The Power of Being Right Once.

Sell options, or simply sit on your hands with time and asymmetry on your side—while enjoying steaks and wine.

I strongly believe that learning basic options selling is crucial for any investor, no matter their experience level.

Imagine you hold a stock that you’ve built solid conviction around, and it has an active options market. To earn some additional income, you decide to write (sell) a basic option on it. If the stock finishes in-the-money (ITM) at expiry, you can take advantage of the capital gains from the option + premium. If it doesn’t finish ITM, you still keep the premium you earned from writing the option, giving you income regardless of the stock’s movement.

When I left my job in Australia, packed everything up, and started travelling, options selling made a lot of sense. It kept me busy—I monitored the market and sold premium on days when my stocks were either in the red or green. While it wasn’t always consistent, it provided some income, giving me peace of mind that I was doing something productive after leaving a demanding job back home.

Looking back over the last two years since I started trading, was it totally worth it?

Recently, I made close to my old job’s salary (on paper) within a few weeks on an asymmetric trade—Nam Cheong, a micro-cap Singapore-listed offshore services company—because I had the conviction to scale it into a large cash position, sacrificing my options-selling trading account.

After well over two years of options selling, here is how I would focus my energy to maximise my time and market opportunities if I were to quit my job and do it all over again.

What is an Asymmetrical Trade?

An asymmetric opportunity is one where the upside is much greater than the downside. While most people feel this way when they buy any stock, certain factors can truly set apart a real opportunity.

Take Nam Cheong, for example: bankrupt, favourably restructured debt, re-listed in Singapore, dumped by former creditors (sellers exhausted), business improving, and a CEO holding +37% of the stock. It’s a unicorn setup in hindsight, but my goal is to recognise and scale the next opportunity that comes along.

This is exactly what Trader Ferg and Brad McFadden talk about each month on Trader Ferg. Over the years, they’ve inspired me with their emotionally detached approach to downside volatility—something I used to struggle with. Slowly, I’ve gotten better at handling the stomach-churning drawdowns.

“Our biggest asset as an individual investor is that we have to be more patient than everyone else.” - Brad and Trader Ferg's latest podcast.

Right now, I’m a bit carried away after the last few weeks. It’s been brutal for most of the positions in my portfolio, except Nam Cheong. But that old saying, ‘you only need to be right once,’ rings true.

After Nam Cheong’s recent moves, I now believe it’s time to rethink my approach to holding stocks solely for their liquid options markets. Typically, holding stocks with active options markets means focusing on large-cap stocks (>$1B market cap), where you can capitalise on volatility and earn premiums. However, this strategy limits your upside potential, and you might miss out on the greater opportunities that micro-cap stocks with favourable asymmetrical setups can offer.

While this strategy can work well for generating income, as I’ve demonstrated, you don’t want to miss out on an asymmetrical trade setup. With these types of trades, you only need to be right once to unlock massive potential. Frankly, unless you’re trading with a significant-sized account ($500k–$1M USD), the standard 2% return expectation from options selling will be easily eclipsed by the gains from just one successful asymmetrical trade—even if it takes years for that stock to perform.

Where am I focusing my time going forward?