I just got back to my computer. My wife had surgery on Monday for a torn meniscus and today she started physical therapy. Before I brought her I put in 2 orders. I was executed on both. I’m sorry I wasn’t near my computer to report when they were executed but we must take care of family.
This week I had 3 positions I was concerned with. All were reporting earnings this week. I had 5000 shares AK Steel (AKS), I had 1000 shares of Facebook (FB) and I had 50 contracts of Naked Calls on U.S. Steel (X). I’ll go over each position and what I did with them today.
AK Steel
On 4/21/16 I bought 5000 shares of AKS to cover a Naked Call position. I had a $5 Call sold and I bought the stock at $4.95. This past Friday that Call expired and I was not assigned because the stock closed below $5 on Friday. I really wanted to get assigned so I didn’t have to hold the 5000 shares thru the earnings announcement. The stock stayed below the price I bought so I held on, hoping for a good report. The report was good but it didn’t move the stock too much. Today the stock was moving around a bit and I no longer want to hold the position. I’m still waiting for the steel industry to have a pull back plus AKS no longer has premiums I like after earnings. I put in an order to sell my 5000 shares with a limit order at $4.96. I put the order in at this price because I got in at $4.95 and I just wanted out, I figured I’ll try and get $.01 out to pay for commissions. I was executed at $4.96 which is where the stock closed. I initially bought the stock to sell a Call. I sold the Call and brought in $1000 with the Call expiring this past Friday, plus the $.01 on the stock. This deal is over and it looks like I’ll be out of AKS for a while. I no longer like the premiums. Here’s the sell order:
Sell 5000 shares of AKS @ $4.96
I’ve been in and out of FB for a while now. Currently I own 1000 shares which I bought on 4/5/16. The stock had a bit of a pull back, so this week I didn’t get to sell a Call. I’m quite happy I didn’t! I love FB so when it was down this week I had no problem holding it thru earnings which were announced after the close today. I own 1000 shares with no Call attached to the stock and the earnings crushed the estimates. I bought the stock at $113 and after the close the stock is up $10. Tomorrow morning, if all stays the same, at the open my account will go up $10,000.
U.S.Steel
I have 50 contracts of the $18 Naked Calls expiring in June. Today X did not hit their number and the stock was down most of the day. When you have a Naked Call, this is a good thing. Today with the stock not looking like it will go up I sold another Naked Call. I sold 100 contracts of the $19 Call expiring this Friday. I brought is a premium of $.25 for a total of $2500. I now have 150 contracts of Naked Calls on X and I need the stock to go down. At least not go up to my $19 Strike Price by Friday. After the close the stock went up to $18.61. I have 2 days left. I will be watching very closely. If the stock gets up near the $19 area I’ll have to buy 10,000 shares to cover this Call. This trade is a Naked Call with the stock moving up; I’ll give this a Risk Factor of 5. This can be very dangerous. Here’s the sell order:
Sell to Open 100 X 4/29/16 $19 C @ $.25 (+$2500)
I would love to see FB go up another 10 points tomorrow. A few stocks had good earnings today, FB being the big one. I look for the market to go up tomorrow. I’ll have to watch U.S. Steel extra closely because of my Naked Calls.
Steve
The Options Coach