Trading options can be a powerful way to generate consistent income — if done right. In this post, I’ll walk you through my recent trading journey using a short premium strategy , including how I turned a $19,453 unrealized loss into a $12,847 profit by strategically selling options and collecting premiums.
This is not just about numbers — it's about mindset, risk management, and knowing when to let options expire versus closing early.
🔍 The Strategy: Short Premium Selling
I focus on credit strategies , primarily Selling To Open (STO) for calls and puts. This means I collect premium upfront with the hope that the option expires worthless or is closed at a profit later.
Why Short Premium?
- Time decay works in my favor
- High probability of profit if strike prices are well chosen
- Can be used across multiple instruments
- Allows portfolio diversification while managing risk
Here’s a snapshot of the transaction types in my portfolio:
📊 Portfolio Snapshot
💡 Total Premium Collected: $15,703.50
Net Final Profit After Options: $12,847.77
🧠 Key Takeaways from My Trading Journey
1. Options Turned Losing Positions Into Winners
Even though RDDT had a massive unrealized loss of $19,982 , aggressive premium selling helped turn the position into a net profit of $2,913 .
Same goes for GOOG and SMCI , which were underwater but became profitable after collecting premiums.
✅ Lesson: Don’t fear paper losses — they can still become winners with proper options strategy.
2. Time Decay Is Your Best Friend
Most of my profits came from short-dated weekly options. For example:
- NVDA weekly call sales generated over $5,803 in premium
- TSLL weekly put sales brought in $295+ per trade
These trades rely on time decay and low volatility , allowing me to collect premium without needing the stock to move.
✅ Lesson: Focus on high-frequency, low-volatility names like NVDA, SMCI, HOOD, and TSLL.
3. Margin Usage Comes With Costs
I use margin to increase exposure, but it comes with interest charges:
While margin boosts returns, interest costs eat into profits . It’s important to monitor leverage usage.
✅ Lesson: Use margin wisely — keep track of MINT charges and aim to reduce unnecessary borrowing.
4. Expirations Are Not Always Bad
Some of my best trades involved letting options expire worthless . Examples include:
- NVDA 2/14/2025 Call
- HOOD 1/31/2025 Call
- RGTI 1/31/2025 Put
When you sell options, letting them expire OTM is often better than closing early for a small credit.
✅ Lesson: Let winning trades ride until expiration unless there’s a reason to close early.
5. Assignments Happen — Be Ready
A few positions resulted in assignment (OASGN) , meaning I was assigned long shares. For example:
- HOOD 2/28/2025 Put assignment
- TSLL 3/28/2025 Put assignment
This isn’t necessarily bad — being long stock gives you flexibility to sell covered calls or manage risk differently.
✅ Lesson: Have a plan for handling assignments — don’t panic, adapt.
🚀 What’s Next?
I’m planning to:
- Diversify into more stable dividend payers for covered calls
- Reduce margin usage to lower interest drag
- Track performance by sector and time frame
- Start using spreads for defined risk
📌 Final Thoughts
Trading options has allowed me to generate consistent income , even during market downturns. While some positions didn’t go as planned, premium collection and strategic risk management helped turn the tide in my favor.
If you're considering options trading, remember:
- Focus on probability , not prediction
- Collect premium regularly
- Manage margin wisely
- Stay disciplined and stick to your system
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