{"id":1007,"date":"2016-01-11T11:22:24","date_gmt":"2016-01-11T16:22:24","guid":{"rendered":"http:\/\/www.mainstbeatswallst.com\/?p=1007"},"modified":"2016-01-16T10:32:08","modified_gmt":"2016-01-16T15:32:08","slug":"facebook-netflix-naked-calls","status":"publish","type":"post","link":"https:\/\/www.mainstbeatswallst.com\/?p=1007","title":{"rendered":"Facebook & Netflix Naked Calls"},"content":{"rendered":"

\"Screen<\/a><\/p>\n

I guess 2016 is off and running. Let’s get to work! This morning looking at the market I get the feeling it’s struggling to stay on the plus side. At the opening I was looking at Facebook (FB) and Netflix (NFLX) calls. Because the market was trying to hold onto to the small opening gain and not being successful I sold Naked Calls on both stocks. First I sold 20 contracts of the NFLX $115 Calls with the Expiration Date of Jan 15th, this Friday. I put a Risk Factor of 2. This is a low risk trade. The only reason I didn’t put a 1 is because NFLX is so volatile. I received a premium of $1.75. Here is the order:<\/p>\n

Sell to Open 20 NFLX 1\/15\/16 $115 C @ $1.75<\/strong><\/h4>\n

 <\/p>\n

When I sold this Naked Call the stock was at $113 and change. When I started writing this post I was watching the computer and NFLX started to run up, fast. I stopped writing so I could get my order set up just in case I had to buy the stock. The stock went all the way up to over my $115 strike Price and I put a buy order in at $115. It dropped a little and I was executed at $115. So now I have a Covered Call. If the stock moves up this week I will not make money on the stock because of my $115 Strike Price. When you do a Covered Call, you limit your upside gain to where your Strike Price is. I bought the stock at $115 and my Strike Price is $115. If the stock stays above $115, the only profit I’ll make is the premium which is fine with me because that’s what I’m in this game for. My premium was $1.75. On the 2000 shares my total premium will be $3500. Here is the order to buy the stock:<\/p>\n

Buy 2000 Shares NFLX at $115<\/strong><\/h4>\n
\n

\u00a0I also sold Naked Calls on FB. The stock was at $97.70. I sold 10 contracts of the $99.50 Calls with the Expiration Date of Jan 15, this Friday. I received a premium of $1.05. The total premium on the 1000 shares was $1050. While NFLX was moving up FB started moving down. When you sell a Naked Call, this is what’s best. You don’t have to get your direction perfect. If the stock goes down or stays the same, this is great. The stock can also go up a little and you are OK. If the stock goes up above the Strike Price, You have to make a move, like cover your Call by purchasing the stock.<\/p>\n

This is a crazy day, because as I was writing about my NFLX trade I had to make a move. The stock starting going up so I covered my Call. Now as I’m writing about FB I also made a move. Just now! This is truly LIVE TRADING.<\/strong><\/p>\n

FB continued to move down more so I decided to buy the option back. This might start to get complicated for a beginner so use my email if you don’t understand something. Let me show you the order for the FB Naked Call then I’ll move on.<\/p>\n

Sell to Open10 FB 1\/15\/16 $99.50 C @ $1.05<\/strong><\/h4>\n

That’s the order to sell the Call but as I’m writing I bought my way out of this trade. I sold and brought is $1050 and I just bought back for $.65. On the 1000 shares that’s $650. I sold for $1050 and bought for $650. Thats a 20 minute profit of $400. I love deals like this! here’s the order to get out of the trade:<\/p>\n

Buy to Close 10 FB 1\/15\/16 C @ $.65\u00a0<\/strong><\/h4>\n

This deal is over!<\/p>\n

FB Profit $400<\/strong><\/h4>\n

 <\/p>\n

Pages to read to understand these trades:<\/strong><\/span><\/p>\n

Covered call<\/p>\n

Option Order Form<\/p>\n

Long & Short Positions<\/p>\n

 <\/p>\n

 <\/p>\n

I have to get back to work!<\/p>\n

 <\/p>\n

Steve<\/p>\n

The Options Coach<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

I guess 2016 is off and running. Let’s get to work! This morning looking at the market I get the feeling it’s struggling to stay on the plus side. At the opening I was looking at Facebook (FB) and Netflix (NFLX) calls. Because the market was trying to hold onto to the small opening gain […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[1],"tags":[],"class_list":["post-1007","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p75MP0-gf","jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/posts\/1007","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"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=1007"}],"version-history":[{"count":5,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/posts\/1007\/revisions"}],"predecessor-version":[{"id":1117,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/posts\/1007\/revisions\/1117"}],"wp:attachment":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1007"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1007"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1007"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}