Account protection: Using Dynamic Hedging to Protect Short Puts

Worried about a crash and having your short puts lose money? Learn this simple and effective technique to reduce downside risk and increase potential profits. Dynamic hedging makes money if the market moves in either direction and can significantly reduce risks in the even of a market crash. In IBRK I show how to reduce risk on a position by short selling shares and simultaneously buying a call while holding a short put. I'll break it down step by step.
💰 Join the discord chat: / drawbridgefinance
📈 Download Spreadsheets: www.drawbridgefinance.ca
💰 All my links: www.linktr.ee/drawbridgefinance
▬ Discount to Seeking Alpha Only $99/annually ▬▬▬▬▬▬▬▬▬
►www.sahg6dtr.com/2RSPJ5/R74QP/
▬ BROKERAGES I USE ▬▬▬▬▬▬▬▬▬
►Interactive Brokers: www.interactivebrokers.com/mk... (Paid Link)
►Wealthsimple Trade for CANADIANS: Get $10 Free when you fund and trade $100 my.wealthsimple.com/app/publi...
▬ CONTENTS ▬▬▬▬▬▬▬▬▬▬
0:00 Intro
0:42 My CVX (Chevron) short put needs protection
2:15 Details of the Trade: Short stock, Long call
2:31 How much does it cost to protect?
4:07 Entering the trade in Interactive Brokers IBKR
5:20 How it changes the risk profile
▬ GREAT FINANCIAL BOOKS ▬▬▬▬▬▬▬▬▬
► Unlucky Investor’s Guide to Options Trading(Pre Order): amzn.to/3ETWQpa
► Think and Grow Rich: amzn.to/2t285sL
► The Wealthy Barber: amzn.to/2sW9XTM
► The Millionaire Next Door: amzn.to/2HB6DTk
► Rich Dad Poor Dad: amzn.to/2y5rD4S
► Getting Started in Options: amzn.to/2LEJzWe
► Smart Couples Finish Rich: amzn.to/2Eu1qgr
► The Automatic Millionaire: amzn.to/2HcC5KU
▬ Trading Computer ▬▬▬▬▬▬▬▬▬
► LG OLED 48” 4k TV/Monitor: amzn.to/31lJPH8
► Samsung 28” 4k Monitors: amzn.to/32QZL4r
► Startech USB - HDMI (3rd Monitor): amzn.to/3EMBiKX
▬ Cameras ▬▬▬▬▬▬▬▬▬
► My New Canon RP: amzn.to/3mQwkqf
► My New Canon 35mm Lens:amzn.to/3mRmg0d
► Canon 80D: amzn.to/2HxdGNL► Canon EF-S 18-135mm: amzn.to/2FhwsXd
► Canon EF 50mm: amzn.to/2UyB5HM
► Canon EF 100mm: amzn.to/2SnOjEG
► Canon EF-S 10-18mm (VLOG Lens): amzn.to/2HuQ6B4
▬ Live Stream Gear: Video ▬▬▬▬▬▬▬▬▬
► Atem Mini Pro: amzn.to/3zRhJjA
► Glide Gear Teleprompter: amzn.to/3FSYnNl
► Elgato Stream Deck XL: amzn.to/3FMYV7t
► Iphone Lightening HDMI Adapter: amzn.to/3qLoVKh
► Joby GorillaPod (Bendy Tripod): amzn.to/3JsQ5xQ
► Manfrotto Tripod with Video Head: amzn.to/3bi67tr
► Andoer GVM GP-80QD Slider: amzn.to/2qZtXUo
▬ Live Stream Gear: Audio ▬▬▬▬▬▬▬▬▬
► Rolls MicSwitch MS111: amzn.to/3sQI7Zv
► RODE VideoMic Pro: amzn.to/2vYqXOn
-- As an Amazon Associate I earn from qualifying purchases --
Subscribe to Drawbridge Finance on CZcams: czcams.com/users/Drawbridgef...
My primary investment strategy is long term high yield dividend investing, index funds and reducing risk and exposure using options. I have been actively trading the stock market for over 25 years and have built most of my wealth by reinvesting my dividends and following my 14 Personal Rules of investing. I actively trade options on both the American and Canadian Stock exchanges using options strategies and buying and holding high yield dividend paying stocks.
I generate monthly income in two ways. Averaging more than an annual 7% return by collecting dividends on high yield dividend stocks that I hold. The second income stream comes from the selling of option premium and taking advantage of theta decay. I love trading strangles, Iron condors and diagonal spread for maximizing returns. Delta neutral strategies allows me to make money in both bull and bear markets and limits my risk. Both of these strategies are suitable for passive income and create a stable predictable safe passive monthly income.
Want to learn how to trade stocks and make more money? This channel is dedicated to increasing investment returns and building wealth by passively trading in the stock market. If you’re tired of poor performance then make sure you subscribe to Drawbridge Finance czcams.com/users/Drawbridgef... I produce weekly videos for the beginner trader and use simple explanations to learn how I buy and sell stocks for profit.
Let’s Get Rich Together
Levi Woods
Disclaimer: I am not a financial planner and am not offering investment advice. This is an opinion channel only and should not be taken as any form of financial advice. I receive a small commission from the purchase of any item from using the links listed above. There are financial risks involved in taking on any monetary transaction that I discuss in my videos.
#investing #stockmarket #optionstrading #LetsGetRichTogether

[@DrawbridgeFinance]

💰 All my links: www.linktr.ee/drawbridgefinance
Join the community to watch my real-time chat: www.patreon.com/drawbridgefinance
Educational investment videos: czcams.com/users/drawbridgefinance

[@billassim9014]

Great info

[@DrawbridgeFinance]

Glad you think so!

[@laurencesmith9306]

Can u do.this on earnings

[@DrawbridgeFinance]

Typically not a smart time to buy long calls because the extrinsic value of the long options drops dramatically over earnings. A very large move would have to happen to offset the cost.

[@jt102]

Nice trade! why 53 short shares?

[@DrawbridgeFinance]

Here is a video on how the dynamic hedge sets up: Dynamic Hedging Options - Make money if the stock moves either direction
czcams.com/video/ARhbsCX8Dt4/video.html

[@1petriq]

Man this is no dynamic hedging at all. You had just done two 2 trades. 😂😂😂