- The Option Premium
- Authors
- Andrew Crowder
You've Been Doing Covered Calls Wrong. Here's the Smarter Way to Think About Them.
A covered call and a short put at the same strike have identical risk profiles. Same P&L at every price. Same Greeks. The only difference: $15,000 in capital vs. $3,000. The risk equivalence that changes how professionals deploy capital.
The Jade Lizard: How to Sell Premium With No Upside Risk
A jade lizard combines a short put with a bear call spread. When the total credit exceeds the call spread width, upside risk is zero. 20-30% more premium than a cash-secured put with the same downside exposure. Setup, construction, and management.
IV Rank vs. IV Percentile: Why Every Premium Seller Needs Both (and Which One I Trust More)
IV Rank uses 2 data points. IV Percentile uses 252. A single spike can blind IVR for months while IVP stays accurate. Learn the formulas, the spike distortion problem, and how to use both together with real examples.
What Is Beta Weighting? The Tool That Turns a Scattered Options Portfolio Into a Single, Readable Number
Beta weighting translates every position into SPY-equivalent deltas so you can see your total market exposure as a single number. The formula, a 7-position example, portfolio-level Greeks, and why premium sellers need this tool.
Calls and Puts: The Only Two Things You Need to Know First
Every options strategy ever built, from the simplest covered call to the most sophisticated multi-leg position, begins with one of exactly two instruments. Here is what each one is, how each one works, and why understanding both changes the way you see every trade.
Probability of Touch vs. Probability of Expiring ITM: Why Your Short Strike Gets Tested More Often Than You Think
Your platform shows 85% probability of profit. But there's a 30% chance the stock visits your short strike before expiration. Learn the 2:1 rule, how Prob Touch differs from Prob ITM and Prob OTM, and why closing at 50% eliminates remaining touch risk.
How to Build an Options Portfolio That Can Take a Hit
Five pillars that keep premium sellers in the game: position sizing at 2-5%, uncorrelated positions across 8-12 underlyings, a permanent 20-30% cash reserve, strategy diversification, and a written drawdown plan with pre-committed actions at every level.
The Capital Efficiency Hybrid: How LEAPS, Cash-Secured Puts, and Covered Calls Make Every Dollar Work
LEAPS control stock at 30% of the cost, freeing 65-75% of capital to sell cash-secured puts. When assigned, covered calls generate income on shares. A $50,000 hybrid portfolio runs 10+ income streams where a traditional portfolio runs 3.