCall | October 20, 2023 35 Call | $0.58 | $0.04 | $0.54 | 1.47% |
9/14/2023 | 10/13/2023 | KO | CoveredCall | October 27, 2023 59 Call | $0.95 | $0.03 | $0.92 | 1.49% |
9/14/2023 | 10/20/2023 | DKNG | Short Put | October 20, 2023 30 Put | $0.98 | Assigned at $30 | ($1.95) | -6.50% |
8/21/2023 | 10/20/2023 | GDX | Covered Call | October 20, 2023 29 Call | $0.86 | $0.00 | $0.86 | 3.11% |
9/18/2023 | 10/20/2023 | WFC | Covered Call | October 20, 2023 44.5 Call | $0.89 | $0.00 | $0.89 | 2.05% |
10/13/2023 | 11/9/2023 | PFE | Covered Call | November 24, 2023 34 Call | $0.62 | $0.03 | $0.59 | 1.80% |
10/23/2023 | 11/13/2023 | GDX | Covered Call | December 1, 2023 31.5 Call | $0.58 | $0.04 | $0.54 | 1.80% |
10/23/2023 | 11/17/2023 | DKNG | Covered Call | November 17, 2023 32 Call | $0.87 | Called away at $32 | $2.87 | 9.57% |
10/2/2023 | 11/17/2023 | BITO | Covered Call | November 17, 2023 15 Call | $0.47 | Called away at $15 | $0.47 | 3.13% |
10/13/2023 | 11/24/2023 | KO | Covered Call | November 24, 2023 55 Call | $0.75 | Called away at $55 | ($6.75) | -10.80% |
10/23/2023 | 12/1/2023 | WFC | Covered Call | December 1, 2023 41 Call | $0.87 | Called away at $41 | ($3.13) | -6.95% |
10/25/2023 | 12/5/2023 | XLU | Short Put | December 15, 2023 56 Put | $0.80 | $0.02 | $0.78 | 1.39% |
11/9/2023 | 12/15/2023 | PFE | Covered Call | December 15, 2023 31 Call | $0.62 | $0.00 | $0.62 | 2.08% |
11/20/2023 | 12/15/2023 | DKNG | Short Put | December 15, 2023 36 Put | $0.65 | Assigned at $36 | $0.00 | 0.00% |
11/20/2023 | 12/20/2023 | BITO | Short Put | December 22, 2023 16.5 Put | $0.50 | $0.02 | $0.48 | 2.91% |
12/5/2023 | 1/11/2024 | XLU | Short Put | January 19, 2024 61 Put | $0.80 | $0.11 | $0.69 | 1.10% |
11/27/2023 | 1/11/2024 | KO | Short Put | January 19, 2024 57.5 Put | $0.76 | $0.04 | $0.72 | 1.25% |
12/18/2023 | 1/19/2024 | DKNG | Covered Call | January 19, 2024 38 Call | $0.83 | $0.00 | $0.83 | 2.34% |
11/13/2023 | 1/19/2024 | GDX | Covered Call | January 19, 2024 29 Call | $0.62 | $0.00 | $0.62 | 2.27% |
12/20/2023 | 1/19/2024 | BITO | Short Put | January 19, 2024 20 Put | $0.78 | $0.00 | $0.78 | 3.90% |
12/18/2023 | 1/26/2024 | PFE | Covered Call | January 26, 2024 28 Call | $0.46 | $0.00 | $0.46 | 1.68% |
1/23/2024 | 2/12/2024 | GDX | Covered Call | February 16, 2024 29 call | $0.45 | $0.04 | $0.41 | 1.47% |
1/23/2024 | 2/16/2024 | DKNG | Covered Call | February 16, 2024 41 Call | $1.14 | Called away at $41 | $6.14 | 17.10% |
1/11/2024 | 2/23/2024 | XLU | Short Put | February 23, 2024 61 Put | $0.65 | $0.00 | $0.65 | 1.07% |
1/11/2024 | 2/23/2024 | KO | Short Put | February 23, 2024 59 Put | $0.70 | $0.00 | $0.70 | 1.12% |
2/2/2024 | 3/5/2024 | BITO | Short Put | March 15, 2024 19 Put | $1.15 | $0.06 | $1.09 | 5.74% |
2/12/2024 | 3/10/2024 | GDX | Covered Call | March 15, 2024 29 Call | $0.44 | Called away at $29 | $2.14 | 7.83% |
159.22% |
Weekly High-Probability Mean Reversion Indicator
Below is my watch list of ETFs and stocks with the most liquid options headed into the week of March 18, 2024.
Here are the various levels I use to determine if an ETF is in an oversold or overbought state.
Very Overbought | a reading greater than or equal to 80.0 |
Overbought | greater than or equal to 60.0 |
Neutral | between 40 to 60 |
Oversold | less than or equal to 40.0 |
Very Oversold | less than or equal to 20.0. |
Each week I also include the current implied volatility (IV) and IV Rank. I look for an IV rank above 40, preferably higher.
ETF Watchlist – Weekly Trade Ideas
Exchange Traded Fund | Ticker Symbol | IV | IV Rank | HPMR Oversold - Overbought |
ARK Innovation ETF | ARKK | 40.9 | 32.1 | 35.6 |
ProShares Bitcoin ETF | BITO | 88.5 | 84.4 | 58.4 |
SPDR Dow Jones | DIA | 13.2 | 21.6 | 39.6 |
iShares MSCI Emerging Markets | EEM | 18.0 | 18.1 | 51.5 |
iShares MSCI EAFE | EFA | 12.2 | 8.6 | 58.7 |
iShares MSCI Mexico ETF | EWW | 20.2 | 26.4 | 62.7 |
iShares MSCI Brazil | EWZ | 22.8 | 25.8 | 34.3 |
iShares China Large-Cap | FXI | 31.5 | 43.1 | 53.1 |
VanEck Gold Miners | GDX | 36.6 | 48.9 | 66.6 |
SPDR Gold | GLD | 13.5 | 46.3 | 64.4 |
iShares High-Yield | HYG | 6.0 | 9.7 | 36.7 |
iShares Russell 2000 | IWM | 21.6 | 35.1 | 42.2 |
SPDR Regional Bank | KRE | 31.7 | 28.4 | 38.4 |
VanEck Oil Services | OIH | 26.5 | 4.1 | 84 |
Invesco Nasdaq 100 | QQQ | 19.8 | 33.8 | 40.7 |
iShares Silver Trust | SLV | 26.9 | 34.8 | 78.4 |
VanEck Semiconductor | SMH | 39.0 | 105.6 | 46.7 |
SPDR S&P 500 | SPY | 14.4 | 20.3 | 46.5 |
iShares 20+ Treasury Bond | TLT | 14.4 | 8.3 | 29.4 |
United States Oil Fund | USO | 28.6 | 19.2 | 72 |
ProShares Ultra VIX Short | UVXY | 108.7 | 32.3 | 55.1 |
CBOE Market Volatility Index | VIX | 92.2 | 66.9 | 53.6 |
Barclays S&P 500 VIX ETN | VXX | 74.3 | 37.2 | 55.6 |
SPDR Biotech | XLB | 18.2 | 23.6 | 73.7 |
SPDR Energy Select | XLE | 18.5 | -0.4 | 86.9 |
SPDR Financials | XLF | 16.1 | 11 | 61.1 |
SPDR Utilities | XLU | 18.2 | 23 | 57.6 |
SPDR S&P Oil & Gas Explorer | XOP | 23.3 | 1.3 | 87.3 |
SPDR Retail | XRT | 22.3 | 32 | 53 |
Stock Watchlist – Weekly Trade Ideas
Stock - Income Trader | Ticker Symbol | IV | IV Rank | HPMR Oversold - Overbought |
Apple | AAPL | 23.0 | 35.0 | 41.2 |
Bank of America | BAC | 25.5 | 14.5 | 53.5 |
Bristol-Myers Squibb | BMY | 25.7 | 59.8 | 48.1 |
Citigroup | C | 30.3 | 26.7 | 64.6 |
Caterpillar | CAT | 27.1 | 29.8 | 76 |
Comcast | CMCSA | 27.8 | 35.4 | 51.7 |
Costco | COST | 19.1 | 18.5 | 40.7 |
Cisco Systems | CSCO | 19.9 | 21.4 | 40.5 |
Chevron | CVX | 19.7 | 11.5 | 71.1 |
Disney | DIS | 25.3 | 24.0 | 58.2 |
Duke Energy | DUK | 16.7 | 8.9 | 57 |
Gilead Sciences | GILD | 25.0 | 24.6 | 45.3 |
General Motors | GM | 28.7 | 6.0 | 61.1 |
Intel | INTC | 38.5 | 31.3 | 40.4 |
Johnson & Johnson | JNJ | 17.1 | 40.2 | 37.3 |
JPMorgan | JPM | 24.1 | 33.5 | 64.1 |
Coca-Cola | KO | 14.2 | 17.4 | 44.4 |
Altria Group | MO | 20.4 | 33.6 | 76 |
Merck | MRK | 25.1 | 68.4 | 31 |
Morgan Stanley | MS | 25.6 | 23.6 | 57.2 |
Microsoft | MSFT | 23.0 | 21.9 | 56.1 |
NextEra Energy | NEE | 27.8 | 36.9 | 79 |
Nvidia | NVDA | 64.2 | 87.6 | 56.4 |
Pfizer | PFE | 26.7 | 48.9 | 58.4 |
PayPal | PYPL | 35.6 | 24.1 | 74.6 |
Starbucks | SBUX | 23.5 | 28.9 | 30 |
AT&T | T | 24.1 | 23.2 | 47.9 |
Verizon | VZ | 22.3 | 32 | 35 |
Walgreens Boots Alliance | WBA | 52.2 | 80.9 | 41.7 |
Wells Fargo | WFC | 29.8 | 24.9 | 75 |
Walmart | WMT | 16.9 | 36.4 | 60.1 |
Exxon Mobil | XOM | 20.6 | 2.9 | 79 |
Weekly Trade Discussion: Open Positions
Income Wheel Portfolio: Open Positions
Covered Calls: PFE March 22, 2024, 29 Calls
Original trade published on 1-30-2024 (click here to see original alert)
Current Comments: We sold the March 22, 2024, 29 calls for $0.37. At the time of the alert, PFE was trading for 27.38.
Now, with PFE trading for 27.94, the probability of closing at expiration out of the money stands at 84.43%, and the price of the 29 calls sits at roughly $0.10. There are 5 days left in the March 22, 2024, expiration cycle. I plan to buy back our calls and immediately sell more calls early this week.
Selling Puts: BITO March 28, 2024, 28 Puts
Original trade published on 3-5-2024 (click here to see original alert)
Current Comments: We sold the March 28, 2024, 28 puts for $1.05. At the time of the alert, BITO was trading for 31.72.
Now, with BITO trading for 31.68, the probability of closing at expiration out of the money stands at 74.83%, and the price of the 28 puts sits at roughly $0.62. There are 11 days left in the March 28, 2024, expiration cycle. There is a good chance we will be adding to our total returns of over 45% in BITO at the March 28 expiration cycle if the ETF stays above the 28 strike over the next 11 days.
Selling Puts: DKNG March 28, 2024, 38 Puts
Original trade published on 2-22-2024 (click here to see original alert)
Current Comments: We sold the March 28, 2024, 38 puts for $1.15. At the time of the alert, DKNG was trading for 40.33.
Now, with DKNG trading for 41.78, the probability of closing at expiration out of the money stands at 85.09%, and the price of the 38 puts sits at roughly $0.26. There are 11 days left in the March 28, 2024, expiration cycle. If we see a resumption of a push higher in DKNG this week, I plan to buy back our puts, lock in profits and immediately sell more put premium.
Selling Puts: XLU March 28, 2024, 59.5 Puts
Original trade published on 2-26-2024 (click here to see original alert)
Current Comments: We sold the March 28, 2024, 59.5 puts for $0.72. At the time of the alert, XLU was trading for 60.84.
Now, with XLU trading for 63.46, the probability of closing at expiration out of the money stands at 88.77%, and the price of the 59.5 puts sits at roughly $0.18. There are 11 days left in the March 28, 2024 expiration cycle.
Selling Puts: KO April 5, 2024, 60 Puts
Original trade published on 2-26-2024 (click here to see original alert)
Current Comments: We sold the April 5, 2024, 60 puts for $0.60. At the time of the alert, KO was trading for 61.05.
Now, with KO trading for 59.88, the probability of closing at expiration out of the money stands at 48.25%, and the price of the 60 puts sits at roughly $0.70. There are 19 days left in the April 5, 2024, expiration cycle.
As always, if you have any questions, please do not hesitate to email me at andy@cabotwealth.com.
The next Cabot Options Institute – Income Trader issue will be
published on March 25, 2024.
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