$Direxion Daily TSLA Bull 2X Shares (TSLL.US)$ by now you wo...

maybe you bought it yesterday betting on this event, maybe you've owned it in the past and you're profitable and you were looking for an amazing robo taxi event which turned out to be a robo-flop. maybe you've traded it in the past and you left profits in the company because long-term you believe it's going to be an amazing success.

whatever the reason this morning the stock is down it's traded significantly more volume pre-market than it does in a typical day it is institutions dumping just so that you know this is not all retail. and you're trying to figure out well what the hell do I do now

so you ask yourself what would 10baggerbam do?

I'll tell you what I'm going to do.

the first thing is you can never fall in love with the company we all do it I do it at the end of the day it's a vehicle to make money with. we are The pimps and the stocks are are ladies that we put out on the street to make us money.

I know that analogy may not be suitable inappropriate but if we think of it that way it lets us make a more rational decision and removes the emotions behind it.

so let's suppose you bought the stock 100 shares in this case I'm using the leverage ETF because that's what I trade which is great when it goes up but when it goes down you're ready to vomit.

so let's suppose you bought 100 shares or 1000 shares or 10,000 shares or let's suppose that you have a equal round lot of profits in the company at this point.

what I am going to do and I would encourage others to do the same but ultimately your risk tolerance your objectives your goals may not be in alignment with mine. so if you have questions ask don't just do it if you don't understand it don't do it learn.

options are your friend or options will destroy you you have to pick your battles.

so because the option Market does not have early morning trading I'm going to reference prices to yesterday's close of this leveraged ETF and the common stock but the percentages are a sliding scale and for the most part will be about the same on the open or shortly a few minutes after the open relative to the stock / ETFs price.

yesterday we were just higher than 11.50 at the close. this ETF has options that expire every week every Friday just as the common stock does. so what I am going to be doing and the reason why I'm doing it is I'm getting put a lot of stock today cuz I sold puts on Monday below what I thought was an impossible level for it to hit and looks like I'm going to be wrong.

I'm going to get put this ETF at $10.50, and rather than wait for next week as long as I know within about a minute or so of the clothes today if it's $10.49 I can't do it if it's $10.50 or above I'm not going to do it and I hope it is but it won't be so I'm going to immediately go out and sell on October 18th $10 strike option. I'll be able to collect right around 80 to 85 cents a contract and whether I'm at the money or slightly out of the money or in the money by a nickel or so it's really a moot point.

let's suppose you have 1,000 shares you'd sell 10 October 18th $10 strikes. you'd collect about 80 to 85 cents and we'll know at the open where the option contracts will be trading. so rather than wait for the stock to bounce back for you to get broken even and regain your capital and this obviously is a non-exact science it could go up on Monday in which case you go well this is a stupid idea or the stock could continuously train lower in which case this is a smart thing to do.

so you sell 10 October 18th $10 strike collect let's call it 80 cents as $800. that's like if you lose it that Friday at 4:00 p.m. getting $10.80 for your stock. so in my case because I'm getting put the ETF if it closes at 10.50. I'm actually making about 30 cents rather than waiting for the stock to recover to break even.

if the end of next week the stock trends lower yeah you could stop out you could sell it that's an option for you you could do that sure or you sell another contract for another week another covered call, collect the premium again and you're going to get as long as there's volatility in the stock which it always has you're going to get about that 75 80 85 cents for an at the money contract.. and you don't need to sell those if it drops a little bit less and you don't want to risk losing it you can sell it out of the money contract 50 cents higher so if the stock the end of next week is $9.80 you can still sell a $10.50 contract if you chose maybe you get 50 cents a contract so now in two weeks you've collected it call it 1.30 in total money coming in per share against the stock that is down flat not recovering.

well $1.30 for 2 weeks worth of time over getting put the stock at $10.50 is about a 9% return

so this is what I am going to be doing and I'll do it in perpetuity every week I will do it and there's our times that if you get a knee-jerk reaction down the option contract declines in value and you can roll the dice do you close it out waiting for a quick recovery and go out and sell another one and I've done that too and you can get an extra quarter 3/8 in a day by doing that but that's really rolling the dice cuz if it doesn't recover you're screwed.

so this is how using covered calls using options or your friend will recoup your principal much quicker than just buying and holding has the ability to generate you income while you wait kind of like a big fat dividend and additionally has the money to take a losing investment and generate a very very nice profit even if the stock trade sideways.

I do this all the time I sell calls against my positions all the time and cumulatively it will return an excessive about a 10% yield on investments that I make throughout the course of a year it's free money.

if you have questions ask but don't miss part two because there's something really exciting I have to share with you.