Last Thursday on Oct 20th I sold a 2 week Call on Shares of Micron I’m holding. Today the market was up until it was announced that the FBI was looking further in HRC’s emails. I don’t think this story will ever go away! Anyway, after that announcement the market took a big dip, and it closed on a down note. The market is worried about the possibility of Trump becoming president so any bad news on Clinton will move the market in a negative direction.
I didn’t have any trades this week or I did’t get the opportunity to put any money in my mattress. With the market down going into the close I decided to Buy to Close my Calls on Micron (MU) which has 1 week until expiration. As I mentioned above, on Oct 20th I sold 50 contracts of the MU 11/4/16 $18 Calls and received a premium of $.22 ($1100). With a week to expiration and the premium down to $.10 I did a Buy to Close to lock in a $.12 for $600. Here’s the Sell and Buy order:
Sell to Open 50 MU 11/4/16 $18 C @ $.22 (+$1100)
Buy to Close 50 MU 11/4/16 $18 C @ $.10 (-$500)
Profit +$600
I projected this week to have very little, if any, profit. It was nice to get a little money in my mattress at the close. I project the next few weeks to be a little slow then things should get back on track and the money should start flowing in again. When you are holding stock with sold long term options on them, or some of your stock is lower that where you bought, this sort of thing happens. I like the way my last few months of the year is looking.
Steve
The Options Coach