I bought 2000 shares of Advanced Micro Devices (AMD) at $14.39 way back on 6/26/17. I’ve sold a few Calls when I first got in but haven’t done anything in a while because the stock dropped and the premiums weren’t worth the trouble. The stock’s been moving up lately to above $13. Today the stock is in the $13 area and they’re reporting earnings today. I would like to get out of the shares, and I would like to get out with the stock above my buy in price of $14.30. So, I sold a $14.50 Call and I’m hoping the earnings are great and the stock takes off. If the earnings are not good I’ll keep my premium. I sold 20 contracts of the AMD 2/2/18 $14.50 Calls for 20¢, for a total of $400.
Sell to Open 20 AMD 2/2/18 $14.50 C @ 20¢ (+$400)
This is a 20¢ premium on a $13 stock. It’s a 1.5% return for a 4 day trade. It fits into my “1 Week/1%” strategy. I’m not recommending the trade because earnings are coming today. The stock can go up or go down. I don’t like to take the gamble with earnings but I’m already in the stock for a while and I thought it was a great opportunity to grab $400. If the stock goes down, I’m in it anyway.
Any question, send me an email.
Steve
The options Coach