Before I sell a single put, I ask these 5 questions.


This is the filter. If anything fails, I pass. No exceptions.
1. Is this stock trading below intrinsic value?
If it is not cheap, I do not sell the put.
2. Does it have a moat & pricing power?
Can it raise prices without losing customers?
Can competition easily copy it?
3. Is EPS growing?
Profits drive stock prices in the long run.
If EPS is not growing, I am not interested.
4. Am I OK to own the shares long term if assigned?
If I would not want to own the shares, I should not sell the put.
5. Are my ratios in check?
Can I take assignment without a margin call even in a 50% market drop?
If no, I do not make the trade.
95% of trades I look at get rejected.
The 5% I do — I go with conviction.
This is how I have been beating the market for over 10 years.
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