Options are neither an income strategy nor an investment strategy.

The moral of the story is there is no free, stick to your game plan and be consistent

When you're at a party having a chill time bragging to all your peers about how you quit your job cause you're doing fatFIRE, using credit card miles to pay for flights, and using the wheel to generate theta as a passive income strategy to beat the S&P.

And that one asshole points out expected value. Really ruining the vibe of the party.

OP doesn’t know what he is talking about. Bonds fail p, companies go bankrupt and bonds get repriced regularly. Sometimes due to imterest rates sometimes due to corporate performance. They used to be an offset to stocks to reduce volatility on your portfolio but that relationship has broken down and when stocks fall bond tend to as well.

As for options OP fails to grasp options were created as a way to offset risk. Misusing them is taking on risk you don’t want but using them correctly reduces risk. Apparently OP can only see half the equation. Maybe has something in their past perhaps?

Looks like a silly equivocation trying to make some argument about investment vs trading like there is any actual real difference and arguments about semantics are profitable pursuits. I guess the bear vs bull gang fight was cancelled?

The buckets are mixing up cash flow timing with risk. Income just means a position throws off cash on a schedule, it says nothing about whether that cash is guaranteed. Bonds are not risk free income either once you account for duration, credit and reinvestment, you just feel it less. A short put or a covered call does generate income in the literal sense, realized premium hitting the account. Whether that income is net positive over time comes down to one thing, whether the volatility risk premium you are harvesting is large enough to pay you for the left tail you are short. That is the actual debate worth having, not the label. And most of the people who blow up wheeling are not wrong because it is not income, they are wrong because they chase the fattest premium they can find, which is exactly where the VRP is thinnest relative to the risk you are taking.

... or you come to realize that some people are better and doing things you fear. Profit is income, there's really no way to twist that around into making money means no income. You and OP are looking for guarantees, little risk, low profit ventures. Options are not for you.

Imagine coming to an options sub and telling everyone what we're doing has no income, makes no profit, all because there are no promises.

mostly agree with the spirit even if neither is too absolute. an option is a tool for transferring risk, and selling premium is just getting paid to take the other sides tail risk. calling that income is the dangerous part, because the cash flow looks steady right up until the one event that gives it all back, thats the short-vol payoff in a sentence. it can be part of a strategy, it just isnt a free coupon the way a bond actually is. the people who blow up are the ones who booked the premium as income and forgot they sold insurance.

Only time and direction. What the option does in the meantime might be useful to certain types of volatility trading but isn't really part of the equation regarding simply receiving profit. One step further; if the premium of a short put exceeds the decline of the shares when expiring ITM, that's actually profit, which is one of the reasons the cost basis is determined by strike minus premium. The other reason is realized vs unrealized gain. Assigned short puts are not realized gain nor loss until the shares are sold essentially stopping a taxable event simply by being assigned.

I mean it doesn’t take that much time to sell a couple of far out of the money puts on NVDA or AMZN every month 😂. This post seems to be dramatic for no reason.