I reported this morning that I bought 3000 shares of RH to end a trade with the stock which involved a short position. Now that I’m out of RH I just sold another Call. I sold 10 contracts of the $37.50 Calls to expire this Friday. At the time of the sale the stock was at $36.80. The premiums are pretty high because of it’s volatility, which scares me a little so I only sold 10 contracts. I got $1 on a $36.80 stock. That’s a 2.7% Rate of Return on a 1 week trade. I’m hoping the stock stays below the Strike Price of $37.50 so the Call expires. I’ll keep a eye on RH but it is a Naked Call so I give the trade a Risk Factor 5. Here’s the sell order:
Sell to Open 10 RH 3/31/17 $37.50 C @ $1.00 (+$1000)
Steve
The Options Coach