boilermaker75

Thanks for helping clarify GFP. I am a child of depression era parents. It is in my DNA to not be mortgaged, margined, etc., You can say, "but you are effectively margining." But somehow it is psychologically different for me.

Your Honor, I never tried to sell a senate seat!

I am not going to go through all the work of coming up with numbers as then you will want an independent party confirmation. I already had some BRK, but I wrote my first put option to acquire more January 1, 2010. Since then, I have used writing puts to increase my core position and I occasionally sold covered calls. I have never been called out on any of my core position. My outperformance is greater than zero, but I can’t tell you if is it 0.5% or 2%. If you want to continue to be aggressive and use terms like my post is meaningless than I am done. I am just trying to share information.

Getting a lower price isn't outperforming?

Thanks @gfp

I would be happy to bring him lunch!

@John Hjorth John, I actually responded to this thread just before you asked me. I agree about taking this off track and I don't think I have anything more to add.

I don't keep track and that would be a lot of work for me to come up with.

Here is just a quick look, see page 18, https://www.berkshirehathaway.com/letters/2008ltr.pdf Edit: It will probably take my old memory a while to retrieve it, but I probably have somewhere, maybe a book, that talks about option trading in his early days.

I don't know abut SP 500 index and writing options. With my core BRKB position, I have never been called out. I have had to buy back calls and rewrite them at a later date but eventually they expired. (Note I always had a positive net when I bought back the options and wrote options at a future expiration date because of the time values.) So my return is whatever the return is for BRKB plus whatever I have gotten writing calls. I don't write calls on this core position often, just when it seems unlikely that I will get called out. 28 years of trading options and I am not bankrupt yet! Edit: It is a strategy Buffett used to use.

With BRKB possibly. I just don't do it continuously and don't want to spend the time to go back and look at what I have done. With a stock like KO there is no doubt I am way ahead than with just owning the stock. It is not a few cents per share. It is a few dollars per share over the space of a week or less sometimes. Yes it might be for the entertainment but it is essentially how I get into my long-term positions. I think of writing a put as putting in a limit order. There was only one time this did not work, when I was trying to buy some MCD around $95 and my put expired and I never got my MCD.

A covered call and a put pretty much result in the same outcome.

@John Hjorth I am currently short 465-strike, 480-strike, and 485-strike Feb 28 expiration puts on BRKB. I also have covered calls written at a 485-strike price on BRKB on a position I was put to a couple weeks ago. I am currently 100% invested, so this is how I effectively margin without being on margin. Edit: 80% of my portfolio is BRKB because it has grown and I don't want to incur capital gains tax.

It is called being in the insurance business.

73Reds is correct. I do this often with BRKB. Sure initially you buy the call back at a loss, but you immediately sell a further out call sometimes at a higher strike price and for a higher premium than the one you just bought back because it has no time value left on it.

thanks for pointing that out @John Hjorth I'll take another 8 percent!

A fan of The Who and Led Zeppelin! Thanks for posting @John Hjorth

Looking it up I see I started purchasing BRK in 2008. Good thing I checked because my memory thought earlier. I have been adding continuously. I always have some open put positions I have written. When put to I sometimes keep the shares and sometimes I write covered calls on them. My lowest purchase price was $60.24.

I am really disappointed that Schwab got rid of StreetSmart Pro in favor of Thinkorswim.

RIP Marianne (or Carrie-Anne as the Hollies would secretly refer to her in song)

If the Polgar sisters lived in your building that would be interesting.

I do a lot of this. KO is a good example when it is around $60. On 1/23 I wrote Feb 21 60-strike puts for a little over $0.60 per share. If I get put to I will write $60-strike calls. If KO goes up in price I will wait till it comes back down to do it again, and again, and again... Also all the stuff I do own I got my positions by being put to. That helps me to be patient and get a better price.

TAP does look good. I "put" part of one toe in writing a Feb 21, 52.5 strike put for $1.21, LOL.

Relying on "experts" who are usually wrong, https://www.smithsonianmag.com/smart-news/why-experts-are-almost-always-wrong-9997024/