ProShares Bitcoin ETF (BITO)
In Income Trader, we’ve managed to lock in a return of over 45% in BITO. Not many can say they’ve made money in BITO on a more consistent basis, or any other crypto-related asset, since the beginning of June 2022. Just another reason why more and more individual investors are flocking to the tried-and-true, mechanically driven, income wheel approach.
Today I want to buy back our puts, lock in more profits and immediately sell more puts.
BITO is currently trading for 31.72.
Here is the trade:
Buy to Close BITO March 15, 2024, 19 put for $0.06. (As always, prices will vary, please adjust accordingly.)
Once that occurs (Or if you are new to the position):
Sell to Open BITO March 28, 2024, 28 put for $1.05. (As always, prices will vary, please adjust accordingly.)
Delta of short put: 0.25
Probability of Closing Out-of-the-Money: 67.69%
Probability of Touch: 58.67%
Total net credit: $1.05
Max return (cash-secured): 4.0%
Risk Management
We use BITO as part of our Income Wheel Portfolio, so if BITO closes below our put strike at expiration, we will be assigned shares of BITO (per the guidelines of the strategy). Until that point, we will repeatedly sell puts on BITO. Of course, any necessary trade alerts/updates will follow.
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