The Modern Stock & Options Trading Show

In the episode, Russ explains what to do now with a Presidential election about 26 days away.   Market indexes are also at or near all-time highs.  What do we do?

Russ covers 5 topics on this episode (or five courses of action) including:

1.) Writing covered calls – at higher (sometimes stretched) prices - OTM (out of money) by 3%-5%.

2.) Selling (or writing) cash backed put options (at a strike price that is 95% of today’s stock price).

3.) Tighten up Stop Loss Orders to 4%-5% down from today’s stock prices. 

4.) Ride out the volatility in diversified long-term ETF’s & 

5.) Go short (by buying long puts) to bet down - the riskiest strategy… but it is a choice.  What Russ discusses what he is doing now. 

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In the episode, Russ explains why the stock market is 50% science and 50% art.  Everyone seems to want to use logic and mathematical formulas to control (or solve) the stock market.  What they don’t realize is that there are millions of individuals all playing in the same place at the same time with different ages, objectives, risk tolerances, etc..  Add in their emotions (of fear and greed) and you quickly realize you can’t reduce the stock market to a predictable outcome or a mathematical formula.   

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In the episode, Russ explains the Box Spread options strategy.  This strategy is another 4 -legged options strategy in that it puts two spread trades together.   It is like the Iron Condor options strategy on the credit spread side, but the Box strategy is two debit spreads put together. 

Russ discusses the type of interest rate environment to use this strategy in and also shows two examples to bring the strategy to life. 

Russ discusses this adjustment / ptotection strategy with markets at all-time highs.   He discusses when and why one may want to adjust and protect their covered call trades. 

If the underlying stock (or ETF) has gained and is strongly above the call strike price written when you are already into a trade, is there anything you can do if you wish to protect your covered call trade? 

The answer is yes and Russ discusses what the adjustment mechanics are and gives an example.    

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Russ discusses how to use a combination of options strategies to simulate the risk & return graph of a stock. 

He also discusses the wrinkle he adds to the core strategy to cut off the downside below a certain percentage. 

He also gives an example. 

You can use this strategy to simulate multiple stocks as well in a portfolio. 

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Episode #91: Reg-T Margin vs. Portfolio Margin

Russ discusses the types of accounts margin is used for, the pros and cons of each and the differences between Regulation-T margin and Portfolio Margin.  The origins of Portfolio Margin are covered and the types of strategies to use this type of leverage on.  Remember margin, of all types, is a loan from the broker-dealer to you based on your assets.   This means margin loans can magnify your winners or magnify your losses.  Be careful... but with careful use of margin you can speed up the growth of your account.    

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Episode #90: Mega ROTH Ira vs. The Backdoor ROTH IRA

Russ discusses the differences between the Mega ROTH IRA and the Backdoor IRA.  Overfunding your workplace retirement plan and funding your Traditional IRA conversion to a backdoor ROTH IRA.  Why you would want to do this and the mechanisms how to do so.  The income limitations for Contribution limits for the workplace retirement plan and the income limits on the ROTH IRA and how to get around them. 

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In the US, the government passed Secure Act 2.0 on December 29th, 2022.  It was the most important and expansive piece of legislation affecting retirement savings since ERISA in the 1970’s.  In this episode, Russ unpacks the key questions he gets from clients and others about: the age increases, contribution limits, RMD changes, 529 (college savings plan changes), automatic wokplace retirement plan participation qequirements, qualified charitable distributions, etc.  This podcast is not designed to be a comprehensive review of Secure Act 2.0, but rather hit a few highlights Russ gets asked the most. 

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To accumulate wealth, you must learn more than "Buy and Hold."  In the is episode of the Modern Stock & Options Trading Show, host Russ Mathews, goes through some key ideas for generating cash flow and how to keep more of what you generate.  He covers: the types of tax preferred accounts to trade in, how to use the leverage of options, concepts of margin and how it can turbo charge your accounts (though it can be a double edge sword), how to get paid in debt etc.  He also covers how conservative options trading concepts can also generate cash flow - writing covered calls, selling cash-backed puts to buy stocks we like at cheaper prices and get paid now, etc. 

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In this episode of the Modern Stock & Option Trading Show, Russ lays out the 8 trends / themes that he is currently focused on.   He covers where we have been and where we are going into 2024.   Context is key to investment performance as we have seen volatility since the summer. 

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