When I buy Call options I go out a few months with the Expiration Date. I pay a little more for the option but I get a lot of time protection. One of the problems with this strategy is if the stock makes a nice move I’m torn between holding because I have a lot of time left on the contract and selling to take profit. After being an options trader for many years I know all too well that after a nice run, many times, a stock will take a dip. And we all know you will never go broke by taking profits.<\/p>\n
I used this “discipline” strategy on 3 of my long options that have plenty of time until expiration.<\/p>\n
Yesterday I had to be away from my computer for most of the afternoon and Micron (MU) was up on the day and up about $4 from when I bought my option. I bought the option on 3\/4\/24 with the premium at $9.40. My goal was to sell for $11.75, which would be a gain of 25%. When I left my office I placed a sell order at $12. When I got home I saw I was filled.<\/p>\n
<\/p>\n
3\/4\/24 \u2013 Buy to Open 2 MU 6\/21 24 $95.00 C @ $9.40<\/strong><\/p>\n 3\/8\/24 -Sell to Close 2 MU 6\/21 24 $95.00 C @ $12.00 <\/strong><\/p>\n It turns out I could have made more because the stock is up again today. You should never count on getting into a position at the low price and getting out at the high. I’m very happy with my profit of $520 in 4 days. This is a return of 27.6%.<\/p>\n Today with AMD up I decided to take profit. I bought this option on 3\/1\/24 for a premium of $24.70. Today the stock is up and it has been a very hot stock. I decided to lock in some profit. I placed a sell order at $34.70 and I was filled. This gave me a $1000 profit in 7 days. My goal was to make a 25% return but I ended up with a return of 40.4%.<\/p>\n <\/p>\n 3\/1\/24 \u2013 Buy to Open 1 AMD 6\/21\/24 $200.00 C @ $24.70<\/strong><\/p>\n 3\/8\/24 \u2013 Sell to Close 1 AMD 6\/21\/24 $200.00 C @ $34.70<\/strong><\/p>\n This one might bother some people because the stock is still running. The stock is up another $6 from where I exited the option. O’well.<\/p>\n I’ll be in both MU and AMD again soon with a higher Strike Price. They are both hot stocks!<\/p>\n Last week I also entered an option position with SNAP. I like the way the chart looked for a bounce back after dropping after earnings. I’m not crazy about this stock so I didn’t plan on staying in long, but again I went out to June with the Expiration Date for protection. I bought the position with the premium at $1.28. My goal was to get out at $1.60 which would have been a nice gain with my 5 contracts. Today the stock is up and I placed my sell order at $2.15 and I was filled.<\/p>\n <\/p>\n 3\/1\/24 \u2013 Buy to Open 5 SNAP 6\/21\/24 $12.00 C @ $1.28<\/strong><\/p>\n 3\/8\/24 \u2013 Sell to Close 5 SNAP 6\/21\/24 $12.00 C @ $2.15<\/strong><\/p>\n Getting out at $2.15 gave me a nice return. My gain is $435 and the return is 68%.<\/p>\n I’ll be watching closely to see if I get an opportunity to get back into MU and AMD.<\/p>\n It’s turning out to be another pretty nice week.<\/p>\n Let me know if you have any questions.<\/p>\n <\/p>\n Successful trading,<\/p>\n Steve<\/p>\n The Options Coach<\/em><\/p>\n","protected":false},"excerpt":{"rendered":" When I buy Call options I go out a few months with the Expiration Date. I pay a little more for the option but I get a lot of time protection. One of the problems with this strategy is if the stock makes a nice move I’m torn between holding because I have a lot […]<\/p>\n","protected":false},"author":1,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"class_list":["post-14082","page","type-page","status-publish","hentry"],"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/P75MP0-3F8","jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/pages\/14082","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14082"}],"version-history":[{"count":1,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/pages\/14082\/revisions"}],"predecessor-version":[{"id":14085,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/pages\/14082\/revisions\/14085"}],"wp:attachment":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14082"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Profit +$520<\/strong><\/span><\/h4>\n
\nProfit $1000<\/strong><\/span><\/h4>\n
\nProfit +$435<\/strong><\/span><\/h4>\n