This is a continuation of long-running trade that I kicked the can on. (See Post Below).
With price finishing the day wayyy below my 10 short put, I will find shares in my account next week via assignment. In anticipation of that occurring, I previously sold a February 21st 5.5 call and have a cost basis of 5.22. I'm fine with being called away at 5.50 should...
Posting a revised visual depiction of this trade (see Post Below) showing the 80 short call strike that covers the stock, plus the December 20th 115 short call I sold against on the post-earnings pop to $90 or so, along with my cost basis.
With price breaking my short call here slightly, I may add short call to cut net delta in the position, particularly given...
I got this stock when it was assigned to me at a landed cost of $3.65 and today on this 20% pop I sold 6 strike calls for 60 cents so this either reduces my landed cost to $3.05 or gets me out at equal to $6.60 for very close to a 100% gain
Entered a position with the large gap down and apparent "trap" in the following days. Only long 100 shares, will look to add at the green levels and trade around a position. Selling the CC is over earnings if it gaps up and gets called away fine otherwise helps the DCA a little bit.
... for a 3.22 debit.
Max Profit: $78/contract
Max Loss/Buying Power Effect: $322 per contract
Break Even/Cost Basis: 3.22/share
Notes: A speculative shot on a high implied volatility biotech underlying ... .
... for a 10.02/contract debit.
Max Profit: $98/contract
Max Loss: $1002/contract
Break Even/Cost Basis: 10.02/share
Notes: High rank and implied (84/57). Going with the cost basis reduction setup without a timer on it ... .
... for a 9.26/contract debit.
Max Profit: $74/contract
Max Loss: $926/contract
Break Even/Cost Basis: 9.26/share
Notes: Going directly to a monied covered call in this high implied volatility underlying (121%) with a mildly bullish delta metric. Now that I look at it, the 10 short put (25.78 delta) in October has a better max (1.03)...
Opened a 'poor mans covered call' on GLD.
Going long on this alternative asset class to diversify the portfolio. My overall bias is higher gold based on the technical price trend since 2016 and expect we'll soon see a reversion towards the mean/median price range.
Bought the OCT 112 CALL at 86 deltas, 105 days to expiration as a stock replacement for 8.12
... for a 29.39/debit per one lot.
Max Loss: 29.39 per contract on setup
Max Profit: 1.61 per contract on setup (5.48% ROC)
Break Even: 29.39 on setup
Notes: Roll the short call out on significant loss of value,* to maintain the desired net delta of the position, and/or to defend the break even. I would note a couple of...
Rather than just holding HPQ stock with hope that it may go higher this year, collecting a 2.5% yield while waiting, I instead plan to sell options premium this week against my $22 cost basis for a higher return on capital. Implied volatility on HPQ is over 30% and rising as we near the earnings report date of May 29 after the close. Of the past 8 quarterly...
Bought two lots of SLV at 15.74 and sold June 16 calls for 38 ea (45 delta strike). The IV was >20% today.
The position break even is reduced to 15.36 with a 4% max profit on the break even cost.
At 60 days to expiry, this yields 25% at an annualized rate.
Ideally the cost basis on the position can be further reduced after June with additional calls sold...
Going monied, small on this beaten-down brick and mortar ... . Looking for a minor seasonal bounce.
Probability of Profit: 60%
Max Profit: $25
Max Loss/BPE: $3.25
Break Even: 3.25
* -- Options For the Small Account
I have touched on this topic before in separate posts, but thought I'd refresh the notion of what I like to call "strategic acquisition" here, since I get repeatedly asked about how I go about acquiring shares in an underlying I actually really do want to buy and hold, usually for an indefinite period of time (we're talking years here). The focus of these...
SOLD -1 GILD 100 17 NOV 17 90 CALL @1.00
Adjusted Cost Basis $87.70
Just a few hours ago I didn't see any chance of turning a profit on this investment any time soon. Unexpectedly the stock rallied over 7% today (now up 25% off lows) and above the average year end analyst target.
- With selling off the 'unlimited upside', if GILD is above...
I'm fading the Ackman dumpage here with a small position bet that price will stay clear of $10 through April 21st expiry ... .
Bought 100 Shares
Sold April 21st 10 Call
Whole Package: 9.38
Max Profit: $62 per 100 shares/contract
Max Loss/BP Effect: $938 per 100 shares/contract