Last week I sold 20 contracts of the RH $105 Calls against my 2000 shares. This week I did it a little different. In January I bought my shares as follows. I bought 1000 shares at $102.75, 500 shares at $104.25, than I bought another 500 shares as the stock pulled back at $101.50. I’m looking to lower my position with RH with it up at $102.70 today. I’m hoping to get assigned on some shares so I used a lower Strike Price on 1500 of the shares. I sold 15 contracts of the RH 5/18/18 $103 Calls and these Calls will be covered with the 1000 shares I bought at $102.75 and the 500 shares I bought at $101.50. If assigned I make money on the sale of these shares. With these $103 Calls I received a premium of $2.05. With the 500 shares I bought at $104.25 I sold 5 contracts of the RH 5/18/18 $105 Calls for a premium of $1.35. These trades are Covered Call on previously owned shares so they get a Risk Factor 1. Here are the trades.
Sell to Open 15 RH 5/18/18 $103.00 C @ $2.05 (+$3075)
And
Sell to Open 5 RH 5/18/18 $105.00 C @ $1.35 (+$675)
These trades give me a total of 20 contracts for a total premium of $3750. If RH continues up this can be a great week.
As I write RH pulled back a little.
I’m gonna try to get a Call sold on my SQ and NFLX but I really want to get down to the beach to relax. That is what I came here for!
If you have any questions on my strategy send me email. I’ll answer as quick as possible.
Steve
The Options Coach