This little fella popped up on my radar earlier today as having high implied volatility, so I pretty much blindly put on the covered call then and there, buying 100 shares a 6.24 and selling the Sept 16th 7 put for a 5.77 debit (which will be my cost basis in the shares).
The max profit is $123 with a ROC of about 21.3% (assuming a call away at 7).
The max profit is $123 with a ROC of about 21.3% (assuming a call away at 7).
Comment:
Now that I look at the chart, it looks like I "Cramered" this, taking a position at the top of the key ... . Lol.
Comment:
Darn thing hasn't moved much since I put it on. Running into expiry of the Sept 16th short call, I'll be looking to take that off for near worthless (.05 or less) and sell calls against in the Oct 21st expiry.
Comment:
Covering here for a 6.41 credit on this bounce, yielding a net profit of $57 per contract/100 shares
Comment:
9.9% ROC, which is generally what I shoot for in these (10% ROC or better).