Earlier I bought 100 shares of Netflix (NFLX) at $395. I decided to sell a Call against these shares. I sold a 1 contract Call with a Strike Price of $402.50 for a premium of $6. This Call will expire on Friday and give me a total premium of $600. I am well aware that I will probably get assigned but after having a great 1st half of the year I’m trying to be very careful.
Sell to Open 1 NFLX 6/29/18 $402.50 C @ $6.00 (+$600)
Bringing in a $6 premium on a stock I bought for $395 is a return of 1.5%. This fits into my “1 Week/1%” strategy.
As I write NFLX is already above my Strike Price lol. This doesn’t mean it will stay there. If It does and I get assigned I will make $7.50 on the stock for $750, plus the $6 premium for $600. It will be a nice trade with a gain of $1350 if assigned.
This is a Covered Call on a great stock so the trade gets a Risk Factor 1.
Steve
The Options Coach