How to generate cash flow from PUT options

Hey guys, Greg @marketreport

I came across this concept the other day where you can generate Cash Flow with options, and I found this really interesting.

With Greg @marketreport we are learning how to position ourselves to take advantage of market movements.

Here we generate cash flow using options.

Let me jump into an example:
Let's say stock XYZ trades between $10-20 dollars, and it's at $11 right now. I can SELL a PUT option at let's say $9, for $1 per option (the option fee). Keep in mind 1 option contract is for 100 shares. By selling the put, I sell or make the promise that I will buy the stock at $9 (so for 1 option at 100 shares, this is $900 here).

If the stock price never goes down below $9, this option expires and I pocket the option fee, e.g. $1 x 100 = $100.
This is what I want. My promise generated the $100 cash flow.

Even better, if I wanted to own this stock at $9 to begin with, I got it at the price I wanted.

Keep in mind that for the option fee, you make a promise that you have to keep. So if this stock goes to $8, then you're down $100 because you now own stocks worth $800, but had to buy them at $900.

Please share your thoughts and comment.