On May 23rd I sold a Naked Call on YELP. I sold 10 contracts of the YELP $25 Calls to expire May 27th. YELP started getting upgrades from multiple banks and the stock has been moving up. On Expiration Day I had to do a Roll Out because the stock was In-the-Money. YELP has been moving so good I had to do another Roll Out. With the stock moving down as a result of the Brexit, today I had an opportunity to get out of this “Active Roll Out” position, so I got out! This Roll Out position involved 6 trades. I’m glad to get out because I think the market’s going to recover and I didn’t want to continue Rolling. After all is said and done I was able to get out with a profit. It was a small profit, but it was a profit! Any time I end a position and I didn’t lose money I’m happy! Below is a copy of all the trades, the last being the trade I just made to finalize the position.
5/23/16 – Sell to Open 10 YELP 5/27/16 $25 C @ $.65 (+$650) Closed – Rolled Out
5/27/16 – Buy to Close 10 YELP 5/27/16 $25 C @ $.87 (-$870) Closed -$220
5/27/16 – Sell to Open 10 YELP 6/17/16 $26 C @ $1.00 (+$1000) Roll Out
6/17/16 – Buy to Close 10 YELP 6/17/16 $26 C @ $1.00 (-$1000) Closed
6/17/16 – Sell to Open 10 YELP 7/1/16 $26.50 C @ $1.20 (+$1200) Roll Out
6/27/16 – Buy to Close 10 YELP 7/1/16 $26.50 C @ $.85 (-$850) Closed
I know this can be confusing so any questions please email me. The bottom line is, if you add up all the money figures I received as premiums, and money I spent to close a position, the final total is +$130. This is another example of how a Roll Out prevented me from losing money. As I said, this isn’t the best outcome but I didn’t lose money. I’ll take it!
Total Profit +$130
This money is not going in the mattress. Tonight I’m going out to dinner!
Steve
The Options Coach