Another great week! In fact the best week this year for me. When you look at my results you are going to say, WOW! But there’s a few positions I’m worried about. 1 is with Facebook (FB) and the other is with U.S. Steel (X). It could work out that I give some of this weeks profits back to my opponent, Wall Street. I hope not, but only time will tell. I will explain all this weeks trades below and when writing about FB & X I will get into my concerns.
All the trades exited this week involved Go Pro (GPRO), Netflix (NFLX), U.S. Steel (X) and Facebook (FB).
GPRO
First let’s take a look at GPRO. In early January I bought 2000 shares of GPRO to cover a Naked Call. The stock was moving up approaching my Strike Price and I had to cover the Call. I ended up buying the stock at $19.89 to cover a $20 Call. As soon as I bought the stock it reversed down and in the next few days it was down to the $11 range. At this point that Call expired and I kept the premium but I was stuck holding the stock at a much lower price. In this situation I had 2 choices. I could sell the stock at a huge lose or I could hold on for it to recover and sell some Calls to bring in some premium money. I did the latter. I sold a 4/15/16 $17 Call and brought in an $1100 premium. With the stock moving a little but well below the Strike Price, it expired yesterday.
Expired 20 4/15/16 $17 C
Profit $1100
I still own the stock and sold another 20 contract Call expiring 7/15/16. That premium was $1400
NFLX
I previously owned 1000 shares of NFLX which I bought for $104.71. On Monday 4/11 I sold 10 contracts of the $105 Calls expiring yesterday. This Call had a premium of $1.70 for a total of $1700. The stock made a big jump this week and I was assigned on my stock at $105 and the Call expired so I keep the premium of $1700. Please go to the blog post named “Stick to your guns.” In this post I explain the “Opportunity Lost” I had in this trade. I do not worry about the Opportunity Lost, look at the week I had sticking to my guns.
Sell 1000 shares NFLX @ $105
Profit +$290
Expired 10 NFLX 4/15/16 $105 C @ $1.70 (+$1700)
Profit + $1700
Total Covered Call Profit +$1990
X
On Monday 4/4 I bought 5000 shares of U.S. Steel at $16.85. On Tuesday 4/12 I sold a Covered Call. 50 contracts of the 4/15/16/$18 Calls and got a premium of $.30 for a total of $1500. The stock just kept going up and yesterday is closed at $19.24. I was assigned the stock at $18 for a profit of $1.15. on 5000 shares thats $5750. Great trade!
Sell 5000 shares X @ $18
Profit +$ 5750
The Call I sold on X Expired.
Expired 50 X 4/15/16 $18 C @ $.30 (+$1500)
Profit +$1500
Total Covered Call Profit +$7250
Above I mentioned a potential problem with U.S. Steel. This week I felt X was going to come down after a big jump. On Monday, 4/11 I sold 50 4/22/16 $17 Naked Calls. I still hold these Naked Calls with the Strike Price of $17 to expire next Friday and the stock is up to $19.24. If the stock stays above $17 I have to deliver 5000 shares on Friday 4/22. This could get interesting. Stay Tuned!
FB
For my last position of the week I did a Covered Call on previously owned 1000 shares of FB. On 4/5 I bought the 1000 shares of FB and sold a Call. That Call expired and on Tuesday the 12th I sold another Call. I sold 10 4/15/16 $113 Calls and got a premium of $.50 for a total of $500. I did not get assigned on these shares because FB went down a bit and closed at $109.64 yesterday. The Call expired and I still own the 1000 shares.
Expired 10 4/15/16 $113 C @ $.50 (+$500)
Profit +$500
This is another position I’m worried about. I bought the 1000 shares at $113 and it’s down to $109.24. I don’t like the way FB has been moving and I’m getting a little concerned because earnings are coming and I’m down over $3. Right now the stock is down $3760 from where I bought and if they don’t hit the analyst estimates the stock can take a bit hit. I will be watching and worrying.
Total Weekly Profit +$10,840
Have a nice weekend!
Steve
The Options Coach