Anybody sell LEAP strangles on individual stocks using PM account (for low margin requirements)?
An example might be SNKD: Closing price on 9/21): $1743
17 SEP 27 (361 DTE) options as follows:
870 Put (-50%): $71
3480 Call (+100%): $198
Total credit: $26,900
Margin Req for PM: $7505 (RegT RR would be $53k)
That's 26,900/7505 = 358% annual ROC which is, obviously, insane (and not realistic). I dont expect to make this but is 100% possible? 150%? Who knows.
So my question is:
1. How do you choose the stock to trade? What are the criteria you use to pick the stock?
2. How do you determine how many contracts to sell?
3. What DTE do you sell (and why)?
4. How do you choose the strikes?
5. Do you leg in or open both sides together?
6. How do you manage both profitable and losing positions?
7. Do you roll? - If so, what are you mechanics and when do you decide to roll?
8. Do you open it as "set-in-n-forget-it" and just keep some stop-loss?
9. How do you deal with earnings?
10. Anything else? Im sure Im missing many things to consider.