I’m a little concerned with my U.S. Steel (X) position. I have 100 Naked contracts sold of the $19 Calls expiring today. If the stock closes above my $19 Strike Price I have to deliver 10,000 shares at $19. As I write the stock is at $18.90 but is has already been up to $19.48 today on a down day. The stock has been moving up nicely (if you own shares). Which hurts my position. A few minutes ago it dropped down to the $18.70 area but it looks like it might hit support at this level. I decided to play it a little safe and I bought 5000 shares at $18.70. At this point I have half my position covered, which makes me feel a little better. If the stock goes above the $19 point I have half my position covered and if it stays below the $19 point I still have 50 contracts Naked, which will increase in value. Depending on which direction it goes and closes at I’ll make another adjustment move. I like where I am right now. Here’s the stock buy order:
Buy 5000 shares X @ $18.70
As I hit the button to post this the stock is at $19.25. This can get interesting! But we have a long way to closing.
Steve
The Options Coach