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How do you choose stocks for wheel strategy?

Asked 06 Sep 2023 12:15:43
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06 Sep 2023 12:15:43 User  posted:
Choosing for the stocks for a wheel strategy involves a systematic approach that balances risk and reward. Firstly, I assess the fundamental strength of a company by looking at factors like revenue growth, earnings stability, and debt levels. I also consider the stock's historical price volatility and liquidity. Next, I check the option chain to ensure there are liquid options available for that stock with strike prices that align with my risk tolerance and profit targets. Additionally, I prefer stocks that I wouldn't mind owning long-term if the options get assigned. Lastly, I evaluate the implied volatility to ensure that selling options on the stock will yield an attractive return. Overall, a combination of fundamental analysis, technical indicators, and option market data guides my stock selection process for the wheel strategy.




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Replied 06 Oct 2023 11:55:45
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Replied 06 Oct 2023 11:56:45
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