Sold a 10 contract Naked Call on Square (SQ) this morning. Stock backed off so I just got out of the position.
Square opened up this morning and continued going higher. With the stock at $69.08, up $1.33 on the day, I sold a 10 contract Naked Call. I sold with a premium of 55¢ for $550. The stock backed off a bit and with the stock at $68.60 the premium was down to 30¢. When this happens, where I can get out in a few hours making a nice profit I get out. With today’s trade I sold for 55¢ and I just did a “Buy to Close” with the premium at 30¢. On my 10 contracts that’s a $250 profit in a few hours.
Sell to Open 10 SQ 11/29/19 $70.00 C @ 55¢ (+$550)
Buy to Close 10 SQ 11/29/19 $70.00 C @ 30¢ (-$300)
Profit +$250
The way I look at it is if I can get out with a nice profit why hold for the rest of the week. You never know what happens! This was a Naked Call! I’ll take the $250 and run. Another $250 in my mattress. You must take profits if you want to be a successful option’s trader.
Successful trading,
Steve
The Options Coach