This Tuesday, Oct. 18th I sold a Call against my 5000 shares of Micron (MU). This was a 50 contract $18 Call to expire next Friday, Oct. 28th. I received a premium of $.20 (+$1000). This morning with the market and Micron down a little I decided to lock is some profit. The premium was down to $.14. If I see an opportunity to get out of a trade early with one half of the profit, I like to do so. Being only 2 days into the trade and 9 days to expiration I seen a possible nice opportunity. The premium was down to $.14 and the market moving down, I put in a “Buy toClose” order for $.09. It the premium got to $.10 it would have been one half the premium. I figured if the premium got down to $.09, I would get half the profit locked in plus the extra $.01 would pay my commissions. My order was executed and I am out of the position with a $550 2 day profit. I love it! Here’s the buy order:
Buy to Close 50 MU 10/28/16 $18 C @ $.09 (-$450)
Profit +$550
I’m not projecting a big gain for this week. If I get a good opportunity to lock in some cash and get it in my mattress I do it. Taking profit in the game we’re in. The original trade was to go toward next weeks profit but now that I exited it will go toward this week.
Steve
The Options Coach