Results Week Ending 11/20/20
This was a pretty crazy week for me. Last week I wrote I was gonna try to be very careful for the remainder of the year, but I still felt, even being careful I could still do 10K a week. On Monday and Tuesday, while planning my weekly strategy with my 2 big positions, Zoom and Peloton down considerably from where I bought, I saw my goal would be a challenge. Tuesday I resigned to the thought that I would only be able to do about 5K this week. This was being very careful.
While staring at my screen good trades started jumping out at me. Whether getting into new trades or realizing current positions were ready to be cashed in. I cashed in on 2 positions I was holding from before this week. A 1 contract LEAPS option with Tesla and a 5 contract Long option with Square. Tesla I was in for 2 months and I made $2500 and Square I was in for 10 days and made $1300.
Many of the other positions that gave me such a great week I entered, on or after, Tuesday. The thought of a 5K week quickly dissipated and I ended the week with a profit of $17.320. Don’t get me wrong 5K would have been a great week, but I’m working on my strategy & goals for 2021 and it’s nice to see I was able to achieve my 10K goal for the week.
One of the strategies I’m working on for 2021 is using more Short positions to hedge my account. I’m not a big fan of Shorting stock because of the risk, but if a good opportunity presents itself I will do it in preparation for 2021. You will see me Shorting some small positions in the coming weeks for practice. I’m hoping to find positions that are completely overbought. Stocks with their Relative Strength Index (RSI) above 70, along with other indicators.
If you stay up with my post you probably noticed I sold a few Naked Calls this week. When selling Naked Calls you enter a complete Short position. With Covered Call you own the stock. Your stock position is Long and the Call you sold is Short. If the stock goes down you make money on the Call but you lose money on the stock. With a Naked Call, when the stock goes down you only make money. You do not own the stock.
This week I entered 3 Naked Calls, which are listed below. (2) 10 contract Call with Micron and a 10 contractCall with Nikola. This coming week I feel the charts show that Micron will go down. I may practice shorting the stock with 1 or 2 hundred shares.
As my account grows I feel I must get into more Short position for hedging. A big downturn can put me in a bad position requiring a lot of time to recover.
Let’s take a look at this week’s trades.
Tesla
This is the LEAPS option I still owned from the split.
9/3/20 – Buy to Open 1 TSLA 6/17/22 $420.00 C @ $170.00
11/18/20 – Sell to Close 1 TSLA 6/17/22 $420.00 C @ $195.00
Profit $2500
Square
Sold a 5 contract Call I bought 10 days ago.
11/9/20 – Buy to Open 5 SQ 6/18/21 $185.00 C @ $32.00
11/19/20 – Sell to Close 5 SQ 6/18/21 $185.00 C @ $34.60
Profit +$1300
Square
A Covered Call I was assigned on. Big profit on the stock and a big premium. This was a great 3 day trade. This is one of the trades that moved me from a 5K week to over a 17K week.
Assigned Covered Call
11/17/20 – Buy 1000 Shares SQ @ $179.88
11/20/20 – Assigned 1000 Shares SQ @ $185.00
Profit +$5120
11/17/20 – Sell to Open 10 SQ 11/20/20 $185.00 C @ $3.50 (+$3500)
11/20/20 – Expired 10 SQ 11/20/20 $185.00 C
Profit +$$3500
A Covered Call I was not assigned on. I’m in good shape because the stock closed above my buy-in price. Hope to get another Call sold on Monday. This was a great premium on 20 contracts. I also bought another 2000 shares during the day on Friday. I didn’t get to post it but I bought 2000 shares at $18.95. I’ll be selling a 40 contract Call on Monday.
11/17/20 – Sell to Open 20 PLTR 11/20/20 $18.50 C @ 55¢ (+$1100)
11/20/20 – Expired 20 PLTR 11/20/20 $18.50 C
Profit +$1100
Zoom
While my current shares were too low to get a Call sold I bought another 100 shares to sell a Call. It was assigned.
Assigned Covered Call
11/17/20 – Buy 100 Shares of ZM @ $403.00
11/20/20 – Assigned 100 Shares ZM @ $405.00
Profit +$200
11/17/20 – Sell to Open 1 ZM 11/20/20 $405.00 C @$11.50 (+$1150)
11/20/20 – Expired 1 ZM 11/20/20 $405.00 C
Profit +$1150
Zoom
Zoom was moving nicely this week so I bought another 100 shares of a Covered Call. It also was assigned.
Assigned Covered Call
11/11/20 – Buy 100 Shares ZM @ $409.50
11/20/20 – Assigned 100 Shares ZM @ $410.00
Profit +$50
11/18/20 – Sell to Open 1 ZM 11/20/20 $410.00 C @ $3.50 (+$350)
11/20/20 – Expired 1 ZM 11/20/20 $410.00 C
Profit +$350
Zoom
With Zoom moving I was able to get a Call sold on my original 400 shares. Not a normal Zoom premium but I had to go out on the Strike Price in the case the stock kept climbing. I wanted a Strike above where I bought in. 400 bucks, not bad!
11/18/20 – Sell to Open 4 ZM 11/20/20 $510.00 C @ $1.00 (+$400)
11/20/20 – Expired 4 ZM 11/20/20 $510.00 C
Profit +$400
Micron
One of my Naked Calls. The stock didn’t close above my Strike Price.
11/16/20 – Sell to Open 10 MU 11/20/20 $62.50 C @ 50¢ (+$500)
11/20/20 – Expired 10 MU 11/20/20 $62.50 C
Profit +$500
Micron
Another Micron Naked Call that expired.
11/16/20 – Sell to Open 10 MU 11/20/20 $63.00 C @ 65¢ (+$650)
11/20/20 – Expired 10 MU 11/20/20 $63.00 C
Profit +$650
Nikola
Another Naked Call that expired.
11/18/20 – Sell to Open 10 NKLA 11/20/20 $29.00 C @ 50¢ (+$500)
11/20/20 – Expired 10 NKLA 11/20/20 $29.00 C
Profit +$500
Total Weekly Gain +$17,320
After the vaccine was announced the COVID stocks dropped. I’m holding Peloton and Zoom that fit into that category. Both are bouncing back nicely.
Have a great weekend!
Successful trading,
Steve
The Options Coach