I’ve been hold 2000 shares of Advanced Micro Devices (AMD) since 6/26/17. It’s down from where I bought and I’m tired of holding this stock without making money. Last week I decided to sell a Call and start bring in some premiums. That is a $12.50 Call and it looks like it will expire today without assignment. I’ll put this small premium in my mattress and I just sold another 20 contract Call to expire next Friday. I sold 20 contracts of the 3/9/18 $12 Call for a 22¢ premium for a total of $440. If I get assigned, no problem! I’m ready to move on from AMD even if I take a loss on the stock sale. I’m just going to keep selling Calls, bringing in small premiums, until I get assigned. When I sold the Call the stock was at $11.60 and I received a 22¢ premium. That’s a 1.8% return on a 1 week trade. This is a Covered Call on previously owned stock, and I don’t mind getting assigned, so the trade get a Risk Factor 1.
Sell to Open 20 AMD 3/9/18 $12.00 C @ 22¢ (+$440)
Steve
The Options Coach