Most traders spend years trying to get

consistently profitable. I bet you watch

so many different videos, switch

strategies, tried to learn these crazy

setups, and honestly, it might still not

be working for you. You still can't

consistently profit in the market

reliably. So, in this course, I have a

meticulous, curated, a perfect

step-by-step road map showing you

exactly how I personally have managed to

become a consistent, profitable trader,

and have grown my portfolio to $4

million with regular stock trading and

primarily option trading. I'm not

promising any results. I'm not allowed

to do that on YouTube. And of course,

trading can be risky, but I'm going to

be showing you all of the inside

secrets, all of the inside strategies,

all the knowledge that I've have had for

the last 12 years that has helped me

personally retire, as well as a couple

thousand of my students. And I'm going

to share all of this for free. Of

course, trade at your own risk. This

video is for educational purposes only.

On the screen right now are a list of

timestamps and chapters that I will go

through in this course in showing how I

got into option trading and became

consistently profitable. Now, for me,

this is a deeply personal topic because

finance really controls our lives. When

I was 19 years old and I had $2,000 in

savings, I decided that during that

internship, I was going to learn

everything that I could about options

because I saw that the option traders

that I was working with were making like

$10,000 a day. And I thought $10,000 a

month was something that I would never

even achieve in my life. Once I got my

portfolio to $50,000, that's when I

really saw that my portfolio started to

skyrocket because money was finally

working for me. like getting to $50,000

took a lot of time and honestly a lot of

mistakes as well. Now my portfolio is in

a good place where at $4 million it's

actually well above what I even need for

a consistent retirement income. So I'm

glad to officially announce that in my

early 30s I am able to retire and live

in different countries and have a more

freedom based lifestyle. So I'd love to

help you in this course and I think this

course is going to change your life. An

option is just a contract that gives you

the right but not the obligation to buy

or sell 100 shares of a stock. So

there's two main types of options. Call

options, which I'm showing you right

now, and put options. Every option

contract usually controls 100 shares.

That is always a constant. Now, options

have an expiration. So, as we see here,

I'm using the August 21st expiration.

So, they do not last forever. All

options eventually expire. You just get

to pick the expiration date. That's

really cool because as an investor, you

get to make a bet and then you also get

to choose a time frame that works for

you based off of your view. So, let's

say that, you know, Apple is trading for

$270 per share and you sell a $260 put

option, that means that, you know,

someone is betting that the stock will

go down because if you buy a put option,

you're betting it going down. If you're

selling a put option, that means you're

betting on it not going down. Okay? And

if you sell a put option, for example,

you collect income. If you buy a put

option, you are spending money to buy

that option. So you are paying what's

called a debit. So there's debits and

credits. Debits is basically when you're

paying and a credit is when you are

receiving. Whenever you're buying

options, it's a debit. And then whenever

you're selling options, it is a credit.

So by the way, selling puts is one of

the two passive income strategies that

you're going to learn in this video.

We're going to start off with buying a

call option. And I'll explain to you how

this works. And then we'll go into the

passive income strategies that I

personally like to use in my own

portfolio. So, here's what a buy call

option is. Let's say that, you know, we

think the stock is going to run further

on American Airlines. If you buy an 18

call option right here, that is your

strike price. You want it to go above

18, the premium that you pay, this $130

is basically the premium that you have

to pay a debit for. Okay? So, if you pay

this debit and your strike price is 18,

your break even price is going to be

$19.30.

Okay? So, if I click into this option

now, you will see some statistics on

this option. You can see the mark, the

previous close, the chance of profit.

And by the way, the chance of profit is

based off of delta. Typically, here it's

very different. So, I would go with

delta. Okay, what is delta? Well, delta

is basically two different definitions.

They're both pretty easy, so write this

down if you have to. The first

definition of delta is that if a stock

goes up by $1 and delta is 0.5, like

with this example right here on American

Airlines, that means that for every $1

move in the stock, the option will move

50. So the delta basically tells you the

sensitivity of how much this option is

going to move. So if it's 70 delta, then

it's going to go up.7 cents per $1 move

in the underlying stock. Now another

definition of delta is the chance that

the option will expire in the money. And

that's why this option right here, which

is really, really close to what American

Airlines is currently trading at, has a

delta of 49 or basically 50 because it's

right there. So there's basically a

50/50 chance. So options and trading is

pretty interesting because at the money,

right, when a stock is right at the

money to the strike price, meaning it's

very very similar in price, you don't

really know what direction, right? So

the option market assumes we don't

really know too much direction. Now, in

some cases, of course, there's a

something called a skew. So an option

could be worth more. For example, a call

could be worth more than a put, but

typically it is going to be a 50 delta

if it's right there at the money. So, a

$20 stock that's trading at $20 and you

buy a $20 call option, it'll have a 50

delta. A put option that's also at $20

will have a 50 delta because the option

market is typically not taking

direction. Okay, it's assuming that

there's a 50-50 chance that the stock

will go up or down. That's pretty

interesting and pretty cool. So, here

there's about a 50% chance that American

Airlines will be 18 or or higher, right?

So, as the stock goes higher, this call

option benefits. It gains value. So the

break even is going to be the strike

price plus the premium that you pay and

then you start making money above that.

However, that assumes that you hold this

option until expiration. You can always

trade options before before they expire

really. So if you buy an $18 call option

and American Airlines starts to go up

and it hits $18 per share, this call

option could be worth more. It could be

worth a good deal more because currently

it's trading for $1741.

So if it goes up, you know, by 60 cents

on the stock, well, this option might

gain, you know, half that value, 30

cents, right? Because of delta, again,

going back to delta, it's 50. So here,

this option could increase by 30. And

although that might not seem like a lot,

the 30 cents increase would be against

the premium that you pay, which is $130.

So a 30 cent increase on a $130 is

actually a pretty large move. It is a

very large move in terms of percentage.

Okay, so that's the benefits of a call

option is when the stock can move a

little bit, the option can move a lot.

And that is why a lot of option traders

really like call options. That's also

why a lot of beginner option traders

look at buying call options because it's

one of the easier ways to make a bet if

you have a certain view, right? So, if

you have a certain view on a stock going

up and you don't have all the capital

for it, well, a call option lets you use

less money, less capital upfront to

still control 100 shares. That is one of

the biggest benefits of a call option.

So, if you wonder why are options so

good and how investors make a lot of

money from them, well, it's really by

having a strong view on a stock and then

buying a call option and basically

betting that, hey, this stock will go

up. The call option that you buy is

essentially a leveraged bet because if

you think about it, if you had to buy

American Airlines in this example, you'd

have to pay $1,700 to buy 100 shares.

But in terms of premium, it's only 130

bucks. I mean, that is a lot lot cheaper

in terms of upfront capital that you

have to put up to control the same

amount of shares. That's exactly pretty

much what a call option is. Now, I want

to move into another strategy because

the next strategy is essentially a

passive income strategy. This passive

income strategy is one that I have used

in my portfolio for the past 10 years.

And this is an idea of being able to buy

stocks below their current market price

and collect a premium for it. This is

going to be a very different strategy.

So, I'm going to um exit out of this buy

call option. I'm going to go to sell put

option. Now, when I am looking at

selling a put option, this is very

different. So, remember, if you are

buying a put option, you're betting on a

stock going down. If you're selling a

put option, you are betting on it not

going down. So look, sell put option. If

I sell this $17 put option, what this

means is if American Airlines goes from

1741 a little bit down, but it stays

above 17, then that's actually okay.

That would still mean that this is an

out ofthe- money option. When I sell a

put option, I'm saying it won't go down

below my strike price that I choose,

right? So if you choose a 17, well, the

stock can slightly go down until 17. And

then at 17 you start to lose money. But

because you collect a premium here, you

can see $122. This is actually a credit.

You are collecting income off of this

trade. So when you sell this put option,

you collect this income. Then your break

even is not really 17. If it goes below

17, you have the risk of getting

assigned early, which typically doesn't

happen. You have a high high risk of

getting assigned at expiration. If it's

below 17, you almost have 100% chance of

risk to get assigned. Now assignment is

not always bad. Many people think that

assignment is bad. However, when you

sell a put option, you can use this as a

dual strategy. You can use this as an

income generating strategy where you are

looking to collect premium. And then

number two, you can use this as a

strategy to enter a stock that you want

to own for a lower price. So the idea of

buying stock below their current price

is this strategy right here, selling put

options. Again, if you sell it upfront,

you collect premium and now you have the

obligation to buy at $17 or lower if it

goes lower. Okay? So, if it goes to

$16.99,

you're in the money now. However, you

still have a gain total because the

premium that you collect is a lot more

than being in the money by, you know,

one penny essentially. So, your break

even here is $15.78.

It's slightly off on Robin Hood. says

76, but the premium if it's 122, you

just do 17 minus $1.22, which is going

to be $15.78.

So that is your break even. And this is

a strategy that I have used for the last

10 years to simply buy stocks that I

want to own. Now, it's very important

that you don't mind owning these stocks

whenever you sell put options.

Otherwise, you are more in that risk

territory where if it does go down, you

may end up losing on the position,

having to close this position because

you don't want to get assigned. But if

you do want to get assigned, then this

is, you know, a pretty good situation to

be in overall. So, here's some more

terminology that you might want to know.

So, call options versus put options. You

can basically buy or sell a call option,

and you can buy or sell a put option.

These are only the four things that you

can do in option trading for the most

part. You can also combine calls and put

options, but that's more of an advanced

strategy. Simply, if you're a beginner

and you want to make a bet on a stock,

you would buy a call option. If you want

to make a bet on a stock going down, you

would buy a put option. If you want to

generate more passive income and sell a

put option and wait until that option

expires, collecting the premium while it

decays, that is a selling put strategy

and that is a more passive income

strategy. I'll show you an example of

another passive income strategy in a

little bit. The most important

terminology that you need to know is

strike price, the price that you agree

to buy or sell the stock at. Premium,

the price that you pay for the option or

the money that you collect if you sell

an option. Expiration date, the date of

the contract when it ends. Then in the

money, the option is profitable or has

value if it is in the money. Out of the

money is when an option is not

profitable yet. But if you're selling an

option and it's out of the money, that

could be a good thing. If you are buying

an option and it's out of the money,

that is not a good thing. So out of the

money is just referring to the price of

the stock not being within the value of

the strike price that you have. So on a

call option, if you buy a $100 call

option and the stock goes above 100,

you're in the money. If it stays below

100, well, you're still out of the

money. And then there's a term called at

the money, which is not that useful. It

just basically means when a stock is

right at the strike price. So now I want

to explain to you my option strategy

here because again, my goal here is not

to gatekeep. I want to give you all the

knowledge that I have in short amount of

time as possible to give you the most

amount of value. So first of all, I look

for stocks with good support levels,

meaning the stock has already dropped or

is holding a price level where I feel

comfortable buying this stock or trading

this stock. That's a really important

point to find support levels where

stocks are cheap. If you trade expensive

stocks, well, it's much harder to make

money when stocks are expensive, and

it's much easier when they're cheap.

Next, I choose options with good

liquidity in a tight bid ask spread so

you don't lose much money whenever

you're trading them. So, let me show you

what bid ask spread is and why it is so

important. If I go to another stock,

which is going to be Nebius, this is an

Neocloud company essentially. It's an AI

revolution story. I have 100 shares

where I made really good money. But I

want to show you if I trade options here

and I go for an option with an

expiration of July 10, for example, and

I go down somewhere and I'm looking at

selling a put and I look at 250, you can

see here that the bid, okay, up here it

says bid $20.95

and ask $22.80.

Okay, so what this is is essentially a

spread difference of someone looking to

buy and someone looking to sell. It's

basically like a market, right? You're

looking at this as a market. So think of

it kind of like gas, okay? Okay, someone

is trying to buy gas at, you know,

$20.95 and someone wants to sell gas at

$22.80. So obviously this buyer and this

seller, they're really not that close.

Okay, so this would be an example of a

illlquid option where the bid ask spread

is wide. Okay, this is a wide bid ass

spread. Not that good because every time

you trade you are losing money here and

this is a very very big difference. You

can also notice here there is a term

here called mark. Okay, so what is mark?

Mark is essentially the middle point

between the bid and the ask. So you see

the mark is $21.88.

This is the middle point where you would

likely get filled on a trade if you were

to enter one. Right? So if you buy or

sell, you're likely to get filled at

$21.88.

You always want to choose options that

have better liquidity. So if I go to

Apple right now, you will see that a

huge mega cap stock that is, you know, a

lot safer, Apple is going to have a very

tight bid ass spread. And simply what

makes a good bid ask spread is when

there's a lot of volume. So if I go

right now to July 10, which is the same

thing I was looking for at on Nebius and

I open up 285, you can see here the bid

ass spread is a lot tighter. So it's

$253 and then the ask is 269. So that's

a much tighter spread here. It's a very

small difference. It's not too small.

It's $16, but essentially you're only

going to be losing half that because

you're going for the midway point

whenever you're filling an option. So,

you're going to lose about $8, which is

a lot better than losing like, you know,

over $100 on the other trade that I

showed you. The next thing is really

just using delta. So, I personally use

delta to estimate assignment risk. So,

here, if I were to sell this Apple put

option, right? Let's say that I wanted

to create some passive income. I sold

this Apple put option at 285. Apple is

trading for 291. So up until the

expiration, I don't really need to do

anything. I'm just selling a put option.

Then I'm hands off. I'm just like, hey,

let me wait and just see what happens.

If it goes down a little bit, that's

fine. If it goes into the money, then,

you know, I have to decide, do I want to

get assigned? Do I want to maybe adjust

the position a little bit? Do I want to

close the position? Right? But

essentially, as long as it's above 285,

I don't need to do anything. And my

decision-making process to get into that

trade, right, to begin with, hey, should

I sell this put option? And how much

risk is this? Well, that's delta. So, it

would be 27 delta here, which means

there's a 27% chance of this happening.

And if there's a 27% chance of this

happening, that means that there's a 73%

chance of this not happening. Or in

other words, there's a 73% chance that I

just sell this put option and it just

expires worthless, which is a good

thing. If I'm selling it, I'm collecting

the premium. I want it to expire

worthless. Right? If you're buying

options, you don't want it to expire

worthless because you're paying and then

you hope to get out with more than what

you paid. So, my basic trading strategy

is sell puts for passive income, wait

until expiration, and then either keep

the premium, which I'm going to keep it

anyways, whether it's in the money or

not, and accept the assignment, or don't

accept the assignment, and basically

either adjust it or just close it out.

Now, if assigned shares, I either hold

the stock longterm because now I have

the shares, right? So, in this example

right here, if Apple goes down to 284

and it's 7:10 on expiration date, right,

at 400 p.m. Eastern, well, the stock

market closes and then I'll essentially

be assigned shares. Then I will have 100

shares of this stock. So, at that point,

I'm either going to wait and hold on to

the stock or I could just continue to

generate income, which is the next

passive income strategy. The next

passive income strategy, the second one

is covered calls. A covered call is when

you sell a call option generating income

on a stock that you currently have right

now. So if I get assigned, then I have

100 shares. 100 shares gives me the

ability to sell call options. So what a

call option would look like, let's say

that I got assigned on Apple, right? So

I have Apple shares now and I want to

sell a call option. So I go to sell call

option. I pick an expiration date here,

July 17. If you're watching this in the

future, this is basically just a

tutorial of how you can option trade

yourself and learn from someone who's

been doing it for over 10 years. So, you

know, feel free to just do this in the

future knowing this knowledge now. So,

look, if I have 100 shares, I can now

sell a call option. So, I can sell a

295, which would be an out of the money

option. It's more expensive than the

current value of Apple, which is 291.

So, at 295, I sell that, right? And now

I can collect $650 worth of premium. So,

if I go into this option right here, you

can see the bid ask is really good. And

the delta here is 48%. So there's a 50%

chance, a little bit higher than 50%

chance that nothing happens. I just

collect the premium and it expires

worthless. Now there's a kind of 48%

chance that the option goes in the

money. And that's not a bad thing

because when you sell a call option, you

are essentially giving the rights to

someone else to buy the stock from you

at that price, right? So if you have an

average cost at 290 and you sell a

covered call at 295 and you generate

premium income, okay, and it goes above

295 and you have to get rid of it, was

that a bad thing? Well, I would say no.

I would say it's not a bad thing because

if you bought at 290, you sold it at

295, you have profit of $5 plus not to

mention the premium. So the premium here

is going to be $6.50. So in total in

this example, if you have Apple at 290

and if it goes to 295, you get $500

worth of capital appreciating, right?

How much money you make off of the

capital appreciating and then the

premium is still yours. So 500 plus 650

you have 1150 in total kind of profit on

this trade example on Apple that expires

on July 17th right so you can also do

you know something more shorter term a

lot of people like weekly options so

weekly option would be something that

expires within one week right so if it's

July 1st you go for July you know 7th

for example you can go shorter term

weekly options generate premium more

frequently but require more active

management so while monthly options are

more passive and I personally love

monthly options because it's it's a very

passive income stream that I have made

for myself by just selling a you know a

call option or selling a put option.

This is exactly what I teach in my

community. I pick a high quality company

that's very important and then I sell

options on those positions. Now higher

returns are possible when you buy

options. Higher returns are possible

because you're spending money. you're

putting up a little bit amount of money

and then if the right direction happens

on the stock then that option could

increase a lot in value versus when you

sell options you have a very fixed kind

of return you have fixed income in in in

a in a way because if you sell something

like this Apple option here for you know

$650 so if you sell this you know

short-term Apple call option for $295

you know basically that's $325 that's

that's that's it you can't make more

when you sell an option you can't make

more than the premium that you sold it

for right that's what you sold it for.

That's your kind of max gain. Whereas,

when you buy an option, well, there

really isn't such a thing as a max gain

on a call option because, you know,

technically speaking, the stock could

continue to rise. And if it continues to

rise, the call option would continue to

gain value as long as the call option

hasn't expired yet. So, you want to make

sure to not only focus on premium, focus

on whether you're comfortable owning the

stock if the trade goes against you. If

you are selling options, right? If

you're selling options, the most

important thing is you like the stock

and you don't mind getting assigned.

Now, if you're buying options, make sure

that you're comfortable spending the

money on premium because the money that

you spend, you can lose 100% of that.

Whatever you spend on the option that

you buy, it can go down completely and

you could end up losing. So, it can be

really risky and you can also lose a lot

of money if you're just buying a ton of

call options or you're buying a ton of

put options. So, if I wanted to lower

the risk, I would pay very close

attention to position sizing. Okay, so

let me show you kind of a little bit

about my portfolio. You can get some

kind of pointers here on what I've been

doing. You know, I've been scaling my

portfolio for 12 years now and I worked

at Goldman Sachs and I kind of made it

my dream and my mission to really

understand how to trade options and have

more freedom. I really hated working at

9 to5 jobs. So, this is kind of my

passion. This is what I love and I'm

very talented at teaching this as well.

So, I want to kind of show you here kind

of my thought process on position sizing

because position sizing is incredibly

important. No matter how experienced I

really am, it's not like I can predict

the future. I make mistakes as well.

Stocks go down and they can be very,

very unpredictable. So, what I like to

do is I like to just, you know, get into

positions that I like, but typically I'm

only putting in, you know, 3 to 5% per

position. For example, even if I really

love a stock, like I love, you know,

several of these stocks. I'll kind of

show you what I do with Nvidia. So, I

love Nvidia. Nvidia is a leader in AI.

So, I personally allow myself to go up

to 10% of my portfolio in Nvidia. But

you can see here I'm selling a lot of

put options because I personally love

passive income. I like selling put

options where I can generate passive

income. Then you can also see I have

plenty of covered calls. A covered call

is basically when you sell a call, it's

called a covered call because you have

the shares, you know, behind it. So you

are covered, right? So I have I ran sell

puts, I have American Airlines, I have

Shopify, I have Nvidia, Chipotle, SoFi,

Robin Hood has been doing pretty well

for me recently. And then Google I have

a pretty large position here. I'm going

pretty heavy on Google, so I'm kind of

breaking my position sizing rules, but

again, this is more of a beginner video.

When you become more advanced, sometimes

you might be okay taking on more risk on

a certain position when you have a high

conviction play. So, I have lots of

different high conviction plays that I

like to personally make. And by the way,

if you want to be part of my high

conviction plays, you can visit the link

in the description. I basically show

everything that I do within my coaching

program, everything I'm buying and

everything I'm selling. But how do you

know if a stock is not going to go down?

And that's by using some simple things

called technical analysis. Technical

analysis can make or break your trading

success. It can make you either very

profitable or it can make you a loser.

in option trading or any type of trading

really. So technical analysis is simply

just analyzing the price movement of a

stock using multiple tools that I'm

about to cover and show you real

examples of. So many great option

traders I've worked with many of them

have used technical analysis to a great

extent including myself. I use technical

analysis to accurately predict where the

stock price of a stock is going to go.

Now this isn't perfect. Nobody really

knows where a stock is going. In fact,

there's a famous book out there called

Random Walk Down Wall Street, which

discusses stocks being completely random

and not having any clear direction where

they're going. Now, that book is not

completely correct, but it's also not

completely correct to understand or to

say, I know exactly where the stock is

going to go. That's a complete lie and

almost nobody can do that. So, I'm

somewhere in between. I think that

technical analysis is very, very

helpful. Gives you a very good sense of

where a stock is trading at and where a

stock is likely to be in the future.

Now, short-term trading is very

difficult, which is why I personally

prefer monthly income strategies, but

I'm going to show you all the strategies

that I know around technical analysis,

and I've said this many times on my

channel before. My favorite three

technical analysis tools are RSI, moving

average, and Bowlinger band. The first

one that I'm going to teach you is

called moving average. All right. Now, I

want to go over the basics of Amazon

stock and the technical analysis. So, I

want to show you how to spot when a

stock is undervalued, how to draw some

trend lines, and how to analyze it on a

technical basis to decide if a stock is

cheap or not, and where you may want to

get in or what option strategy you may

want to use. So, here we have Amazon

stock, and I'm going to get rid of any

comparisons. I'm going to show you from

scratch just basically the price action,

nothing else for now. So, we can

actually see that Amazon has had a huge

rise. Now, a huge rise can happen due to

earnings or any event or any news. And

let's go to the last six months here.

You can see how the stock had a strong

bottom at right around $200 per share.

That's very common, by the way, in the

stock market that a stock can bottom out

at an exact even price. And it's because

the value of a stock is often

psychological. So here we can see there

is a double bottom, a very strong double

bottom pattern on Amazon at $200 per

share. The stock ended up bouncing twice

from this $200 level. So this would be I

would say even beyond support. This

would be pretty much the cement base.

Okay, this is the cement base. I'm going

to be drawing here multiple different

trend lines. So first of all, we're

going to draw the cement base. Now from

a longer term perspective, the stock has

gone from this level here, okay, right

around here to this new support right

here. So there's a new support at around

$227 per share. So as we can see, Amazon

stock is in a pretty good run. actually

a very strong run, but the bottom has

actually formed another pattern. It's so

interesting how a stock will form

multiple different patterns that are

actually pretty obvious to look at. So,

there was a strong double bottom here

and now we have a new double bottom.

This is our new cement base, I'll call

it 226. Okay, and we can see here that

Amazon has went from a bottom of 200 to

226. Now, it's also pretty interesting

because it had a double top pattern

here. Okay. So if I draw a line, we see

here that our resistance is 274. Okay.

So 274 roughly 274. Again, very

interesting because over the last 6

months, Amazon has been in a pretty wide

range, but again on the technical basis

when you draw the lines, you can see

that it's likely to continue to trade

within this range. Okay. So my value for

Amazon is 270 and it looks like it has

increased actually above what the

technical analysis is showing for the

last 6 months. Now I'm going to show you

some more technical analysis that is

more forward-looking potentially because

when we look at the history here for

Amazon, it's not looking too good in

terms of where the price is at right

now. So in terms of an option strategy

that I would use, I would use something

like a call spread, a call credit spread

to be specific, which we'll discuss

later on. could be potentially even

hedging on the downside or even betting

on the stock kind of retracing. Let me

show you actually another indicator that

you should be looking at. So, I'm going

to add here indicators and I want to go

to moving average. Okay, so let's add

the moving average here. And the 50-day

moving average is fine. So, for me, I

like the 50-day moving average as a

default. Other investors are also using

the 50-day. That's why it is a default

setting here on Yahoo Finance is because

the 50-day moving average is very

common. Now, the moving average tells me

two things. It tells me basically where

is a stock trading in relation to its

average of the last period, right? So,

here it's 50 days. So, the 50-day

average for Amazon is 247. Okay? So,

that's telling me that on average for

the last 50 days, Amazon is $247 per

share. And now we're sitting well above

that. So, that could also be an

indicator that we're a little bit more

expensive than the average last 50 days.

So, I'm not really getting the best deal

here. Now, you don't have to do 50-day.

I do like 50-day a lot, but you can also

play around here. You can change the

amount of time. Some people like 30-day,

they like to have a shorter return

window, and others like to even go for

something like 90 days. Okay, so if I go

for 90 days here, okay, I'm going to go

for 90. And essentially here, you'll see

that the line here is much more smooth.

Okay, it hasn't changed drastically. It

went from 247 to 250. And it just shows

you how a moving average really does

smooth out the average price because it

takes into account the different prices

that the stock closed at for the last

period here. Again, it's 90 days instead

of 50. We had 50 before, but with 90,

it's actually pretty similar. It's a

little bit more smooth, though. So, it's

it's more smooth here at 250. And again,

this tells you on average what the stock

has been trading at. So, 250 would seem

like a more reasonable price level for

Amazon's huge increase here, though.

Could be warranted, right? if they had

good earnings or they had a good event

that could be very much warranted for

them to go up and oftent times it is

those earnings that come in and surprise

investors and what causes the stock to

go up, right? But if this would happen

for no reason and was not earnings, then

then that would be kind of a fishy sign

that hey, maybe the stock is up for no

good reason and then that would be even

more compelling to be bearish on it. Now

on a long-term basis though I'm not

bearish on Amazon because when we zoom

out and we go to one year we can see

here that the stock has been trading

sideways here got crushed there was a

period of time where the stock market

entirely was not doing so super well

Amazon being part of that whole group of

stocks and now Amazon very volatile

actually surprisingly very volatile for

a MAG 7 stock when I look at the

technical analysis first of all I like

to get a bird's eye view and understand

what does the chart even look like okay

before I put any indicators before I

draw any lines before I even do moving

average. What does this visually look

like? Okay, now we are we have plotted

the moving average here. We see that the

moving average has actually been pretty

stable for the most part. Right now, I

want to add another indicator here. Let

me just clear the drawings real fast. We

no longer need the drawings. I want to

show you now the moving average, which

we just went over. I want to show you

the RSI. Okay, so let me go into

indicators here. I'm going to go for

RSI. Now the RSI is really interesting

and the RSI is actually very useful for

understanding investor behavior as well.

So RSI will basically tell you how hot a

stock is or how cold it is based off of

momentum factors. Okay, so we can see

here, let me actually get rid of Corell.

We don't need that for this video. But

you can see RSI here. It says

parenthesis 14. So when we see 14, that

means for the last 14 days. Again, I use

a default setting. You can go higher or

lower. And there's different advantages.

It's trying to show you a story. Okay, I

like the 14-day story. It gives me a

nice two-eek view. And then whenever I'm

doing my option trading, which is

typically on a monthly basis, I pretty

much can see for the next two weeks or

the past two weeks what I think the

stock can do in terms of how hot it is

in terms of overbought or oversold.

Okay, if it's around 20 or even around

30, that basically means that it's

oversold. Okay, we can see here how when

Amazon was coming all the way down to

around $200 per share that it was

essentially in the oversold territory.

It was at 24 RSI. Okay, so it's becoming

very very cheap. Okay, and then here

when it was reaching its kind of peak

here and the resistance level, we can

see that it was actually at 8180. So it

was overbought. Okay, so we can see that

RSI is very helpful telling us what the

investor sentiment and momentum is based

off of volume and purchases. So here

again at you know around 30 or below

it's oversold. So that should be very

interesting to you terms of bullish

strategies and then when it gets

expensive it should be a warning sign to

you to not get into the stock or to bet

against the stock to be bearish on the

stock. Okay. So we can see here with

this huge rise the stock essentially

went from you know neutral territory 37

which is slightly oversold to kind of in

this higher range of 70. So again, this

tells me that, you know, a big event

occurred, likely earnings, and now that

Amazon is a lot higher. It's trading for

64 on the RSI. So it's not super

expensive by no means, but it's

definitely not cheap at this level. So

if I was considering a strategy to get

into Amazon and I like the stock, which

I do long-term, I would not want to buy

it at these levels. I would instead want

to look for a better entry and that

would probably be something like selling

put options. Okay. Now to pick the

strike price and to sell a put option,

I'm going to be using the bowlinger

band. Okay, so let me add indicator here

and let me use the bowlinger band. Okay,

so now I'm going to add the default

setting again for bowlinger band, which

here will be a period of 20 days.

Standard deviation will be two. Okay,

let me zoom in here a little bit. We're

going to look at the three months here

in terms of uh looking at the stock a

little bit closer. And I want to explain

to you kind of what Ballinger band uh

looks like and the purposes of it

because I love the Bowlinger band. I

think it's incredibly descriptive. So

the Bowlinger band, you can actually

think of it pretty much like a

statistical curve. It's based off of

statistics. One standard deviation is

68% and two standard deviations is 95%.

Okay, so what this tells me is right now

we're using two standard deviations. So

we have a 95% capture essentially or

visually you can see it's capturing 95%

of what should happen to the stock based

off of volatility and statistics. You

can think about it very similar to human

height. So if you're a man, you're 5'

10, you have a son, he's going to be 5'

10, that would be a zero standard

deviation. You would assume your son

would be about the same height as you.

Now if your son instead of 5' 10 is 6'1,

maybe that's one standard deviation

away. So now you'd be, you know, in the

68th percentile. He would be on a little

bit to the higher end. Your son would be

a little bit taller than you. That would

be a little bit unusual, but not that

unusual. Now, if your son is 6'4, okay,

that might be at the two standard

deviation of likeliness, right? So not

likely. Okay, 95% of the time that would

not happen. 5% of the time it would

happen. Your son would land here where

the 5% is, hey, that happened. He ended

up being super tall compared to your

genetics, right? So that standard of

deviation, it tells you how likely an

event is to occur in relation to what's

normal and what's average. Okay, with

human height, we know that a few inches

taller is already kind of, you know, a

little bit unusual and then 6 in tall

would be very unusual and then a whole

foot taller would be very, very, very,

very unlikely. Possible, but very

unlikely. Here the same thing is

occurring. We're looking at the

bowlinger bands and essentially the

bullinger band here is 95%. So again

it'd be equivalent to your son being 6'4

if you're 5 foot 10. Okay. So it's not

usual that the stock falls outside of

the bowlinger band. Now again we had a

big event here in Amazon skyrocketed

went above but then it again fell within

the Ballinger band. However you'll also

notice that the Ballinger band expands

given volatility. So when there's more

volatility the Ballinger band is

expanding. And I just wanted to show you

guys that Amazon did report earnings on

July 30th, which was a 20%

year-over-year increase. So again, I I

already knew that approximately this

event was from earnings because many

stocks are reporting earnings right now.

It's like earning season. So Amazon

reported above average and above

expectations and that's why it went up

and the increased volatility here also

increased the size of the Bolinger band.

That's why the Ballinger band here is

increasing. But over the one year,

you'll see here that the Ballinger band

actually captures Amazon or or any

stock's performance very very close to

within its range. Okay? So sometimes it

ends up being above the Ballinger band

in terms of a huge massive, you know,

rise. But even as you can see here,

whenever the stock rises above the

Ballinger band, it kind of tells you

that, hey, this is a little bit

overbought and then it ends up coming

back down to within the Ballinger band,

right? Again, here it went above the

Ballinger band for a small period and

then again it comes crashing down. And

here this was an overreaction and we can

see here it went outside the bowlinger

band pretty significantly and again you

kind of come back up. So the bowlinger

band tells you kind of like a gravity.

Okay. So when a stock goes up too much

the bowlinger band is telling you that

likely the stock will come back down to

reality. So the stock market trades

based off of cash flow and fundamentals

more so than technicals in the long

term. In the short term it trades more

on the technicals. We're about to get

into the fundamentals and I'll help you

understand the fundamentals. But to

finish things off with the technicals

here, the technicals are incredibly

important because it can tell you in the

short term what the stock may do.

Whether that's RSI, the stock is

overbought or oversold, whether it's the

bowlinger band, and if you're falling

outside of the bowlinger band, likely

you are to mean revert. Mean revert

means come back to baseline. Kind of

like, you know, I'm 85 kilos and if I

were to diet it down a lot to let's say

79 kilos and my body would not be

comfortable there, it would revert back

to the mean, back to whatever my

baseline weight should be, right?

unhealthy weight for me or you see what

I mean by mean revert. Mean revert just

means come back to the central tendency

right so mean reverting here would be

back to you know around here we can see

that the stock went from 254 to 274 but

that was from earnings and earnings is

indeed a very interesting and different

time period. So earnings affect stocks

tremendously and on this channel I

talked about Palunteer many times and in

my community I have given Palunteer as a

as a play. ended up doing extremely well

and a lot of that was from earnings. So,

this ended up ch like literally changing

investors lives. I actually caught it a

little bit before I ended up doing at

109 right here. I ended up catching it

at a very very good time. I made a video

at 109 and I had run several strategies

which you'll you know learn about later

on. I did a leap. I did a poor man's

covered call and I bought call options

as well in my uh challenge which I run

from a quarterly basis. We ended up

killing it. really did well here and a

lot of this was well first of all

Palanteer was undervalued and then

earnings came in and now the stock's at

a whole different price. You can see

just how much of a difference it makes

to catch trends and catch opportunities

at the right time. I had plenty of

investors that ended up doing like 100K

here and now they're sitting at almost

closer to 200 especially when you factor

in the options that are leveraged,

right? Options could do um a lot more

than a stock can because it's a

leveraged tool. Okay, it's like a

double-edged sword. when the stock goes

up and you're bullish, you can end up

doing multiple times and then when the

stock is, you know, not doing too well,

you can end up losing money. So, you

have to be very careful with how you

trade options. But options can be

extremely lucrative and something like

Palanteer here, when you look at the

trend and you catch the technical

analysis correctly, the bowlinger band,

all the stuff that I just taught you,

you could do extremely well. All right,

so now I'm going to teach you some

metrics that you need to pay attention

to when looking at what option contracts

to buy or sell. All of these things that

I'm about to teach you are going to be

extremely useful when you're analyzing

how safe an option is. The first thing

that I want to talk about is called

implied volatility. Implied volatility

is usually expressed as an annual

percentage. And what percentage reflects

the magnitude of how much a stock is

expected to change in either direction

for that given year up or down. And

people get confused over this term

because it can look confusing, but it's

actually very simple. We know that

volatility means how much a stock price

moves up and down. If it moves up and

down a lot, that means that it has high

implied volatility. If it doesn't move a

lot, then it has low implied volatility.

So ask yourself, do you think Coke has

high or low implied volatility? Well,

the answer is Coca-Cola has low

volatility. If you look at something

like a GameStop or AMC when things were

going crazy and parabolic during those

times, those were high volatility

stocks. Implied volatility just refers

to how volatile we expect a specific

stock to be. And to measure that, every

stock is assigned an implied volatility

percentage. This can get really over

complicated. And all you really need to

know is that anything above 50 is a high

implied volatility generally speaking.

And anything close to 100 is extremely

high implied volatility. Meaning the

stock is expected to shoot up or down a

lot. Typically stocks with extremely

high volatility. These may be

biotechnology companies that have some

big events coming. This may be really

hype meme stocks that have some news

coming. This might be stocks that have

had a short squeeze of some sort. So,

for example, if you remember what

happened to GameStop back in 2021, it

had a really high implied volatility

right before the stock skyrocketed and

then it plummeted back down. So, how

does this apply to option trading? Well,

stocks with higher implied volatility

are going to have higher premium. So

even if there are two different stocks

at the same exact price, the premiums on

them could be very very different. And

if one is expected to be more volatile,

the premium on the more volatile stock

will have more premium. Implied

volatility is also very interesting

because when you're screening for stocks

and you're looking for good stocks to

buy, so for example, I do use a software

called OptionsFi. When I'm using a

software like OptionsFi, they're

screening for high implied volatility

stocks. The reason why I like high

implied volatility stocks is because I'm

typically an option seller. So when I'm

looking to sell options, I do want

higher premiums. If I'm looking to buy

options, then I want lower premiums. The

next thing I want to talk about is the

Greeks. So the Greeks are very

important. It sounds a little bit

confusing, but the Greeks basically

explain how an option behaves. Okay, so

if you have no strategy when going into

an option trade or you do very little

analysis and and wonder to yourself,

well, how would I lose money here? What

if the stock goes up by $1? How much

will the option change? The Greeks

actually explain this. So the Greeks in

option trading consists of really five

of them. You don't need to know all

five. I'm going to go over them very

briefly, but the first one is the most

important one, which is delta. Okay, so

delta actually explains a couple things.

Okay, first of all, if you look at

delta, it explains the chances the

option will be in the money. So, if you

look at an at the money option, let's

say a stock is at 100, you look at a

$100 covered call or a $100 put, it's

going to be 50 delta because there's a

50-50 chance that the stock is going to

be about the same price as it is right

now. If you go for an out-of-the-oney

option, okay, it's always going to have

lower delta cuz it's lower chance than

50%. It's going to have a lower delta.

We use the five Greeks basically to help

measure and predict the price movement

of an option premium. Now, as I screen

record my phone really quickly, you can

see on Robin Hood that we're going to

look at some of these Greeks and we're

going to go over them and uh what they

mean and how to actually use them. All

right, let's go into Microsoft. I want

to show you what selling a put looks

like, why I want to do it right now, the

Greeks around it, and everything else in

between. So, Microsoft has had earnings

which also performed extremely well,

just like many stocks are performing

well this earning season. And Microsoft

is up a very good amount. And I think

Microsoft will probably cross $500 per

share. This is another stock which I

told my community about that I think

Microsoft's at 500. People thought I was

crazy right here when I was saying it's

a $500 stock. I think that can happen

within 6 months. And all of a sudden,

you see how one big event can literally

change everything, changes the whole

valuation of a company, right? So a lot

of people are doing bad right now

because AI stocks are super volatile.

Yet some of the more boring names, some

of the more traditional MAG7 stocks,

absolutely game changers. Just

completely life-changing money and

generational opportunity here. When a

stock goes up this much by $100, that's

just, I mean, speaks for itself. Now,

let's say the stock already went up and

now you're considering to get in, right?

though. Let's look at selling a put

option because selling a put option

almost all the time, especially if

you're looking to hold the stock on a

long-term basis, it would be more

advantageous to sell a put option

because when you sell a put option, you

know, you straight up get a better

price. I mean, what would you rather do?

Buy Microsoft at $4.99 or basically look

at it from a sell put perspective and

sell a put option and potentially buy

the stock for lower or potentially just

get paid not to buy the stock, right?

So, let's open up a put option here. I'm

going to expand the 480. I just want you

to understand what these Greeks mean.

Okay? So, when I look at selling a put,

I pick September 18, which is roughly 30

days out from right now. And I like

monthly options. Now, when I look at the

Greeks and how I want to understand the

Greeks really, you're looking at the

delta, gamma, theta, vega, and row.

Okay. Now, vega, it stands for

volatility. So, one thing that's

interesting is a stock could stay the

same yet the options price could

increase. Okay? So if you're you know

say you bought a call option here

Microsoft could stand still the stock

could do nothing yet the option can

become a lot more valuable and the

reason it can become valuable is because

of volatility. So if volatility

increases in the market then for each

one point increase in volatility this

option would gain 57 right which is a

pretty significant move considering if

volatility increased by 5% or or so then

this option would have $2.50 50 cents

more in value. And given it's only worth

$10, then going from 10 to 12 a.5 is a

very huge change. It's a very huge

change in price from really nothing even

happening besides expected volatility

going up. So volatility is a really huge

factor. And oftent times when I'm

trading live, I'm looking at historical

volatility and implied volatility

whenever I'm making decisions. So when I

do my live trading in my community, I am

looking at, hey, where's the stock? How

has it been trading for the past, you

know, 90 days? is what does the history

look like and then what is the

expectations going forward and when

there is a discrepancy there then I'm

interested in in taking advantage of

that discrepancy and essentially

arbitrageing that opportunity now vega

here is important but really what you

should focus on as an investor don't

focus on row because row here is just

interest rates the interest rates don't

change much theta is important if you're

an option seller if you sell a put

option theta is how much this option

decays in value on an everyday basis so

this option actually It's decaying

fairly fast. 02 theta is essentially

think about as you know each option is

100 shares. So this is 20 bucks. So $20

is the amount that this option is losing

per day. And actually if you sold this

put option $20 is the amount that you're

gaining per day in this example. So $20

in theta* deck is actually your expected

value daily from having sold this put

option. So if you decide not to hold

until expiration on average, all things

being equal, if the stock stays the

same, volatility does not increase,

interest rates don't change, which they

rarely do, then every single day this

option, you would gain $20 as the person

that had sold it. Okay? So in a week,

you know, would be $140 and anytime you

won, you can cut and take profit here.

Okay? But the most important is really

delta. Delta tells you everything you

really need, especially if you're a

beginner. You don't have to be an expert

at any other stuff like gamma. Gamma

measures how much delta changes. But

again, if you look at delta, it tells

you pretty much the entire story. Okay?

So, if I sell a put option on Microsoft

at 480, 30 delta is telling me that

there's a 30% chance that Microsoft will

be at 480 or below. Now, 30% chance I

mean that means overwhelmingly 70%

chance that it does not go there. So

that means seven out of 10 times when

you sell this option really nothing

happens. So you just end up selling it

not getting assigned and $9.90 here the

premium is just yours to keep. Right? So

whenever you sell the option you collect

that premium there's no more obligation

at expiration. You're good to go and you

can do this all over again. Okay. The

delta here is very very important. We'll

talk much more about that as we go on

with this course. So delta is the most

important one. Delta measures how much

the premium price of an option will

change for every dollar the underlying

stock price moves. So for a call option

this can be anywhere from 0 to one and

for a put option this can be anywhere

from 0 to negative 1. Again not a big

deal. Basically think about it as if it

moves up by a dollar then your option

will move up by 50 cents towards the

direction of the option. So if an option

cost $3 and has a delta of 0.5 well if

the stock moves up by $1, then this

option will increase by 50. So it'll be

from $3 to now $3.50. If it moves up by

another dollar, then this will again

move up by 50. Now, like I said, theta

is really interesting because when

you're an option seller, you can

actually take your theta and see how

much money you're making per day. So

let's say that your theta is 10. Well,

then you're making $10 per day on that

option contract being open. So if you

have many option contracts, you have 10

contracts and then your theta is 10,

then you can make $100 per day

consistently just through theta as long

as the stock doesn't have any crazy

moves. And that's exactly how I trade

options is I have a bunch of positions

open. I have maybe 20 positions. Each of

them might, you know, have a theta of 30

to 50 and voila, making well into the

five figures or the multiple five

figures per month in option premium.

When options are closer to the money,

they tend to have much more higher rates

of theta decay because they're right at

the edge of either being valuable or

being completely worthless depending on

the stock's price, the strike price. So,

you know, when options are close to the

money, the theta is going to be higher,

which is kind of fun and kind of cool,

but also more dangerous because the

delta will be higher. And when the delta

is higher, that means there's a higher

chance of you getting assigned. Whether

it's selling a put option, it's closer

to the money or a covered call. It also

is closer to the money. All right, let's

go over fundamental analysis. This is

super important. I rarely do this on

YouTube. It can be a little bit

technical, but bear with me. I'm going

to try to be as simple as possible to

help you understand what I look for when

I do any fundamental analysis. I'm going

to go to the statistics tab here on

Yahoo Finance. And this will tell me

pretty much all the financial numbers

that I need to look at. Right off the

bat, I'll tell you one thing. Whenever

I'm trading options, I don't like

companies under $2 billion. Amazon is

obviously huge, huge company, massive

market cap. It's in the trillions. Um, I

do trade stocks that have, you know, a

little bit smaller market cap for sure.

A h 100red billion is fine. 10 billion

is fine. But when you go too low, like a

company that's $2 billion and lower,

then typically it's it's very very bad

to trade that stock. I'll go overly.

This is a stock that I used to trade a

lot back in the day. I haven't touched

this stock for a very long time, but

I'll show you why it's not good to look

at a company that has a very small

market cap. You can see here that the

market cap is just $429 million. Okay,

so let me go to trade onlyly options and

I'll show you, you know, why this is bad

and dangerous and doesn't really work on

a risk basis or even liquidity basis or

really anything. So if I go to September

here, okay, and let me expand the 13

here, you can see that the bid is 60

cents and the ask is $1.15. Super super

wide. And this gap right here represents

that there's no liquidity. Okay,

nobody's really trading this. The volume

is zero. No one traded this. Open

interest is 80. Very very low. the

implied volatility is very high, but uh

if you're looking to trade something

that's very small cap like Oley for

example, not really my favorite because

um when the market cap is so small,

there's very low volume. Okay, it's

typically not very popular as a stock. I

would not do any spreads on this,

especially because a spread is two

option legs. I really wouldn't do any

options on a small cap stock like this.

So instead, I'd be looking for a company

that at least has uh over $2 billion

market cap. And a lot of my steady gains

right now having a pretty, you know, low

month. I would say $ 1.7 uh% for me.

70K, it's a lot, but this is a lower

month for me. Ended up having one losing

trade. And I'll be honest, sometimes I

have losing trades. I'm never perfect.

And sometimes I make even some silly

mistakes myself. But overall when I look

at technical analysis and fundamental

analysis and I put it together tends to

do really well and it helps me when I

focus on real statistics real valuation

and not hype and sometimes I see stocks

that I'm very excited about. One stock

I'm kind of interested right now COVID

I've been looking into it some of the

more volatile names but really at the

end of the day when you look at

something like an Amazon and you analyze

it properly you understand the value of

the company you could do extremely well

with options. So, let me show you kind

of what I look for when it comes to

fundamentals. Market cap we just talked

about. Really, the next thing is PE.

Okay, there's two different pees.

There's a trailing PE and a forward PE.

Okay, so a trailing PE is basically, you

know, what is the price to earnings

ratio right now on the last 12 months,

right? So, it it takes into account the

price and then divides it by earnings.

Okay, think about it like real estate.

If your property costs $100,000 and you

make $10,000 a year in rent, that's a 10

PE. The price of $100,000 divided

by$10,000 of earnings is 10 PE, right?

If that property was more expensive, if

it was $200,000, but you still cash flow

the same of $10,000, that would be a 20

PE. So, you can see how a higher PE

ratio is worse because a higher PE ratio

means that you're paying more for the

earnings that you're getting. Okay? So

the higher PE, the worse it is. Okay.

Now, forward PE typically goes down. For

Amazon here, it's actually going up,

which could be a glitch here on on Yahoo

Finance, but most likely what it is is

that earnings expectations for next year

are actually slightly lower for Amazon.

Okay, now that's pretty rare. I

typically don't see that. And we'll do

another quick example after Amazon, but

this Ford PE ratio should be going down.

You ideally want it going down. Okay.

And we can switch to balance here in

just a moment, but I'll go through some

more what this means. Okay, the PEG

ratio is essentially price to earnings

divided by growth. Okay, it factors in

growth. And this number 1.46 is actually

pretty good and it's it's been coming

down. That means the price that you're

paying for the growth that you're

experiencing is very good. It's very

balanced here. The lower it is, the

better. Now, price to sales is very low

for Amazon. It is incredibly low. And

the reason why it is so low is because

Amazon has a lot of sales. They're not

necessarily profiting a lot from their

sales, although their profit margin

increased. We can see here their

operating margin is 13.69%.

Which is actually excellent given that

Amazon historically was much lower. It

was 4%, 3%, and that's because all they

were doing was e-commerce. And now

Amazon is making a lot of money from AWS

cloud and other more softwarelike

revenue. and it has improved their uh

operating margins significantly now that

they're not focusing as much. They still

are, of course, but they're not only

making money from just e-commerce. They

have many profit engines within their

business. So, you want to see margin

going up and a healthy margin depends on

the industry. Okay? So, for a retailer

like Costco, for Walmart, for Amazon, it

can be very low. And then when we look

at something like a uh let's go to

something like a data dog, okay? Or any

any software company. Let me go to

another software company. Of course,

Nvidia would be the easiest one of all.

If I showed you Nvidia, it's going to be

the highest profit margin. So yeah,

let's go to Nvidia. This one I know 100%

I know that it has the highest profit

margin of anything out there. 65%.

Absolutely insane. Nvidia has like the

best business ever. That's why it's the

most valuable company. Not only are they

making crazy money, but it's not like

e-commerce like Amazon. And it it's

crazy money on high margin, high profit

margin, 65% here. So we can see just how

crazy that is in terms of helping them

have such a big valuation in market cap.

The PE ratio here is more normal than

Amazon. It's going down. Okay. So this

is an expectation that Nvidia's earnings

will be increasing. So as they increase

in the forward PE ratio saying in the

next 12 months, not in the past, in the

next 12 months, what are we expecting

here? And 25 means that you are getting

a better price. So it'll be cheaper in

the future because they will have more

earnings. The PEG ratio is amazing here.

It's you can make an argument that

Nvidia is so much better than Amazon

based on the valuation here. The PEG

ratio under one. Great. You can see here

how the valuation is great in terms of

PEG ratio. The PE ratio in general

trailing and forward is just a little

bit more than Amazon. Not by much. But

look at that price to sales is 21. Okay.

So very very different from Amazon. And

that's because they have such a huge

profit margin that they are valued many

times more than their sales. They

deserve that because they are profiting

so much from it. Okay. Now this is the

revenue. You can see the income

statement. I look at revenue because

that's that's life of the business is

how much are they bringing in in terms

of revenue. That's a very important

figure. Now of course revenue alone is

not the only number because there's a

difference between how much you make and

how much you spend. Okay? It's similar

to any of us, right? So it doesn't

always matter how much money you make.

It depends how much you spend. I've

worked with a lot of doctors as clients.

And doctors sometimes can make good

salaries, $30,000 a month, $35,000 a

month. But after their taxes, after all

the, you know, money that they pay to

the government and they're left with,

say, you know, $18,000, then they have

an expensive wife that spends all their

money or they have lots of liabilities

like cars and um other expensive things

and at the end of the month, they're not

really left with that much money. It's

because they're living above their

means. Okay? You know, that's one case

versus someone who's making $10,000 a

month, but they're living super

frugally. They're living a very frugal

lifestyle and they save, let's say, you

know, half of that. They say 5,000. So,

someone making 10,000 could end up

having more earnings or net earnings

than a doctor making triple their

amount. So, that is what we call uh net

income. Here we see net income and that

all comes down to EPS. So, EPS is one of

the most important figures as well

because that's the net earnings to

shareholders. Okay, so you know we care

about that, right? And we can see here

how quarterly earnings growth can grow

significantly. So for Nvidia, it's grown

200%. So going back to the PE ratio,

when you see a high PE ratio, it doesn't

really matter that much because

Palanteer had a PE ratio of over 100 and

people still think that it's an

expensive stock when it was at $109 per

share. I ended up buying it and I made

over $70,000 on Palunteer and you know

in the last 30 days personally and you

know I can't imagine how much my

community has made in total you know

probably like millions and millions of

dollars because you know I have a couple

hundred people that come onto my

coaching session and they all get to see

what I do. So when we have 200 people

they're executing on balance here that's

probably many tens of millions

potentially. Obviously I don't have that

statistic but the key here is that

earnings can grow very fast and when

earnings grows P ratio can fall down

very fast. P ratio is just one important

metric but when I'm valuing a company

when I'm doing my valuation model before

I trade it before I tell my community

about it I'm trying to understand the

full story. I want to understand the

earnings growth. I want to understand

their cash flow and I also want to

understand kind of what their balance

sheet looks like. So a balance sheet is

pretty much like a snapshot. Okay? So

think about it like you know I told you

about a doctor making 30K or another

person making 10K. Well that's their

earnings. A balance sheet is what they

have on their bank accounts right? So

they have total cash of $53 billion.

They have debt of 12 billion. That's

great. So that is a really good ratio.

Yeah it's a very nice ratio because they

have a lot more cash and they can cover

their debt. So there's should be any

tough times. They should be able to

weather that storm if they need to.

Right now I also do look at short

interest. If it's high then avoid that

stock. You don't want to be in a stock

that has high short interest. It just

really doesn't make sense. You wouldn't

want to be in that. And you can see here

a lot of other metrics here. Not as

important, but definitely still tells

you the overall health of the company.

All right. So, now we're going to be

talking about the wheel strategy. So, to

do the wheel strategy, you need to know

what a covered call is. You need to know

what a cash secured put is, which I

covered earlier in this course. So, go

back to that if you don't fully

understand them. The will strategy

involves a covered call and a cash

secured put at different times. To start

off the will strategy, all you want to

do is sell a put option. Once you get

assigned, you start selling covered

calls to generate income on the position

that you got assigned. The will strategy

is my very favorite strategy, especially

as you scale your portfolio. So, first

you start by selling a cash secured put.

A cash secured put means that you have

the cash that if that put were to get

assigned, then you have the cash to

purchase that put option if you do get

assigned. So, say that you sell a put

option at the $100 strike of a, you

know, different stock. Let's say it's

Apple. Then, if you get assigned at

$100, that's basically a $10,000

position. You can also sell a, you know,

put option on something cheap like

American Airlines, that would be $1,400

if the strike is 14. So, a covered call

means that you already have the cash set

aside in the account as well. So,

whether it's selling a put option, you

do need to have the cash set aside or a

covered call option, you need to have

100 shares of stock. So, again, this is

a capital intensive strategy. So you

will want to have a stock 100 shares of.

So like that could be Palenter, that

could be anything that you can afford

100 shares of. Or vice versa. If you're

just going to sell a put option to get

into the strategy, then again, you need

to have that cash laying around. If

those are too expensive for you, you do

have to look for the cheaper strategies

that I will cover later on in this

course. The point of the wheel strategy

is that you're never afraid to get

assigned. You are never ever afraid to

get assigned. So if you sell a put

option, you're perfectly happy to get a

signed 100 shares. If you, you know, get

assigned and you have those shares, you

sell a covered call. If the covered call

gets assigned, you lose your shares.

You're also perfectly happy. You're just

generating income on both sides. You're

generating income from puts. You're also

generating income from selling covered

calls. So, you should never be

frustrated or upset. If you sold a put

option, you get assigned. Yes, it can go

very into the money, and that can be

difficult to run the wheel strategy.

But, in like basically 90% of cases,

it'll be very easy to run the wheel. So,

I wouldn't really worry about it,

especially if you're using highquality

companies. Once you've chosen the stock

that you like, now you have to pick a

put contract with a relatively safe

strike price with an expiration date of

30 to 40 days. You can use shorter term

expirations. You can also use longerterm

expirations. I prefer to go for monthly

income. So I will pick an expiration

date that's 30 days out. And also my

sweet spot delta will be about 30 as

well. So after working for Goldman

Sachs, looking at lots of research

reports, what I realized was that

selling put options to run the wheel

strategy is specifically very good in

volatile markets because when volatility

is high, selling options is better. When

the market goes down, you make more

money than an average stock investor

does using the wheel strategy because

selling puts to get into a stock already

gives you that margin of safety as well

as cushion because when you're selling a

30 delta put option or let's say you can

also sell 25 delta, anywhere between 20

and 30 delta is a really good sweet

spot. you'll actually get assigned about

three out of 10 times on a 30 delta. If

you're doing a 20 delta, you'll get

assigned about two out of 10 times.

Obviously, the less out of the money

your strike price is, the higher premium

you're going to collect. But in general,

and especially for beginners, the wheel

strategy is not about getting greedy.

It's about safe, consistent returns. So,

you generally want to pick a strike

price kind of far out of the money. You

can also go under 20 delta. You will get

paid a lot less. If you have a bigger

portfolio, this will favor you. Now, if

you have a smaller portfolio, you may

even decide to go a little bit higher

than 30 delta because you get paid more.

The most important thing isn't how many

dollars it is out of the money, but how

likely it is to go into the money. So,

again, you can go $1 out of the money.

That could be really good for a cheap

stock like American Airlines. That could

also be not that far out of the money

for a more expensive stock like Tesla.

So, it's not necessarily how many

dollars you got out of the money, it's

how far away you go as a percentage

basis. The risk in option trading is

that in the short term you may get

unlucky. But in the long term, if you're

using the strategies that I'm teaching,

you are going to be very successful over

a longer period of time, just like in a

casino. If you were to go to a casino

and you were to make one big bet, it's

actually very scary for the casino

because the casino could lose in the

short term. However, if you go to the

casino and you just keep doing $10 bets

over a thousand times, you are virtually

guaranteed to lose because the casino

has a small edge. So, what I'm teaching

mostly on my channel is actually option

selling because option selling makes you

the casino. You become in the power seat

where you're making consistent income

using the strategies and the techniques

that I'm teaching you because I know

that they work. So, when you sell a put

option, that option is going to decay

every single day. You can buy it back at

any point because there is theta decay.

That option is becoming less valuable.

And because it's becoming less valuable,

that's a really good thing for you

because you're able to buy back that

position for a gain. As long as all

things stay even, that data will be

kicking in. Of course, if that stock

goes down, then your put option may be

at a slight loss, which again is fine.

If you take assignment, you have 100

shares now, and you're in the perfect

seat to do covered calls. Okay, to

explain the expiration date, 30 to 40

days is a pretty normal expiration.

Anything much longer than that, and

we're starting to get into the risky

territory because so much can happen

past 40 days. The thing is, you can sell

puts that are beyond 40 days. This

really depends because if you're picking

a high quality stock, you really don't

mind. So you can do longerterm options

and you will actually get compensated

more. So when you go out that 60 days,

90 days or you know multiple months, the

compensation to you comes faster because

you have to take all that upfront risk

right away. However, I will say that the

most profitable trading is between 1 to

6 weeks. That's because that's when

theta really kicks in. You can see a

chart right now on the screen. theta

really speeds up towards expiration. So,

as expiration approaches, the theta is

becoming more and more. This means that

the option is decaying in value. Again,

if you're an option seller, which is

what the wheel strategy is about, and

this actually benefits you if you're an

option buyer, this is why buying options

is better to go out longer term because

there's a lot more that can happen.

However, I will say that one of my

strategies is to buy shorter term calls,

but that's a more advanced lesson than

this course. anything shorter than 30 or

40 days. And the premium isn't going to

be that good. However, the expiration is

so short. So, you can do that many, many

times. You're going to want to

experiment with this. Again, for me,

it's 1 to 6 weeks, and there's much more

that goes into it. I also like to really

understand the stocks that I'm paying

attention to, and my list of stocks is

only about 25 or 30 stocks. That way, I

can make really good decisions and keep

trading the same stocks over and over

again. So once you find a strike price

with a delta around that range and that

expiration date, it's time to sell the

put option. This is of course the most

fun part where you get to collect your

premium upfront and then as soon as you

collect the payment, you should be

watching your position to see if the

stock price starts getting close to your

strike price. In most cases, it's really

not going to do anything. When you sell

an out-of-the-oney put, most stocks just

typically go sideways because most days

stocks are not really moving that much.

Sure, they might move half a percent,

1%, but if you're selling a three or

four or 5% out of the money put option,

in most cases, you actually don't really

need to do much. You can monitor the

trade every few days, but you do not

have to look at it all the time. In

fact, I have so many students that are

doctors, dentists, lawyers, software

engineers, they're very busy

professionals. They're already making a

high income. So, even when they do make

$10,000 per month doing option trading,

they still have a very busy life. So,

they don't necessarily want to look at

their portfolio. And I always tell them,

that's completely fine. You're not going

to get better results by being obsessive