Today, I’m breaking down a recent trade on CLS where my puts went in the money for the first time. But here’s the thing—I’ve been collecting premiums on cash-secured puts for months, and that dramatically lowers my actual cost of acquiring shares. I call this the tracked cost discount effect.
By factoring in all the premiums I’ve collected, my effective purchase price is way lower than my assignment price. And when it’s time to sell calls? I don’t need to fixate on getting back to my assignment price—I can focus on maximizing premium and making the wheel strategy work even better.
This is why understanding cost tracking is key to trading smart.
#options #tradingstrategy #cashsecuredputs #investsmart
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