I mentioned before that whoever first deals with RWA US stock options will dominate the RWA track for US stocks, and today it has arrived, produced by #Bitget, definitely a premium product!🧐
Honestly, Bitget's investment in the RWA field is really admirable. From Pre-IPO to US stocks and then to US stock options, I have been following it all along. The speed of innovation and the contributions to the RWA track are greatly commendable 👍. It truly deserves to be the number one UEX platform on the entire internet.
I'm very happy to be able to trade options now; I can sell puts. Either I earn the premium, or I buy good companies at a low price, no matter how you calculate it, it's a win. Simply put, having learned options, we now have another way to make money (of course, if misused, it can lead to significant losses).
Moreover, Bitget has recently been running promotions. Not only is trading options commission-free, but you can also receive a $15 Nvidia stock reward. It’s worth trying with small funds, and I recommend the put-selling strategy of the renowned Duan Yongping!
📝 What is selling a put? And what are the strategies of the expert Duan Yongping?
If you are optimistic about a certain stock but think the price is a bit high right now, and you don't want to chase it, you can sell a put option, agreeing on a lower price (strike price).
• If the stock price continues to rise or stay flat, you just earn the premium for free. Generally, for popular stocks, the premium can yield an annualized cash return of around 10%-18%.
• If the stock price falls below the strike price, you will buy the stock at the agreed price.
This is the so-called "earning money while lying down." You either earn the premium or buy the desired good companies at a discounted price, it’s a good deal no matter how you look at it.
🎯 The iron rules for selling puts by expert Duan Yongping:
Mr. Duan has played options for so many years without a mishap, earning premium income of tens of millions of dollars each year, based on three core principles that we retail investors can also learn:
1️⃣ Only sell put options on good companies that you understand and are willing to hold for the long term.
Mr. Duan mainly sells puts on companies like Apple, Tencent, Pinduoduo, and Pop Mart. The logic is simple: if the price really drops and you are forced to buy, so be it; he would be delighted to buy these good companies at a low price.
If it’s a bad company, and it drops, buying it would be disastrous. Therefore, the first iron rule is: only sell puts on good companies you genuinely want.
2️⃣ Use 100% cash margin, never leverage.
No matter how many puts Mr. Duan sells, he always prepares enough cash in his account to cover the entire purchase. For example, if he sells 225,000 puts for Pop Mart, he freezes tens of billions of Hong Kong dollars in cash in his account.
This way, regardless of how much the market crashes, he will only have the 'happy trouble' of being forced to buy good companies, and will never face the risk of 'liquidation and forced closure.'
This is the key to preserving life!
3️⃣ Buy the underlying stock directly when it's particularly cheap, only sell puts when the price is neither high nor low.
When a company is severely undervalued, you should directly buy the underlying stock because the opportunity to double may be greater. Selling puts might only earn a little money and miss out on significant rises.
Only when the stock price is neither high nor low, slightly mediocre, and you have spare cash in hand, should you sell puts to enhance returns.
🌰 For example, how to play in practice?
If you are optimistic about Tesla, and the current stock price is $400, you think it’s a bit expensive. You can:
• Sell a put option with a strike price of $380, earning a premium of, say, $500.
• If the stock price is above $380 at expiration, you just earn that $500 for free.
• If the stock price falls below $380, you will buy Tesla at $380.
If you originally intended to buy Tesla, it's like buying it at a discount of $380 while also earning an extra $500 in premium.
This is the charm of selling puts.
Finally, a reminder: to experience options trading, you need to update the Bitget APP to the latest version 2.87.0.
If you are a beginner, I recommend starting with a small fund by trying to sell puts to gradually learn. Options can be a powerful tool for making passive income if used correctly, but if misused, it can lead to substantial losses. The key is to understand the underlying logic and not play blindly.👀
DYOR🙏
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