Options Trading Journey: $6K to $100K Strategy Guide - Week 1

Starting Small: My Journey to Financial Growth

Hey there! Welcome to the first entry of my "Road to $100K" journey. I'm kicking this off with $6,713 - and yes, I know what you might be thinking: "Why not start with $5k, $10K or $25K?" Well, here's the truth: this is exactly where I am in my journey while building Selling Options HQ, and I strongly believe in starting with what you have instead of waiting for that "perfect" moment.

Let me be completely transparent with you - I deposit $100 weekly into my Schwab account. This is my demonstration account, and I'm using it to show you how I generate passive income while keeping my full-time job. If you're like me, starting with a modest account and looking to grow it steadily, I think you'll find my approach pretty relatable.

Before we dive deeper, I want to emphasize something important: the trades and tickers I discuss here reflect my personal risk tolerance and trading style. Rather than copying these trades directly, use them as inspiration to develop your own strategy that aligns with your risk comfort level and financial goals.

Let me share a bit about my journey: My first two years in the stock market were challenging, to say the least. I made classic beginner mistakes - chasing meme stocks without understanding fundamentals, getting caught in pump-and-dump cycles, and holding declining positions hoping for a recovery. These expensive lessons taught me the importance of proper education and strategy development.

The turning point came through dedicated learning: countless hours studying technical analysis, consuming educational content from experienced traders, practicing chart analysis, and diving deep into market fundamentals. One of my core beliefs is that continuous learning is crucial in trading. If you're truly passionate about mastering the markets, you can develop the necessary skills through consistent effort and dedication.

The Power of Consistency and Accountability

Consistency is the cornerstone of this strategy. While aiming for 1% weekly returns might sound modest, it's this steady, disciplined approach that can potentially transform a small account into significant wealth over time. However, it's important to acknowledge that no trader is perfect - myself included. There will be trades that don't work out as planned, and that's part of the journey.

Success in trading isn't about avoiding all losses; it's about being consistently profitable over time. This blog series serves two important purposes: it's my trading journal for accountability, and hopefully, a valuable resource for others on similar journeys. By documenting both successes and setbacks, we can learn and grow together.

While this first post is comprehensive to establish our foundation, future updates will be more focused on specific trades, market analysis, and strategy adjustments.

My Stock Selection Strategy

Let's talk about how I identify potential trading opportunities. While high option premiums are attractive, my selection process goes much deeper. Here's my three-pillar approach to finding quality stocks for options trading:

1. Financial Health Assessment

First, I dive into the company's financial statements, focusing on two critical metrics:

• Net profit margins and trends
• Free cash flow generation

If a company isn't profitable yet, I look for clear indicators of approaching profitability. Strong financial fundamentals often provide a safety net for options trades, especially when selling puts.

2. Business Model and Market Position

Understanding the company's role in the market is crucial. I evaluate:

• Product/service offering and competitive advantages
• Industry sector alignment with current market trends
• How well the business matches current economic conditions and policy directions

3. Technical Analysis

Chart analysis helps time entries and exits. I look for:

• Key support and resistance levels
• Fair value gaps that might attract price action
• Bullish or bearish pattern formations

4. Risk-Reward Assessment

Before executing any trade, I carefully evaluate the risk-reward profile:

• Delta range: I prefer options with 0.1 to 0.3 delta for a balanced risk-reward ratio
• Return on Capital (ROC): Calculate potential returns against maximum risk
• Chart setup: Look for clear support/resistance levels that align with strike prices
• Premium vs. Risk: Ensure the premium collected justifies the capital requirement

This systematic approach helps me avoid emotional trading decisions and maintains a consistent risk profile across different market conditions. By focusing on options within my preferred delta range, I can find opportunities that offer attractive premiums while keeping probability of profit in my favor.

By following these criteria, I aim to select trades that offer both attractive premiums and solid underlying value. This approach helps reduce risk and increases the probability of consistent returns, even if some trades don't go as planned.

My Weekly 1% Strategy: Keeping It Real

Here's my strategy: The goal is to achieve approximately 1% weekly growth by selling out-of-the-money (OTM) options with deltas between 0.1 and 0.3, while maintaining consistent $100 weekly deposits. Through compound interest, this 1% weekly return could potentially yield around 50% annually on the initial investment (excluding the weekly deposits). While this significantly outperforms traditional market returns, I understand it's an ambitious target. Throughout this journey, I'll demonstrate how I plan to achieve this through strategic position selection, proper risk management, and disciplined trading practices.

The Power of 1% Weekly Compound Growth

Let me break down what this strategy could look like over the next 5 years, starting with my current $6,713, with weekly deposits happening all 52 weeks but compounding occurring only during the 50 trading weeks:

• Year 1: Expected Range $14,700 - $16,200
  • Starting: $6,713
  • Yearly deposits: $5,200 ($100 × 52 weeks)
  • Trading weeks: 50 (1% weekly growth)
  • Base growth: $6,713 × (1.01^50) = $11,025
  • Deposit growth: $5,200 contribution + estimated trading gains
• Year 2: Expected Range $25,500 - $28,500
  • Starting: ~$15,500
  • Yearly deposits: $5,200
  • Trading weeks: 50
• Year 3: Expected Range $40,000 - $45,000
  • Starting: ~$27,000
  • Yearly deposits: $5,200
  • Trading weeks: 50
• Year 4: Expected Range $59,000 - $66,000
  • Starting: ~$42,500
  • Yearly deposits: $5,200
  • Trading weeks: 50
• Year 5: Expected Range $86,000 - $96,000
  • Starting: ~$62,500
  • Yearly deposits: $5,200
  • Trading weeks: 50

This calculation uses a compound interest formula that accounts for:

• 50 trading weeks per year
• Weekly 1% return on the entire balance
• $100 weekly deposits ($5,200 annually)
• Continuous compounding effect

Based on these projections, maintaining consistent discipline and achieving our target returns could potentially grow our $6K starting balance to $100K within 5-6 years. While this timeline might vary depending on market conditions and trading performance, it provides a realistic framework for our long-term goal.

While my primary focus is on selling options, I'm also implementing additional strategies to maximize returns:

• Strategic stock swings on news driven tickers
• Scaling in position during market dips
• Active portfolio rebalancing based on market conditions
• Combining both options premium and stock appreciation for optimal returns

My Week 1 Trades

This week, I focused my strategy on Cash Secured Puts (CSPs) on $SOXL. Here's what I did:

• I ran 2 CSP contracts on $SOXL (both expired profitably):
  • My first contract: $26 Strike, expiring 2/14/25 - I received $77 in premium
  • My second contract: $26.50 Strike, same expiration - I got $66 in premium

What I'm Holding Now

As of February 16, 2025, here's what's in my portfolio:

• 10 shares of $MSTX (I'm using this as my Leveraged BTC ETF play)
• 6 shares of $AMD (I got in at an average of $112.77)
• 115 shares of $EVGO (My average cost here is $3.47)

My Next Moves

With my SOXL CSP options now expired, I have approximately $5,250 in available capital ready for deployment. To identify my next opportunity, I'll be leveraging our options scanner to find trades with optimal premium-to-risk ratios. This tool has consistently helped me identify the most promising opportunities in the market.