Rattle and Hum
Footballguy
I am starting this thread to learn and discuss trading options that trade on the CBOE (calls and puts). I invite anyone to share their plays. Please include current stock/etf price, call or put, strike, expiration date, premium paid/received, and a blurb about why you are considering the trade. I'll try to update this first one that I post below and hope others will do the same.
7/2: Filled at 52.90 and 6.10 on the call.
7/5: BTC 9/21 $50 Call. STO 8/17 $50 call -$1.00 (total collected $5.10)
7/12: BTC 8/17 $50 Call @$6.25. STC 100 sh MU at $55.21. Only made $108.32 after fees (2.3% cash return; 83% apy). I got out since stock seemed to be moving north and I want to practice adjustments.
MU (Micron Tech): $52.45 Neutral bias- Sell in-the-money covered call
Buy 100 shares at $52.45. Sell (also referred to as "write") 1 9/21/18 exp, $50, Call, for $5.80 (1 contract = 100 shares).
The break even on this trade is $46.65 (stock price minus premium received for selling call). The max gain as-is will be 7% cash on cash (28% apy).
This can be done in cash, margin, or most IRA accounts. Commissions not included. This would be $12 with my broker assuming I get stock called away at $50.
Notes:
- If MU is above $50 on 9/21/18 I will only make $335 (7.2% return in 3 months; 28% apy) as stock will be taken away at $50. $3.35 difference between my break even and $50/share X 100 shares.
- If MU is below $50 on 9/21/18 I can sell another call to collect more premium, lowering my cost basis on the stock even more.
- If MU falls substantially before 9/21/18 I can buy the $50 call back and sell a lower strike call.
Anyone else?
7/2: Filled at 52.90 and 6.10 on the call.
7/5: BTC 9/21 $50 Call. STO 8/17 $50 call -$1.00 (total collected $5.10)
7/12: BTC 8/17 $50 Call @$6.25. STC 100 sh MU at $55.21. Only made $108.32 after fees (2.3% cash return; 83% apy). I got out since stock seemed to be moving north and I want to practice adjustments.
MU (Micron Tech): $52.45 Neutral bias- Sell in-the-money covered call
Buy 100 shares at $52.45. Sell (also referred to as "write") 1 9/21/18 exp, $50, Call, for $5.80 (1 contract = 100 shares).
The break even on this trade is $46.65 (stock price minus premium received for selling call). The max gain as-is will be 7% cash on cash (28% apy).
This can be done in cash, margin, or most IRA accounts. Commissions not included. This would be $12 with my broker assuming I get stock called away at $50.
Notes:
- If MU is above $50 on 9/21/18 I will only make $335 (7.2% return in 3 months; 28% apy) as stock will be taken away at $50. $3.35 difference between my break even and $50/share X 100 shares.
- If MU is below $50 on 9/21/18 I can sell another call to collect more premium, lowering my cost basis on the stock even more.
- If MU falls substantially before 9/21/18 I can buy the $50 call back and sell a lower strike call.
Anyone else?
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