CRDO Reddit Mentions | ChartExchange

You had alluded to a lot of volatile stocks . I have a high beta portfolio like ALAB, NBIS, CRDO , BE etc. that have the potential to (and actually do ) swing widely.
Not sure if you sell options, but I use covered calls and CSPs as my trading strategy to get some downside protection. At times it has not been adequate in the first leg of the wheel strategy because the stock kept falling. The calls have to be rolled out in time (or rolled in for a lower max profit) to keep pace with the drop in the stock such that the premium in the next roll was meaningful.
In short, positions had to be actively managed to break even or be profitable before closing the position entirely
I cannot speak about other traders, but I personally hate .to see my stock fall with no strategy to recover my losses in place for an indefinite period of time. Hence the personal choice to sell covered calls on shares I own. The calls cap my gains on the upside, but I am OK with that,
What I have learnt over the years is that it is easy to put on a trade, but critical to know how to manage the trade when things go wrong. My focus is first on capital preservation in a downtrend (Profits are secondary)
I normally sell 30-45 DTEs normally. I roll at around 21 DTE or if the option is already 45-50% in profit (whichever is earlier) .
At 21 DTE, the Greeks start to interact a bit more and move in option prices is a bit more pronounced for every dollar change in stock price. So , if I choose to wait till 7 DTE, then I end up watching the position a bit more closely , but I never go past 7 DTE (close position or roll it out as the case may be) .
If you have access to Kindle Unlimited, you can read in more details on the rules of when and how I initiate the trade management in a downtrend at [amazon.com/dp/B0H7P6CQSG](http://amazon.com/dp/B0H7P6CQSG)
The exception is a trade on very volatile stocks like NBIS, BE etc. Volatile stocks need more active management as below.
If the stock has fallen suddenly, it is possible that I could have 45-50% profit on the option even before 21 DTE. In order to make sure that I am keeping pace with the falling stock, I will roll it out another 30 days, or lower the next strike at the same expiry (which will lower my max profit (if called away - but will reduce my cost basis within the same expiry period and reduce my potential loss) .
if the volatile stock really takes a hit, I will roll to a strike further out in time, so long as the premium is such that it is above my cost basis. If there is a sudden jump up in the stock again, I buy back the call (which increases my cost basis) , but pull the strike back in at an earlier expiry so I can capture the theta decay . You can see this posts below to get a feel for the thought process and probably what you might encounter when you are dealing with a volatile stock in this two series post.
Post 1 : --->
[https://www.reddit.com/r/smallstreetbets/comments/1vcs3g1/babysitting\_nbis\_how\_i\_am\_navigating\_the\_recent/](https://www.reddit.com/r/smallstreetbets/comments/1vcs3g1/babysitting_nbis_how_i_am_navigating_the_recent/)
Post 2 : (Update to post 1 after 2 weeks) :---->
[https://www.reddit.com/r/smallstreetbets/comments/1vp5m9r/babysitting\_nbis\_how\_i\_am\_navigating\_the\_recent/](https://www.reddit.com/r/smallstreetbets/comments/1vp5m9r/babysitting_nbis_how_i_am_navigating_the_recent/)
Hope this helps.
DISCLAIMER - NO Trade Advice/ No Financial Advice. The links here are based on how I trade .

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