Weekend Windfalls

Trading Manual &

Quick-Start Guide
by Mike Larson, Editor
Juan Villaverde, Trading Specialist
Mandeep Singh Rai, Ratings Specialist

Copyright © 2020
Weiss Ratings, LLC

For the exclusive use of

subscribers to Weekend Windfalls.

4400 Northcorp Parkway | Palm Beach Gardens, Fla. 33410

Phone: 877-934-7778 | Fax: 561-277-2576

© 2020 Weekend Windfalls. All rights reserved. No portion of this guide may be reproduced without written
permission from the publisher. Weekend Windfalls is owned and published by Weiss Ratings LLC.

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 Contents
Introduction: How Weekend Windfalls Can Make a Difference
for You ………………………………………………………………………… Page 3

Part 1: “Weekend Windfalls” Strategy Overview ……………… Page 8

Part 2: 3 Extra, Unadvertised Benefits ……………………….… Page 10

Part 3: Options Basics ………………………………………………… Page 14

Part 4: The Heart of This Service: Selling Puts on the Best of the
Best Stocks ……………………………………………………………….... Page 18

Part 5: Generating Additional Income Windfalls with Covered Call

Writing ……………………………………………………………………… Page 22

Part 6: Walking You Through the Weekend Windfall Methodology

— and How to Place Orders ……………………………………….… Page 25

Part 7: Getting Started & What to Expect ……………………… Page 28

Part 8: Frequently Asked Questions …………………………… Page 31

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 Introduction
Welcome to Weekend Windfalls!

I’m delighted you’ve joined and trust you are, too.

Starting this week, be sure to check your email every Friday morning at 10:30
a.m. Eastern (or very soon thereafter) for our recommendations on how to collect
your next Weekend Windfall.

In the meantime, your very first priority should be to make sure you’re all set to
act on our recommendations. Here are some simple steps I suggest you follow …

Step 1. If you don’t have one already, seriously consider opening an account at
one of the online brokers with the technology we believe is ideal to implement the
Weekend Windfalls strategy.

• Tastyworks is one of the leaders in this sector. It is among the easiest and
fastest to open an account. It’s also among the most convenient for selling
options — both for beginners and experienced investors.

• TD Ameritrade’s ThinkorSwim also has excellent technology.

Alternatively, you can use any other online broker, such as E*Trade, Fidelity,
Schwab, Interactive Brokers and many others. 1

Step 2. This service is primarily focused on selling put options, either with or
without a margin account. Therefore, make sure you get the required approval
with your broker. (Tastyworks provides approvals online and with the fewest
hassles.)

Step 3. Level 3 approval will likely be required if you choose to open a margin
account. Alternatively, you may also begin with Level 2 approval if you stick with
cash-secured trading.

Please be aware that the requirements and process may differ from firm to firm.
Some have a policy of discouraging investors from implementing this kind of
strategy and make more difficult to get up and running, while others make it
significantly easier.

1Weiss Ratings does not rate or recommend brokerage firms. Nor do we have any business-to-
business relationship with them of any kind. The comments here are based exclusively on a review of
their technology for the purpose of selling put options, which is the core of the Weekend Windfall
strategy.

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Step 4. If you are unable or unwilling to open a new online account, you may
continue using your existing brokerage account. It is also possible to implement
the instructions without online access. We give you everything you need to simply
pick up the phone and call your broker with your orders.

Step 5. Read this guide for a solid overview of our Weekend Windfalls strategy.
Be sure you understand both the benefits and risks. No one can guarantee future
performance or eliminate risk entirely. But an important goal of this service is to
greatly enhance the income you can achieve AND greatly reduce any downside
risks.

Step 6. Log on to the members-only page on our website with your username
and credentials we’ve sent you via email.

Step 7. Don’t rush! It’s better to do it right than fast. So if you’re not set up yet to
act on the first Weekend Windfall opportunities, no worries! There will be a
brand-new trade in the coming week, the week after … and beyond.

You will never have to catch up with old recommendations. When you’re ready,
you start fresh.

We feel Weekend Windfalls can help you achieve a truly life-changing

improvement in your income and cash flow. So we are committed to doing
everything in our power to guide you … and even help overcome any procedural
obstacle you may encounter.

However, if you are living exclusively on Social Security or cannot afford to take
any investment risk whatsoever, this service is not for you.

If you have any questions about our service or about opening an account, please
email them to us at [email protected], and we will do our best to answer
you right away.

And if you have some particular difficulties, you may also call our Weekend
Windfalls Concierge at 877-934-7778 for assistance.

The Most Conservative Trading Service We

Have Ever Launched in Our 49 Years in Business
If you’re interested in collecting about $1,000 for your next weekend getaway — and
nearly every weekend, starting this coming Friday — then be sure to read the balance of
this guide carefully.

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And if you’d like to earn multiples of $1,000 every week, we will show you how to do
that, too, while also pointing out any potential risks.

More so than any other trading service we publish, Weekend Windfalls is designed for
two things: Income that is both very high and extremely consistent.

The income potential is very high because of the power of the strategy we’ll describe in
just a moment.

And it’s extremely consistent, thanks to the accuracy of the Weiss Stock Ratings.

We’ll give you all the nitty-gritty details in a moment. But first, let us give you a quick
summary of all the benefits.

How Weekend Windfalls Can

Make a Difference for You
Do you want to head out on a nice golf outing?

Maybe you’d like to take a luxury spa weekend at the beach.

Or perhaps you just want to tuck away an extra $1,000 in your IRA.

Then all you have to do is set up your online brokerage account, log on, click a few
buttons, and you can collect your first windfall.

While weekly payouts can range from a few hundred to a few thousand dollars, the goal
is to get payouts averaging around $1,000 per week. Or, if you wish, multiples of
$1,000.

Once you know the secret, which we’ll show you today, you’ll see how to direct these
payouts into your account — with a nearly 100% success rate.

That means you could add an extra $50,000 or so your account over the next
12 months alone. And if you invest more, you could make $100,000, even $200,000
extra per year.

Once you’ve set up your account, it’s like collecting money from your own personal
ATM. So proper account set-up is critical, and we’ll give you very specific instructions in
just a moment.

Is our Weekend Windfall strategy 100% foolproof? No. All investing involves some risk,
and we’ll explain exactly the kind of risk there is in a moment.

But, if you had followed our Weekend Windfall strategy for the past three-plus years,
you could have pulled down instant cash 100% of the time.

And 99.7% of the time, you could have kept every cent — with no further obligation!

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No wonder our Weiss Ratings team has spent many months researching this
opportunity!

After $3.2 Million in Research Costs,

Our Biggest Income Breakthrough Ever
Weiss Ratings, as you may know, is the world’s leading provider of independent
investment ratings.

Unlike Moody’s, Standard and Poor’s and Fitch, Weiss never accepts any compensation
whatsoever from the companies it rates — whether directly or indirectly.

Weiss Ratings is 100% independent with no conflicts of interest.

The Wall Street Journal

reported that investors
following the Weiss Stock
Ratings could have made more
money than investors who
followed every other research
firm reviewed.

And it’s also the main reason

why, in another financial
sector, Weiss Ratings beat its
closest competitor by 3-to-1 in
accuracy, according to the GAO, the auditing arm of the U.S. Congress.

And now, to develop the Weekend Windfalls strategy, we’ve sunk more than $3.2
million into data costs alone. We’ve amassed a database of case studies totalling 1.94
billion data points. And we’ve run more than 70,237 computer-processing hours of beta
testing.

The result: A 99.7%-effective method for pocketing these Weekend Windfalls almost
EVERY Friday from now on.

What You’ll Need to Get Started

First, you do not need a lot of experience. If you’ve bought ETFs or stocks online, then
it should be easy. If not, we will show you how.

Second, we feel it’s important to follow our weekly instructions on precisely what to
trade and when — not only to maximize your income level, but also to avoid the
occasional pitfalls along the way. We are not saying this to resell you on our service.
We’re doing so strictly to emphasize the need to implement this strategy prudently.

Third, if you don’t have one already, you will need to set up an appropriate online
brokerage account.

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Almost all major brokerage firms provide platforms that you can use. Trouble is, some
fail to provide a platform that’s convenient, efficient and inexpensive. Maybe it’s
because they’re not interested in building this side of their business. Or perhaps they’re
seeking to discourage it. (More details in a moment.)

Fourth, you will need to make a choice regarding your income goals and how you want
to pursue them:

1. You can implement the Weekend Windfall strategy in the most conservative
possible way by securing your put sales exclusively with cash (cash-secured put
selling).

2. Or you can put up less than the full amount of cash.

3. Or you can push the envelope further and put up even less cash.

If you’re uncertain, we recommend starting with No. 1 or No. 2. Then, you can always
step up the pace later. And even if No. 3 is your choice, we will show you how to do so
prudently.

In some ways, the Weekend Windfall strategy is more conservative than buying stocks.
The key now is that, once you’re up and running, collecting these Weekend Windfalls
can be easy.

Whether you’re an experienced trader looking to add some high-odds income to the mix,
or simply a conservative long-term investor, you can start pulling down hundreds or
thousands of dollars nearly every week.

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 Part 1
What Exactly Is the
Weekend Windfall Strategy?
The strategy is primarily designed to take advantage of the market for stock options.

We know what you might be thinking: “Options are a crapshoot.”

And you’d be right — if you’re talking about buying options. In fact, according to the
Chicago Mercantile Exchange, on average, options buyers lose 82% of the time.

But in this service, our primary vehicle is the other side of the transaction: Instead of
buying options, we aim to strictly sell options.

That simple step alone gives us the opportunity for winning odds of 82% or more. But
it’s just the beginning.

3 Core Advantages
You Get with This Service
The first advantage is that you’re not taking the side of the gambler. You’re taking
the side of the house. So right off the bat, instead of 4-to-1 odds against you, you have 4-
to-1 odds in your favor.

The second advantage you get is this: The primary focus of this service is selling put
options to other investors.

Why do those investors buy put options? Often, it’s to place a bet that the stock is going
to fall. They want to profit from the decline.

Or, they may own the underlying stock. If they’re concerned their shares may soon crash
in value, they buy the put options as a way of protecting themselves.

If the shares actually crash before the put options expire, sure, they lose money in the
stock. But they have the opportunity to offset that loss with the profit they make in the
put option. That’s why we call it “crash insurance.”

Nothing wrong with that.

But guess what! Wall Street grossly overcharges for that crash insurance day after day.

How do we know? Because the premiums on put options are routinely more expensive
than the premiums on equivalent call options — an anomaly in the market that you can
exploit with this service.

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Indeed, because of this anomaly, other investors pay too much for the put options they
buy; they pay too much for crash insurance.

But you’re not buying; you’re selling. So you collect “too much” money, which is a good
problem to have. It means you have the opportunity to make more money on each trade.
That’s the second advantage.

The third advantage is the Weiss Stock Ratings.

Here’s the key: When you sell a put option on a stock, you make money if the stock goes
up. You make money if it drifts sideways. And you can even make money if it goes down
moderately.

So you want to always sell puts on the highest-quality stocks you can find.

And that’s why our strategy uses the Weiss Stock Ratings, which have an unbeatable
track record in picking the highest-quality stocks.

Result: Thanks primarily to the Weiss Ratings, you can improve your odds of winning
from 82% to 99.7%. That means you reduce the odds of losing from 18% to 0.3%, or by
54 times.
Here’s How it Works
Step 1: Every Thursday evening, after the markets close, we use the power of our $3-
million Weiss Ratings database to scan more than 11,000 stocks and to help pick the
strongest stock on the market.

Step 2: We pinpoint the one best put option to sell on that stock in order to collect the
biggest Weekend Windfall we can.

Step 3: We monitor the option until it expires worthless about 30 days later.
Not bad, right? What’s the downside?

In a tiny percentage of cases, the option does not expire worthless. When that happens,
we buy 100 shares of the underlying stock for each option sold.

Keep in mind, this is a stock we rated as one of the best out of 11,000 on the market. So,
what’s typically the consequence? You get to own shares of a stock we absolutely love!

We’re talking about quality, dividend-paying blue chips poised to generate income for
months or years to come. And in some cases, we’ll see fat capital gains too.

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 Part 2
Three Extra,
Unadvertised Benefits
We always seek to deliver more than we promise. And in this case, that means providing
you with extra, unadvertised benefits that can do even more to maximize your income
opportunities and minimize any risk.

Extra Benefit #1. Income-Booster Put Selling. Whenever we spot the

opportunity, we will send you instructions — either in a regular Friday issue or a Trade
Alert — that can help you boost the income you earn on a put sale.

Remember: When you sell a put option on a stock, you’re effectively selling crash
insurance. The premium is credited immediately to your account. And as long as there’s
no big decline in the stock, the insurance expires. You keep the entire premium you
collected. And you have no further obligation.

But suppose the shares actually go up? That’s even better! Because then you can make
even more money on the trend, sometimes double or more.

In practice, how does this actually work?

Well, let’s say, for example, Apple was trading at about $300 per share, and you sold
some put options on Apple for $1,000.

Now suppose Apple shares go up to $310 per share even before your put options expire.
Is there a way you can take advantage of it?

Yes! The rise in Apple shares gives you the opportunity to sell additional put options on
Apple to make even more income.

Better yet, in order to avoid putting up more cash, you can simply swap your old Apple
put sale for a new, richer, Apple put sale. And this is what we generally recommend in
this situation.

It’s quite easy to do. And don’t worry. When the time comes, we’ll explain the particulars
and give you play-by-play instructions. For now, just know that this strategy can give
you even more income than advertised.

Extra Benefit #2. Income-Booster Call Selling. Remember: The goal is to sell put
options, collect the money and have no further obligation. In other words, we want to
primarily sell crash insurance, earn the premiums and move on.

But, as we said earlier, in a small percentage of cases, the put option does not expire
worthless. The underlying stock falls in price, and after it falls, you buy 100 shares for
each option sold.

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To explain how this can unfold, let’s pick up from where we left off with the previous
example.

When Apple was selling at $300 per share, you sold put options on the stock. That
means you sold crash insurance — a contract that gave the buyer the right to sell you
Apple shares at, say, $290 per share.

But now, Apple shares fall to $290 or lower. The buyer executes the option. And you buy
Apple at $290 per share. In the parlance of the trade, we say the buyer “puts” the shares
to you. (That’s why it’s called a “put option.”)

We repeat: This is not a big problem, because it’s a stock we rated as one of the best out
of 11,000 on the market.

Still, the primary goal of this service is to collect Weekend Windfalls by selling put
options — not to build a long-term stock portfolio. So, we won’t recommend holding the
shares for a long time.

But as long as we do own the stock, why not take advantage of it?

That’s where this extra benefit comes into play: We recommend selling covered call
options on the stock, a very conservative income strategy. Then, no matter where the
stock trades next — up, down or sideways — you can collect even more income.

Call options are the opposite of put options: Investors buy them as a bet that the stock
will go up — not down.

As with put options, investors who buy call options lose about 80% of the time, on
average.

Also as with the put options, we don’t recommend buying calls in this service — we
strictly recommend selling them.

And as with put options, the money is immediately credited to your account.

That gives the buyer the right to buy your shares at some higher price than it’s selling for
today. In the parlance of the industry, it’s said that the buyer can “call away” your shares
in stock. (That’s where the term “call options” comes from.)

If you own the shares and you sell call options on your shares, what’s the downside?

In this strategy, none! If the stock goes up and the buyer executes the option to buy your
shares, fine. The primary goal of this strategy was not to own the shares anyhow. So you
should be content to have collected the extra income … to let him or her have your
shares … and to free up more capital to focus on the next Weekend Windfalls.

So far, so good, right? But you ask: “What’s the downside of this service?”

That takes us to the next extra benefit …

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Extra Benefit #3. Crash Protection. Continuing where we left off with the Apple
example, you now own shares at $290 per share or somewhat lower. If the stock goes up
from here, great! You can make even more money selling the call options we just told
you about … reaping gains from appreciation in the stock value … or even collecting
dividends.

But what if the stock falls even further?

Then you risk losing money.

How often does this happen? Our three-plus years of testing shows that it happens very
rarely. But the past is no guarantee of the future. So, what do we do?

Simple: We face this head on and recognize that it IS possible! And we implement a
contingency plan — just in case we need some enhanced protection in that scenario.

In this situation, if we think the stock could fall further, we may recommend that you
buy some crash insurance yourself.

In other words, instead of selling put options on the stock (the primary goal of the
Weekend Windfall strategy), you buy some put options on the stock — to help protect
your capital.

As we said earlier, in this strategy, suffering a loss on a falling stock in the first place is
rare. In our three-plus years of testing, it happened in only 0.3% of the cases.

What’s more, having a pressing need to buy put options on our stock is even rarer. In
fact, in our test period, that tactic was never used. But still, it’s good to have this tactic
available as a contingency plan.

In this example, if our Apple shares fall further, we simply seek to offset the loss in our
shares with the gains we make on our puts.

That’s what we mean by “crash protection.” It’s rarely used but still an important extra
benefit.

“One of the Greatest

Strategies in Existence”
Even without our Weekend Windfalls service — and even without these three extra
benefits — the strategy of selling put options is widely recognized for its income-
generating power.

A report on Nasdaq.com says that it “could be a way to increase your income by

hundreds or even thousands of dollars every month.”

And according to a report on CNBC: “It can be a good strategy in volatile, choppy
markets.”

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Barron’s says that it’s “One of the greatest strategies in existence.”

Plus, Barron’s also once published this big headline: “Weiss is the leader in
identifying vulnerable companies.”

In other words, we know how to avoid companies that get into trouble and go down.
And THAT’s key to boosting your odds of winning from 82% to 99.7%.

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 Part 3
Some Options Basics
We can’t wait to get into more of the nitty gritty details behind our Weekend Windfalls
strategy. But before we do, here are some more options basics that will help you take
even better advantage of this service.

For starters, an option is a contract between two parties that grants the owner the right
— but not the obligation — to buy or sell shares of an underlying security at a specified
price (the strike price) on or before a given date (the expiration date).

U.S.-listed options generally expire on the third Friday of the month. In the rare event
that the Friday is a holiday, the options expire on the preceding Thursday instead.

As we saw in Part 2, there are two basic types of stock options:

• A call option gives its holder the right — but not the obligation — to BUY an
underlying stock.

• A put option gives its holder the right — but not the obligation — to SELL an
underlying stock.

Each options contract covers 100 shares of a particular stock, known as a round lot.

There are options actively trading on most major stocks and ETFs, and investors
frequently use these investments as a way to hedge their portfolios or to speculate on a
stock’s future moves.

One advantage of using options like this is that investors put less capital at risk —
because buying a contract allows you to control 100 shares for a lot less money than it
would take to buy the shares outright.

But as we saw, on average, investors who buy options lose about 82% of the time. There
are good ways to buy options and beat those odds.

But this service is not about beating odds against you. It’s all about starting with odds in
your favor and then using the power of our Weiss Stock Ratings model to make them
even more favorable — 99.7% winning odds instead of 82%.

And again, there are two ways you can do this:

• As you saw in Part 1, in the service, the primary way you do it is by selling put
options. For each option contract you sell, you give the buyer the right to sell
100 shares of the stock to you. Then, after the option expires, he loses that right.

• And as you saw in Part 2, once in a while, you may also benefit by selling call
options. For each call option contract you sell, you give the buyer the right to
buy 100 shares of the stock you already own. Again, after option expires, he loses
that right.

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 How Put Options Are Priced
There are a few key factors that determine the price of a particular put option on a stock.

Pricing factor #1 is the STRIKE PRICE — the price at which the buyer can
exercise the option and sell the stock to you. With this in mind, here are three basic
categories of put options:

• In-the-money put options — when the current stock price is already lower
than the strike price.

Example: Apple is selling for about $300. But the strike price of the put option is
$310.

(In Weekend Windfalls, we never give you a recommendation to sell this kind of
put option.)

• At-the-money put options — when the current stock price is about the
same as the strike price.

Example: Apple selling for about $300; strike price of the put — also $300.

(We never give you a recommendation to sell this kind of put option, either.)

• Out-of-the-money put options —when the current stock price is higher than
the strike price of the put option.

Example: Apple selling for about $300; strike price of the put — $290.

This is the only kind of put option we recommend selling in Weekend Windfalls.

And all else being equal, when you sell a put option, the closer the stock price is to the
strike price, the more money you can collect.

But it’s not a good idea for the strike to be too close, because that gives the buyer a better
chance to exercise the option.

We calibrate our recommendations to help make sure you get the best of both worlds —
the most income and the best chance to keep that income without any further
obligation.

For example, with Apple selling at $300 per share, you can sell out-of-the-money put
options with the following strike prices:

297.50 — $2.50 below the current $300 price

295.00 — $5.00 below
292.50 — $7.50 below
290.00 — $10.00 below
287.50 — $12.50 below

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285.00 — $15.00 below
and so on

Imagine you’re on the third floor of a building that has two stairways — one stairway to
go down to the second floor, one stairway to go up to the fourth.

Right now, you’re selling puts to someone who’s betting that Apple shares will go down.
So the metaphor we want you to think about is the stairway going downstairs.

You want to decide at what price you’ll give him the opportunity to sell you Apple shares.

In the case of Apple at $300 per share, each step in the stairway represents $2.50; and
two steps represent $5.00.

So at two steps down, the strike price is $295.00. Four steps down, it’s $290.00. Six
steps down, it’s $285.00, etc.

Typically (but not always), we recommend you sell put options with strike prices that are
a few steps down, depending on the stock price, volatility and liquidity.

We seek to adjust the strike prices to give you the best combination of HOW MUCH
MONEY you can collect and HOW CONSISTENTLY you can collect it.

Pricing factor #2 is TIME — how much time is left before the option expires.

This one is pretty simple: Time is money. So, when you sell a put, the more time you give
to the buyer, the more money you can collect.

That’s great. But here again, there’s a disadvantage. Because the more time you allow,
the greater the chance that the buyer will have an opportunity at some point to sell the
stock to you.

As we said earlier, that’s not a bad thing per se.

But the primary goal of this service is to collect the income from selling the put options
and letting them expire worthless — not to wind up owning the stock.

So again, we calibrate our recommendations to help make sure you get the best of both
worlds — the MOST INCOME and the best chance to KEEP that income without any
further obligation.

To achieve that dual goal, our model tells us that the best options to sell are usually with
about ONE MONTH left before expiration.

Pricing factor #3 is expected VOLATILITY. For example, if a major news

event is coming soon — a highly anticipated Fed meeting, a major earnings
announcement or even an important election — investors expect more volatility, which
drives up the cost of options. Conversely, if investors expect very quiet trading in the
days or weeks ahead, the cost of options tends to fall.

Typically, as long as the options are on a high-quality security, the higher the implied

16
volatility … the higher the cost of the options … and the more money you can make by
selling them.

How Do You Figure out

How Much an Options is Worth?
With so many factors, calculating the value of a put option can be complicated.

For most investors, the simplest way is to check what it’s selling for right now. Although
sometimes it could be a bit undervalued or overvalued, the put options we recommend
selling are very liquid. So the market almost always prices them accurately.

Plus, there’s a formula for pricing any given option, created by two economists — Fischer
Black and Myron Scholes.

They first wrote about this in a 1973 paper titled “The Pricing of Options and Corporate
Liabilities,” which was published in The Journal of Political Economy.

And in 1997, Scholes and another economist, Robert C. Merton, received a Nobel Prize
for their work on options pricing.

The result is the Black-Scholes model. You don’t have to know the formula. You don’t
even have to use the model. We do all that work for you.

17
 Part 4
Selling Put Options on the
Best of the Best Stocks
So, now you know the basics of how options contracts work and how they’re priced. That
means it’s time to dig into the mechanics of this service — what exactly we’ll be doing
and why it can be so profitable!

As we explained, the strategy at the core of Weekend Windfalls is selling put options on
the best of the best stocks.

This is similar to what Warren Buffett has done for many years, although he trades more
in stock indexes and uses the equivalent of long-term put contracts.

Years ago, in a letter to Berkshire Hathaway shareholders, he wrote about it this way:

“We have added modestly to the ‘equity put’ portfolio I described in last year’s
report. Some of our contracts come due in 15 years, others in 20. We must make
a payment to our counterparty at maturity if the reference index to which the
put is tied is then below what it was at the inception of the contract ...

“Our put contracts total $37.1 billion (at current exchange rates) and are spread
among four major indices: The S&P 500 in the U.S., the FTSE 100 in the U.K.,
the Euro Stoxx 50 in Europe, and the Nikkei 225 in Japan. Our first contract
comes due on September 9, 2019, and our last on January 24, 2028. We have
received premiums of $4.9 billion, money we have invested. We, meanwhile,
have paid nothing, since all expiration dates are far in the future.”

Now, if you were to ask brokers why they don’t advocate that regular investors use a
similar strategy, they would probably say because it’s too complicated or too advanced.
Worse, they might use their ultimate scare tactic and tell you it’s too risky.

Granted, there are risks. As we’ve been telling you all along, all investments involve risk.

But the fact is, selling put options can also be a very conservative strategy.

So much so that many brokerages will also let you sell put options inside a
traditional IRA retirement account.

We repeat: With put writing, you’re simply selling crash insurance to other investors.
And you get to control ALL the variables — the particular investment being covered by
this insurance, how long the insurance contract is good for, and even how much money
you want to collect for selling it.

Now, remember what we said earlier: Around 82% of options expire worthless.

Think about it, and you’ll see why.

How many times have you used your auto insurance policy during all the years you’ve

18
had it? And who do you think has gotten the better side of that bargain during all those
years?

The insurance company who sells you the policy, right?

Now to be sure, it IS also possible to make money by buying put options, and sometimes,
some investors do just that.

But based on the numbers, you stand a much better chance of CONSISTENTLY making
money by selling put options.

The unfortunate part is that most investors simply have no idea that this is even possible.

We do. And now, so do you.

Moreover, if you follow Weekend Windfalls, you will never sell puts on high-risk, rotten
companies. You’ll always sell them on the stocks our Weiss Ratings Model has identified
as the cream of the crop.

You’ve seen how this works with Apple.

Now consider this example:

We like XYZ dividend stock that’s currently trading for $16 per share, which you’d be
glad to own on a price dip to, say, $14

Well, instead of just waiting around for a pullback — which is what most investors would
do — you can sell a put option instead.

You sell someone else the right to sell you 100 shares of their XYZ at $14. And again, you
get to decide how long this right is good for — typically one month.

Once you have the specs, you just place this order with your online broker like you do
any other trade. It really is just as easy.

You collect hundreds — or even thousands — of dollars, depending on a number of

factors, including the number of contracts you sell.

That cash is yours to keep no matter what happens next. So immediately,

you’ve already collected a “Weekend Windfall” without having to buy ANY
investment upfront!

And in all but one scenario, you end up keeping that money with no other obligation.

Better yet, you’re free to do whatever you want next.

So, let’s summarize. When done correctly, selling put options …

• Gives you immediate, non-refundable “Weekend Windfalls” payments without

having to buy any stock upfront …

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 • Can be done in a regular brokerage account and in practically the same way that
you currently buy or sell other investments …

• Allows you to know, in advance, every possible scenario that could happen
BEFORE you do anything …

• In all but one outcome, essentially hands you money for doing nothing … and

• In that one scenario, gives you the chance to buy investments that you like at
prices you predetermined were fair. So you should be ready to take ownership of
the underlying stock, too! If that stock goes down further … if you take no
protective action … or if you don’t act on our follow-up instructions … THAT’s
when you can lose money.

How Much Money Should

You Deposit In Your Account?
You have a choice.

Some brokerage firms will allow customers with the appropriate amount of experience
and financial resources to sell puts without putting much money in their accounts to buy
the shares when necessary.

Many investors choose to sell puts this way, putting up only a fraction of the possible
amount that might be needed.

The reason is simple: Assuming you never have to buy the stock (which is the most
common outcome), the money you collect gives you a far-bigger return on your
investment.

To do this, you need a “margin account.” You won’t have to actually use this facility
unless you buy the actual shares, which with our strategy, happens very rarely. But the
broker will still require that you have the ability to use margin if and when you need it.

So, brokers require that you to fill out the needed forms, gain approval and upgrade your
account (even if you never use it).

There are other built-in protections designed to limit/control risk as well. You have to
have a minimum amount of equity in your account when opening a position (called
“initial” margin).

Plus, you need to maintain an ongoing minimum amount of equity that varies along with
the value of that position (called “maintenance” margin).

Page 11 of the TD Ameritrade margin manual gives you an idea of what would be
required to sell puts that are not secured by cash (“naked put selling”).

Essentially, there are three ways to calculate margin requirements, and you would be
restricted to the greatest of the three results. Here are the details:

20
 “Because writing uncovered — or naked — options represents greater
risk of loss, the margin account requirements are higher. The writing
of uncovered puts and calls requires an initial deposit and
maintenance of the greatest of the following three formulas:

a) 20% of the underlying stock less the out-of-the-money amount, if

any, plus 100% of the current market value of the option(s).

b) For calls, 10% of the market value of the underlying stock PLUS the
premium value. For puts, 10% of the exercise value of the underlying
stock PLUS the premium value.

or

c) $50 per contract plus 100% of the premium.”

It is entirely up to you how you want to trade the recommendations you’ll find in
Weekend Windfalls.

Just be aware that using margin involves more risk, and be sure to discuss the issue with
your broker, and read the required disclosures.

Alternatively, if you prefer to avoid margin, you can sell options on a “cash-secured”
basis.

With this method, you simply put up enough money to cover the entire trade in your
brokerage account before you sell the put option. Many brokerages will keep the money
in a separate fund for you so that it is always there until the contract expires. Or as the
TD Ameritrade manual notes:

“Writing a cash-secured put means you are creating an obligation to

purchase the underlying security at the strike price until the
expiration date. The writer of the put options assumes the obligation
to purchase the underlying security if the options contracts are
assigned. If the put-options writer maintains a cash balance equal to
the total exercise value of the contracts, the put contracts are 'cash-
secured.' If the option is assigned, the put-options writer purchases
the security with the cash that had been held to cover the put.”

The bottom line:

As long as you write puts on stocks you wouldn’t mind owning …

And as long as you always have enough money (in your brokerage account or elsewhere)
to cover the potential purchase of the shares, if needed …

Then selling put options with this service is far better — and in many ways less risky —
than buying the best of the best stocks on the market.

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 Part 5
More Info on Selling Call Options
By now, we assume you’re comfortable with the put-selling strategy that’s at the heart of
this service.

Plus, as we explained in Part 2, this service also provides an extra benefit — you can also
generate additional income windfalls by selling call options.

We only recommend selling calls on stocks you already own. The term for this is “selling
covered calls,” or “covered call writing.”

And it’s considered the very safest type of options trading.

Reason: You are merely selling someone the right to buy a security that you ALREADY
own.

The most-conservative way to sell covered calls is at strike prices above the price you
paid for the underlying stock. Doing it this way guarantees that you can only book a
profit in the event that the option is exercised, and it adds no more downside risk than
you had just by owning the shares.

In fact, the premium you collect actually lessens your risk of owning the stock.

To see why, let’s walk through an example:

To keep things simple, we’ll use 100 shares of a hypothetical stock that you just
purchased for $30 a share.

Let’s say you decide to sell a call option that expires one month later with a strike price of
$35. You see that this contract is selling for $1.50. In this case, that means the actual
premium you will collect is $150.

Now it’s just a matter of placing your order, either online or with your broker over the
phone.

Once the contract is created and sold ... you will receive the premium — minus
commissions — in your account. It will show up as a credit to your account.

In other words, as with put selling, you always collect a nice payment immediately. But
your potential profits don’t stop there. The rest of the story can play out in a few different
ways.

Let’s go through each scenario ...

Scenario 1. If the stock price fails to rise above the strike price of the
contract, the investor who bought your call option will let it expire worthless.
You get to keep your stake in the company, plus the money you collected for the

22
 option. End of story.

Scenario 2. If the stock price rises temporarily above the strike price,
but the investor fails to exercise the contract ... same result.

Scenario 3. If the stock price goes nowhere during the life of the
contract ... same result.

Scenario 4. If the stock price only goes down during the life of the
contract. You keep your stake in the company and the money you collected.
Your shares may be worth less on paper, but you’ve realized a gain from the
option contract you sold.

And under any one of these four scenarios, you are now free to sell a new call with a new
strike price and a new expiration date.

You can continue doing this again and again for a continual second stream of income
from your portfolio.

OK, there has to be another scenario, right? Yes.

Here it is ... the absolute “worst case” ...

Scenario 5. If the stock rises above the strike price and the investor
exercises the option before it expires. Then you will be forced to sell your
shares to the options buyer AT the strike price.

This is your only obligation.

You can never be forced to sell the shares at any price other than the strike price.

In other words, the worst thing that can happen with covered call writing is that you will
be forced to part with your shares at the predetermined strike price.

But think about what that means. Essentially, you can potentially collect THREE
SEPARATE PROFITS:

Profit #1: You collect the money from the sale of the option.

Profit #2: You collect any dividends paid before the option is exercised.

Profit #3: Since the strike price is higher than your original cost for the shares
(factoring in commissions), you can book a third profit!

Also, when you sell an option, you do NOT have to just sit there and wait for the contract
to expire …

In some cases, it may make sense to close out the trade earlier.

To do this, you can simply place an order that instructs your broker to “buy to close.”

23
If you’re getting the idea that covered call writing is a great strategy when the stock
market is trading within a range, you’re absolutely right.

And as long as you want to continue holding your shares anyway, it’s also a great strategy
when the market is going down.

What about if the stock market goes up? You can still collect decent returns; it’s just that
your upside will be limited.

Pretty good deal, eh?

We sure think so!

24
 Part 6
How to Place Orders
To be successful as an investor, you can’t just throw darts against the wall. You need a
methodology based on data, thorough analysis and sound research. And that’s precisely
what we aim to provide with Weekend Windfalls.

Our multi-step approach is designed to narrow down the universe of thousands and
thousands of stocks ... and thousands of thousands of options on those stocks ... to a
small group of targets. Then, we only pick the best of the best for the Weekend Windfalls
model portfolio.

How does that winnowing process work? Let’s look at that now ...

1. We start with full Weiss Ratings database of over 17,000 stocks listed in the U.S. and
Canada.

2. We discard all stocks that are not traded on the NYSE, Nasdaq, Amex or Over-The-
Counter markets. This is an important filter.

3. We avoid all stocks with fewer than 50,000 shares in average daily trading volume or
with market capitalizations of less than $50 million. This ensures we don’t target
stocks that are illiquid or too tiny.

4. We cut out all stocks with Weiss Ratings of “D+” or lower.

5. We discard all stocks whose trailing 12-month dividend yields are not at LEAST
equal to the dividend yield of the S&P 500. In a service focused on generating
income, we don’t want stocks that pay below-market yields.

6. We also discard stocks whose trailing 12-month dividend yields are more than four
times the dividend yield of the S&P 500. Reason: They’re almost invariably stocks
whose yields re too good to be true. Sure, their yields are extremely generous NOW.
But those dividends are probably unsustainable, and when they’re forced to cut their
dividends, the stock price could suffer, too.

7. We choose stocks that don’t have total open interest in their front-month options of
at least 2,500 contracts. This filter helps ensure that their options are also liquid.

8. We rank the stocks in descending order by implied volatility (relative to where it’s
been in the past 12 months) — called IVR. All else being equal, you want to sell put
options on stocks with higher IVR.

9. We seek to sell puts with strike prices one standard deviation away from the current
trading price on one of the top five companies identified by the screening process.

10. In the event a stock is put to us, we will look to write covered calls with strike prices
that are one standard deviation above the current price.

25
 Now, let’s talk about
actually placing orders …
Like stocks and ETFs, options trade under symbols. But options symbols are a bit longer
because they convey more information.

Plus, as we discussed earlier, there are different ways to sell options — either cash
secured or on margin.

We recognize that your choice will depend on how much money you want to make and
how much risk you’re willing to accept.

With that in mind, here is a sample recommendation to illustrate what our actual orders
will look like and why:

Recommendation Details:

Sell to open 1 February 2020 Walt Disney put option with a strike price of $140.00
Reco Symbol: DIS200221P00140000

Income Generated: $226 (1 contract X $100 multiplier X $2.26 premium)

Safer, More-conservative Cash-secured Option Funds Required Per Contract Sold:

$14,000

Higher-Risk/Potential Return Margin Option Funds Required Per Contract Sold:

$5,156*

Number of contracts to generate approximately $1,000: 5

If you want to call your broker with this order, here’s what you would say:

Sell to open 1 of the Walt Disney (DIS) February 21, 2020, put
options with a strike price of $140.00, symbol
DIS200221P00140000, for no less than $2.26 per share or $226 per
contract. Use a limit order and don't chase the market.

So, let’s cover what this order language means.

Sell to open is straightforward. You aren’t buying anything here. You’re opening a new trade
by selling a put option on shares of DIS.

February is the expiration month (options typically expire on the third Friday of each month).
So, in this case, the put option expires on Feb. 21.

$140 is the strike price — the price you agree to pay for DIS shares in case it comes to that.

DIS200221P00140000 is the option contract’s ticker symbol.

26
For no less than $2.26 per share or $226 per contract is the amount you aim to collect
when you initiate the trade. This is the price you should use to enter a limit order on your
broker's platform.

While our order language will describe the sale of a single contract, feel free to adjust that to
reflect your personal preferences and the size of your portfolio.

Plus, we’ll always let you know how many contracts you’d have to sell to generate
approximately $1,000 in income.

Also, note the two lines indicating how much you’ll need in your brokerage account to execute
the trade on a

• cash-secured basis, or

• margin account basis.

Some important points:

First, it always requires more funds on hand to sell options on a cash-secured basis. But that’s
the most conservative way to do it.

Second, if you use leverage, the amount we show is actually HALF the minimum amount we
estimate that your broker would likely allow. That is because we like to err on the side of caution
and we feel this is the way to do it with a good measure of prudence.

To see the minimum standards allowed by comparison, you can use something like the CBOE’s
margin calculator tool. It is available online here.

Third, the figures listed are based on the sale of one contract. If you sell more contracts to
generate more income, you’ll need more funds on hand.

To be clear, this is just an example. Check your inbox for timely trading instructions, and
we will track those new positions together in future issues.

Estimated Funding Requirements

Without a margin account, we estimate that the required cash deposit per contract would
be an average of approximately $6,000 for one position and $30,000 for all positions
held simultaneously at any given time.

With a margin account using double the required margin (half the maximum leverage),
we estimate the cash needed per contract would be less than $2,000 per trade and under
$10,000 for all positions held at any given time.

As with any investment strategy, the more one invests, the more one can make. For
example, in order to collect an average of $500 in premium per trade, we estimate
investors would probably need to fund their account with approximately $69,000.

And in order to collect an average of $1,000 per trade, they would probably need to fund
their account with an estimated $138,000. And with larger investments, they could earn

27
proportionately more.

Our view: Do not get hung up with the $1,000 per trade. That’s an illustration, not a
golden rule.

Instead, investors should focus instead on the yield. Whether you invest $10,000 or $1
million, you’re looking at an average of close to 1% per week or double that in two weeks.
And that’s without reinvesting your gains.

One Last Reminder

About Options Orders
You do NOT have to just sit there and wait for an option you sold to expire!

In some cases, it may make sense to close out the trade earlier — either to lock in profits
or to protect against losses.

To do this, you can simply place an order that instructs your broker to “buy to close”
(in the case of options writing) or “sell to close” (in the case of options buying).

Basically, you’re going out and purchasing or selling the exact same contract you
previously sold or bought. And in doing so, you are canceling out any future obligation
you had.

We’ll give you specific instructions as needed. No worries!

28
 Part 7
Getting Started and
What to Expect
As you’ve seen, there are many reasons to be excited about the prospect for pulling
repeated Weekend Windfalls out of the market in the months and years ahead.

Here's how you to get the most out of this service.

MEMBER BENEFIT #1:

Weekly Trading or Update Issues

The goal of this service is to help you generate repeated Weekend Windfalls by selling
put options (and sometimes covered calls) on attractive, highly rated, higher-yielding
stocks.

So, nearly every Friday morning, you will receive an issue pointing you to

• A recommendation to open a new position, plus

• Sometimes a recommendation to close out existing positions, plus
• Details on your current holdings.

Once you decide that a trade is right for you, you will have all the information you need
on what option to sell, why to sell it, what limit prices to target, and so on.

You'll get step-by-step instructions on how to make the trade online or on the phone with
your broker. If you like, you could simply call your broker and read the Trade Alert aloud
on the phone.

Ditto when it's time to close out positions. We'll make sure you have everything you need
to make the trade quickly, easily and with confidence. Plus, we'll use this forum to
answer the questions we get most often from members like you.

MEMBER BENEFIT #2:

Special Members-only Flash Updates

As you know, the financial markets don’t abide by a regular monthly or weekly
publishing schedule. One moment, they can be relatively quiet and tame; the next
moment, they can explode dramatically.

So, as a VIP member, we will send you flash updates WHENEVER we see a major move
in the making that could impact your existing positions. The goal is to make sure you’re a
fully informed investor, ready for whatever may come your way.

Coming Soon
MEMBER BENEFIT #3:
Options Video Masterclasses

In these deep-dive video training modules, we won’t just reveal the secrets behind our

29
Weekend Windfalls methodology. We will also show you how we select the very best
options to trade, how the options market works, and so much more. The goal is to help
you understand the intricacies and mechanics of writing options to generate substantial
payouts over time.

MEMBER BENEFIT #4:

24/7 access to your
Members-only Website:

You get 24/7 access to your exclusive members-only website. Here, you have access to a
number of tools, including ...

• Open Position Monitor, which lets you see how all the investments you own are
performing ...

• A Complete Archive of all your issues, alerts and other items we'll send your way.
If you ever miss or delete an e-mail, you can find it online at any time.

• And an Editor's Mailbag where you can ask us any question you like about
Weekend Windfalls anytime you like. We can't give you advice that's tailored to
your financial situation, age, family commitments or other personal
circumstances. But we will do anything we can to help you and other subscribers
to get maximum value out of our service.

The Web site is available at https://wwf.weissratings.com, and your username and

password can be found in the welcome e-mail you’ve received.

(Click here if you need to create or reset your password.)

IMPORTANT NOTE ON EMAILS

FROM WEEKEND WINDFALLS

You can expect to receive updates at least weekly, and more frequently as needed.
Sometimes those updates will be actionable, so we want you to read those right away.

And occasionally, we may update you with a move to make beyond those regular
updates. These Trade Alerts can arrive at any time during normal trading hours,
depending on market conditions.

To make sure you don't miss out on a single update or move to make, add these emails to
your personal e-mail address book:

• [email protected]
• [email protected]
• [email protected]

You can find specific, step-by-step instructions on how to do so here:

https://issues.weissratings.com/whitelist

30
 MEMBER BENEFIT #5:
Exclusive Concierge Service

You are a Very Important Person in our book — and we've made sure you'll get the
personal, kid-glove treatment every step of the way. We can’t give you personalized
investment advice. But we can certainly answer any questions you may have about what’s
happening and what we’re recommending in our issues or alerts.

Our professionals are on standby to assist you. So, feel free to contact us if you have any
questions related to this service, such as:

• How the service works

• Understanding trading instructions

• Receiving your issues by e-mail

For any questions about your subscription — renewals, changes of address, etc., there are
two ways to reach us:

1. Phone is the best way to reach us for routine questions about your account
and non-receipt of Weekend Windfall issues. Please call our Customer Care
center at 877-934-7778.

2. You can also email us at [email protected].

Some pointers …
1. To avoid delays in responding to your questions or processing your requests,
include the name of this service — Weekend Windfalls — as well as your full
name.

2. If you are changing your e-mail or mailing address, please include both your
current and new information.

3. To temporarily suspend service for any reason, please e-mail us the date you wish
to suspend service and the anticipated date you expect to resume the service.

4. You also have an Editor's Mailbag where you can share your feedback at any time.
You can access it through your members-only website here.

31
 Part 8

Frequently Asked Questions

Q: “Why haven’t I heard about the Weekend Windfalls you can receive
from writing options before?”

A: Probably because a lot of people don’t even realize it’s possible. And those who do
pursue this strategy go about their business rather quietly.

We also suspect that plenty of brokers don’t quite understand the strategy themselves.
It’s much easier to hand you a hot new stock recommendation than to help you sell
options.

Lastly, for many people, professionals included, options are greatly misunderstood.
They’re viewed as all-or-nothing bets. They’re considered tools for speculators, not as
essential staples for income investors.

But nothing could be farther from the truth. Like any broad investment category, there is
a whole host of ways to use options for conservative purposes, with minimal risk and
plenty of profit potential.

Q: I like the concepts you’re discussing, and I’m eager to get started. But I’d
really like some additional information on how to do this.

No problem. You can find plenty of information on options in a number of places.

For example, many brokerage houses conduct online webinars that will give you more
details on how to get started selling cash-secured puts or writing covered calls.

You can also visit the Chicago Board Options Exchange’s website. It is full of terrific
information. You should also take a look at Characteristics and Risks of Standardized Options
(the options disclosure document, or “ODD”) available here.

Q: I just joined Weekend Windfalls today. Where do I find what positions

you are recommending be considered now? Or should I just wait for e-mail
updates?

A: You can expect to hear from us at least once a week. We'll give you our current outlook
on the financial markets ... our take on what's happening in the world and how it can
impact income-generating stocks and the options market ... our technical outlook for the
broader markets in general ... and our updated outlook on current positions.

For an updated look at current recommendations, you can check out our position tracker
here: https://wwf.weissratings.com/wrl/wwf/position-tracker. Prices are updated every
evening around 6 p.m. Eastern.

Q: I missed a trade opportunity. What should I do to catch up?

A: Options prices change frequently. Options tend to make larger percentage moves day-
to-day than underlying stocks. The options we recommend are relatively shorter-term in

32
nature. And the service is designed to provide new recommendations as often as once a
week.

So, we recommend you avoid buying previously recommended positions at the prices
laid out in previous issues. There will always be new trading ideas coming down the
pipeline, and it may often be in your best interest to wait for the next idea.

Q: Will I be able to trade options easily?

Every broker is different. But generally speaking, writing covered calls and/or selling
cash-secured puts are considered lower-risk options strategies. While you will need some
level of stepped-up approval (vs. what you would need to just buy and sell stocks or
ETFs) to participate in this service, getting that approval shouldn’t be an onerous
process.

If you choose to sell options using margin vs. on a cash-secured basis, you will likely
need a higher level of approval from your broker. You will also need to get approved for a
margin account. Expect to file additional paperwork in the process.

33