On 9\/11\/17 I bought 1000 shares of Micron (MU) at $32.85. A week later, with the stock at $35.70 I sold a 10 contract $40 Call Option to expire on 1\/19\/18 which is consider a LEAP option (long term option). Since I entered this long term Covered Call the stock continued moving up. When I sold the Call, many investment firms had a price target of $40. However, with the company having a great earnings report last week, many firms raised their price target to above $70. With a Covered Call you continue making money on the stock until it hits the Strike Price. In this case $40. Today the stock hit the $40 mark. First, with the belief MU will continue up, I decided to “Buy to Close” the option at a loss to try to make more money on the stock moving up. When I sold the option I received a premium of $1.70 ($1700). Today the premium was up to $3.70 ($3700). With the “Buy to Close” I took a loss of $2000 to get out of my obligation of delivering my stock on 1\/19\/18 at $40. Remember, I bought the stock at $32.85. I have a very nice profit on the stock already.<\/p>\n
Second, after getting out of the option I looked into the stock and I decided to enter a $40 Stop Loss order in the case the stock started down a little. I wanted to lock in stock profit. I didn’t think the NASDAQ was gonna hold on to it’s gains and I felt the stock may drop off a little. In no way do I think MU is done going up, I just wanted to grab profit, and watch what the stock does in the short term. I know I’ll be back in the stock very soon because I believe it will go above $60 by the end of the year. I just got out today in the case the stock has a temporary pullback. It’s a very hot stock right now and I will be back in. Below are the trades involved in this Covered Call LEAP.<\/p>\n
<\/p>\n
Micron Covered Call LEAP<\/strong><\/span><\/p>\n 9\/11\/17 – Buy 1000 MU @ $32.85<\/p>\n 10\/2\/17 – Sell 1000 MU @ $40.00<\/p>\n Profit +$7150<\/strong><\/span><\/p>\n 9\/18\/17 – Sell to Open 10 MU 1\/19\/18 $40.00 C @ $1.70 (+$1700)<\/p>\n 10\/2\/17 – Buy to Close 10 MU 1\/19\/18 $40.00 C @ $3.70 (-$3700)<\/p>\n Loss -$2000<\/strong><\/span><\/p>\n <\/p>\n <\/p>\n As I write the price of Micron is down to $39.50.<\/p>\n <\/p>\n These trades were made about 45 minutes ago. I’m trying to type as a watch the very sad news coming out of Las Vegas. So, so sad! I’ll be praying for the victims and their families. I pray that our politicians on both sides of the isle can learn, come together, and \u00a0come up with solutions to help prevent this from ever happening again.<\/p>\n <\/p>\n May God bless America,<\/p>\n Steve<\/p>\n The Options Coach\u00a0<\/em><\/p>\n","protected":false},"excerpt":{"rendered":" On 9\/11\/17 I bought 1000 shares of Micron (MU) at $32.85. A week later, with the stock at $35.70 I sold a 10 contract $40 Call Option to expire on 1\/19\/18 which is consider a LEAP option (long term option). Since I entered this long term Covered Call the stock continued moving up. When I […]<\/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-3616","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-Wk","jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/posts\/3616","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=3616"}],"version-history":[{"count":1,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/posts\/3616\/revisions"}],"predecessor-version":[{"id":3617,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/posts\/3616\/revisions\/3617"}],"wp:attachment":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3616"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3616"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3616"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Total LEAP Profit +$5150<\/strong><\/span><\/h4>\n