This week produced the highest options premium income since I started tracking the portfolio.
While the portfolio gained a relatively modest 0.36%, the underlying trading activity was considerably more interesting. A sharp rally in NVIDIA, the introduction of Netflix bull put credit spreads, and a strategic shift away from Pfizer all contributed to a record premium-generating week.
NVDA Continues to Drive the Portfolio
The biggest story this week was NVIDIA.
At one point, NVDA shares traded above $230, extending an already impressive rally. Strong stock performance is generally welcome, but it also creates an interesting challenge for covered call sellers.
Our existing NVDA covered call had moved extremely deep in the money, effectively capping much of the position's remaining upside.
As a result, I rolled the covered call from the November expiration to June 27, 2027.
One lesson I continue to relearn is that covered calls work exceptionally well in flat or moderately bullish markets, but they can become frustrating during powerful bull runs.
The position remains profitable, yet it is still difficult to watch the underlying stock continue rising while gains are capped by the short call.
For now, NVDA remains the anchor position in the portfolio. Preserving the long-term holding is more important than maximizing short-term options income.
This is one of the main trade-offs covered call investors accept in exchange for receiving recurring premium income.
Why I Added NFLX Credit Spreads
Following NVDA's strong rally, I became less comfortable relying on it as the portfolio's primary source of weekly premium income.
Strong momentum often encourages traders to sell more options, but extended moves can reverse quickly and create difficult situations for premium sellers.
Rather than increasing exposure to NVDA, I decided to diversify.
This week I opened the following position:
NFLX May 22, 2026 84/79 Bull Put Credit Spread
The initial plan is straightforward: test Netflix credit spreads for approximately ten weeks and evaluate whether NFLX deserves a permanent place in the portfolio.
One of the main advantages of credit spreads is that they can be deployed across several stocks without requiring the same amount of capital as cash-secured puts or direct share purchases.
This capital efficiency is one reason bull put spreads have become one of my preferred strategies for smaller accounts.
Current Options Positions
- NVDA May 22, 2026 197.5/185 Bull Put Credit Spread
- NFLX May 22, 2026 84/79 Bull Put Credit Spread
- 2x BMY Jun 18, 2026 50/46 Bull Put Credit Spreads
- DBK Jun 19, 2026 24/20 Bull Put Credit Spread
- ARCC Sep 18, 2026 $16 Cash-Secured Put
- NVDA Jun 17, 2027 $125 Covered Call
Most of the portfolio's current premium income comes from bull put credit spreads. Their defined risk and relatively efficient use of buying power make them particularly suitable for a smaller portfolio.
Ending the Pfizer Wheel Strategy
This week, our Pfizer puts expired worthless.
Rather than continuing the Wheel Strategy on PFE, I decided to stop selling additional Pfizer puts.
Instead, I plan to accumulate approximately 0.5 Pfizer shares per week as a long-term dividend investment.
This decision reflects a broader shift in the portfolio.
Options remain the primary income engine, but I also want to gradually accumulate productive long-term assets capable of generating future dividend income.
Reinvesting Premium Into New Shares
Using premium collected from the NVDA and NFLX positions, I purchased:
- 0.1 shares of NVDA
- 0.2 shares of NFLX
- 0.5 shares of PFE
This remains one of the central ideas behind the portfolio. Rather than withdrawing options income, I reinvest part of the premium into long-term holdings.
The individual purchases are small, but repeated additions can gradually compound into meaningful positions.
As a result, projected annual dividend income increased to $64.17. The amount remains modest, but the current income is not the main objective.
The larger goal is to build a system in which options premium helps finance future portfolio growth without requiring constant external capital contributions.
Record Premium Income, but Realistic Expectations
This week generated $245.90 in options premium.
While this is a record for the portfolio, I do not expect this pace to continue indefinitely.
One of the biggest mistakes options traders make is extrapolating an unusually strong week into the future. A more realistic long-term target remains approximately $100 per week in average premium income.
Some weeks will generate more, while others may produce very little or even require defensive position management.
The objective is not to generate the same amount every week. It is to build a repeatable process that can survive changing market conditions.
Margin Debt Remains a Priority
The current margin balance remains approximately -$3,130.
At this week's premium-generation rate, the debt could theoretically be eliminated within several months. In practice, markets rarely remain this favorable for long.
My expectation is that reducing the margin balance will remain a longer-term project, potentially extending into 2027.
That is perfectly acceptable. One of the most important lessons options trading teaches is that survival matters more than speed.
Aggressively chasing premium in order to eliminate the debt faster would likely introduce more risk than the portfolio can reasonably absorb.
Looking Ahead
Next week's main event is NVIDIA earnings.
Following such a strong rally, I would welcome a period of consolidation and lower volatility. Stable markets are often more favorable for premium sellers than explosive moves in either direction.
The positions I will be monitoring most closely are:
- NVDA 197.5/185 Bull Put Spread
- NFLX 84/79 Bull Put Spread
Should either position come under pressure, the plan remains unchanged:
- roll when appropriate;
- prefer collecting additional credit;
- prioritize portfolio stability over short-term perfection.
Key Takeaway
This week reinforced a lesson that applies to almost every options strategy: the goal is not to maximize premium at all costs.
The real goal is to build a repeatable process.
Whether through covered calls, cash-secured puts, or bull put credit spreads, disciplined risk management and gradual portfolio growth remain the foundation of the strategy.
Record premium income is encouraging, but the portfolio will ultimately be judged by how well it performs across many different market environments, not by the result of a single strong week.
Disclaimer: This trade journal reflects personal portfolio activity and is provided for educational and informational purposes only. It should not be considered investment advice or a recommendation to buy or sell any security or derivative instrument.