StockFetcher Forums · General Discussion · New to Stock Fetcher - I sell puts and would like to automate<< >>Post Follow-up
3 posts
msg #120091
Ignore rdavi37741
5/26/2014 2:39:16 PM

I sell weekly puts on good stocks two weeks from expiration. Generally I sell them at the 1 SD strike price which gives me about an 85% probability of keeping the premium.

It has worked very well for me over quite a bit of time. I have read Kevin_in_Georgia's piece and it is helpful. While he use the ATR instead of SD it seems comparable although I would like to be able to use the 1 SD I'm used to.

Use Finviz to screen for companies over 10 Billion in market capitalization, average volume over 2 million shares traded, low short float, an analyst rating of buy or better, optionable and weekly volatility over 3%

Go through them all to see what stock have weekly options

Generally I use the Chaiken IPod app to measure quality.

Check to be sure earnings aren't coming up in the next few weeks

Use TastyTrade (Dough) to get the 1 SD point, probability of profit and return on capital

Look at each stock to guage support and resistance.

Use the Stocks+ app to check for the Max Pain figure. ( I like the Max Pain to be above the 1 SD)

Put all of this in a spreadsheet

I then select 3-6 each week using some personal judgement.

My biggest problem in Stock Fetcher is obtaining the options premium.

This really is time comsuming and I'd like to automate as much as possible. Any help out there? This is what I've come up with (Thanks Kevin)

symlist(aa,aal,aapl,abt,abx,can,adm,aet,afsi,agnc,agu,aig,akam, s,alxn,amd,amgn,amrn,amt,amzn,amzn7,anf,anr,aol,apa,apc,apol,aria,arna,athn,atvi,avp,axp,ba,bac,bax,bbby,bbry,bby,bhi,bidu,biib,bk,bmy,bp,brcm,btu,bx,c,cat,cbs,celg,cf,chk,cl,clf,cmcsa,cmg,cme,cmi,cof,coh,cop,cost,csco,cree,crm,

set{volatility, weekly atr(5)}
set{base, weekly close}
set{strikeprice, base - volatility}

add column weekly close {weekly close}
add column volatility
add column strikeprice {Target strike price for selling puts}

chart-display is weekly
draw price line at strikeprice

4,599 posts
msg #120092
Ignore Kevin_in_GA
5/26/2014 5:56:21 PM

If you are looking at monthly options two weeks from expiration, you probably want to use the 20 day SD. It can be easily calculated. This is what I do:


Set{2SD, 2 * cstddev(close,20)}
Set{sellput, close - 2SD}
Set{sellcall, close + 2SD}

Add column 2SD
Add column sellput
Add column sellcall

I would still also use a delta of less than 0.1 just to be sure.


3 posts
msg #120139
Ignore rdavi37741
5/27/2014 12:07:21 PM


It seems that your ATR is closer to the 1SD on Dough than the formula used. I'll tinker with it a bit but I assume that the difference is the tie to the volatility as opposed to the strike price alone.

Thanks for your help.


3 posts
msg #120166
Ignore rdavi37741
5/27/2014 1:58:39 PM


I generally trade only weekly options. If I have to roll a trade that is a monthly option I have to go another month out, more exposure than I like. Would this change the SD?

StockFetcher Forums · General Discussion · New to Stock Fetcher - I sell puts and would like to automate<< >>Post Follow-up

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