Market Movements

^{*Weekly Return is calculated as market open of the previous Wednesday, to market close this Tuesday (yesterday); Current Level is Tuesday’s (yesterday’s) close.}

Weekly Watch

• The S&P 500 continues grinding to fresh all-time highs near 7,610 off of resilient growth and AI momentum. Is this breakout going to hold or is profit-taking going to set in due to stretched valuations and rising long-term yields?

• Speaking of yields, longer-dated Treasury yields remain elevated, with the 30-year hovering near 5% and the 10-year around 4.5%. Persistent selling pressure reflects stickier inflation expectations and lower odds of near-term Fed cuts, keeping financial conditions tighter than many bulls anticipated.

• This week’s economic calendar is also packed with potential catalysts, including ISM manufacturing and services data, ADP payrolls, jobless claims, and the May jobs report. Stronger-than-expected prints could reinforce higher-for-longer rate views and pressure risk assets, while softer numbers might offer relief.

Thought Throttle

Don’t sell Cash-Secured Puts on companies that shouldn’t be owned.

If you’ve been a subscriber for a while, I probably sound like a broken record. But this is one of the most common mistakes I see, and it’s also one of the easiest rules to break.

“This time it’s different.” “I probably won’t get assigned.” “Just collecting a little premium…”

Terrible mindset.

Don’t torch hard-fought gains chasing a few bucks of premium. Don’t bet the kingdom on a pot of gold.

Super simple filter before selling any CSP:

A few basic questions need to be asked. An honest and important calibration.

Do I actually like the business?

What does the company do? Could I explain why it’s decent to a friend? Does it feel like it has some real edge (better product, strong brand, etc.)?

Is the company healthy?

Is it making money? Growing? Does it seem stable or is it drowning in problems and debt?

Would I happily buy it at this price?

The CSP means you could end up owning the stock at the strike (minus the premium you collected). Would we be okay buying it there right now?

Am I okay if it drops more?

Could I hold the shares for months without panicking if the price falls another 10–20%?

Quick reminder: Volatility and risk are not the same thing. A good company can drop in price. That’s volatility.

Owning a bad company is real risk.

If we can’t answer “hell yeah” (or at least “yes”) to most of these, probably best to walk away. There are plenty of other opportunities.

Only sell cash-secured puts on stocks we’d be genuinely happy to own if we woke up owning them tomorrow.

The temptation is to constantly take action. And action does beat inaction (don’t be lazy).

But action doesn’t mean more trades. At its best, it is ruthlessly avoiding opportunities that are a complete waste of time and capital.

We’ll dig deeper into the actual fundamentals in future editions (and in a free resource that is coming soon).

But if you start here, you’ll already be way ahead of most option sellers.

Thanks for reading, best of luck out there.

Quote(s) I Like

Trade Mechanics

Let’s look at an opportunity for a cash-secured put in Tesla (TSLA).

The strike below represents a ~25-delta put expiring July 17th, 2026.

If we wanted to buy Tesla (TSLA) at a discount, we could sell the $385 July 17th, 2026, Put for about $10.65 in premium. With shares trading near $423.74, that represents roughly a 2.85% return on risk over 45 days, and about an 11.7% discount from the current price if assigned.

If the stock remains above $385 through expiration, the option expires worthless and the premium is kept as income ($1,065 kept). If the stock falls below the strike, assignment would result in purchasing shares at an effective cost basis of $374.35.

This is for educational purposes only—not a trade recommendation. Remember to always do your own due diligence and consult a financial advisor before making investment decisions.

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Disclaimer

The information provided in this newsletter is sourced from reliable channels; however, we cannot guarantee its accuracy. The opinions expressed in this newsletter are solely those of the editorial team, contributors, or third-party sources and may change without prior notice. These views do not necessarily reflect those of the firm as a whole. The content may become outdated, and there is no obligation to update it.

This newsletter is for informational purposes only and does not constitute personal investment advice. It is not intended to address your specific financial situation and should not be construed as legal, financial, tax, or accounting advice, or as a recommendation to buy, sell, or hold any securities. No recommendation is made regarding the suitability of any investment for a particular individual or group. Past performance is not indicative of future results.

Options come with inherent risks. We strongly advise you to consult with a financial advisor before making any investment decisions, including determining whether any proposed investment aligns with your personal financial needs.