This was another very good week of locking in profits, however, it wasn\u2019t a great week for the market and the positions I still hold.<\/p>\n
Trading options is an aggressive way to invest. You can adjust your trading strategies to be high risk, which would give you crazy high rates of return, or you can stay low risk and take in less in return. I am a low risk options trader which is evident in my returns. I bring in lower returns but I am very consistent with winning trades. The high risk options trader can bring in returns that are over 100% per trade. But many times these trader\u2019s options will expire worthless. In my opinion, the high risk trader is participating in pure gambling.<\/p>\n
This week one of my trades was a Covered Call with Micron. When the market was in one of it\u2019s pullbacks I exited the option position I sold with a \u201cBuy to Close.\u201d I closed the position with a $570 profit. I was in the position for 2 days. A Covered Call is when you buy a stock and sell a Call Option to someone for a premium. This is the #1 safest strategy when trading options. If fact it\u2019s so safe you can trade Covered Calls in your IRA. You cannot buy options or sell Naked Call Options in your IRA. The rules of an IRA lets you trade Covered Calls because it is a very safe, low risk investment. When I did the \u201cBuy to Close\u201d on the option I was left only owning the shares I sold the Call against. When I exited my Micron Covered Call trade I reported the trade with a post. I reported that I did a \u201cBuy to Close\u201d with a profit of $570 and I still owned the stock. In that post I received a message from a Main Street beats Wall Street<\/strong> loyal reader. And the reader wrote: \u201cYes but you have a paper loss of $3715. !!! What are you going to do if it continues to trade down\u201d?\u00a0<\/em><\/p>\n The multiple exclamation points made me feel the reader was asking the question with a sense of urgency that my stock was down from where I purchased.<\/p>\n If you want to be a stock trader or an options trader you must understand that stocks do not only move up. If you know of a stock that only moves up please send me that stock. The truth is there are none. The market moves with news! And news is constantly being reported. Stocks will always respond to news by moving up or down. This is how markets react and the stocks will always fluctuate. If you have low risk tolerance and you want to be an options trader, Covered Calls are the way to go.<\/p>\n Back to the reader\u2019s question, \u201cWhat are you going to do if it continues to trade down\u201d?\u00a0<\/em><\/p>\n I guess I\u2019ll do what Warren Buffett will do if Apple trades down! The truth is, I don\u2019t feel Micron will continue down. That\u2019s why I picked this stock to do a Covered Call. It\u2019s a very good stock with multiple \u201cBuy Ratings.\u201d But anything can happen! The stock market or options trading is not a guaranteed positive return. There is always risk. If Micron continues down I\u2019ll hold on. I\u2019ll make a decision as I see how low it goes. My plan is the stock will be back to my purchase very soon and I\u2019ll continue selling Calls until I get assigned. Once in a while a stock will go down and stay down for a long time. In this situation the money I have invested in the stock is out of my trading funds for a while. It is because of this potential problem my #1 strategy is selling Naked Calls, which presents a bigger problem if the stock moves against your desired direction.<\/p>\n Besides Micron, I\u2019m also holding Applied Materials and Advanced Micro Devices which were part of Covered Calls and are below where I got in. If the market goes down and these stock continue down it will seriously curtail my trading and my gains. Let\u2019s hope this doesn\u2019t happen and I continue bringing in nice returns.<\/p>\n As you can see I had a lot of trades come to an end this week. Let\u2019s take a look.<\/p>\n Nvidia<\/strong><\/p>\n I bought an option and I jumped out in the same day with a $500 profit.<\/p>\n 7\/29\/19 \u2013 Buy to Open \u00a010 NVDA 1\/17\/20 $175.00 C @ $17.25 ($17,250)<\/p>\n 7\/29\/19 \u2013 Sell to Close 10 NVDA 1\/17\/20 $175.00 C @ $17.75 ($17,750)<\/p>\n Nvidia<\/strong><\/p>\n Bought another Call the next day and had the same result.<\/p>\n 7\/30\/19 \u2013 Buy to Open 10 NVDA 1\/17\/20 $175.00 C @ $17.20 ($17,200)<\/p>\n 7\/30\/19 \u2013 Sell to Close 10 NVDA 1\/17\/20 $175.00 C @ $17.70 ($17,700)<\/p>\n Apple<\/strong><\/p>\n Bought an Call on Apple on 7\/11\/19 and got out this week. This was a long term option and I wanted to hold for a while but I felt trouble brewing. I got out with a nice profit after earnings.<\/p>\n 7\/11\/19 \u2013 Buy to Open 3 AAPL 6\/19\/20 $205.00 C @ $19.00 ($5700)<\/p>\n 7\/31\/19 \u2013 Sell to Close 3 AAPL 6\/19\/20 $205.00 C @ $26.00 ($7800)<\/p>\n Micron<\/strong><\/p>\n This is the trade I wrote about above. I did a Covered Call and got out of the Call a couple go days early with a Buy to Close for 5\u00a2.<\/p>\n 7\/30\/19 \u2013 Sell to Open 10 MU 8\/2\/19 $48.00 C @ 62\u00a2 (+$620)<\/p>\n 8\/1\/19 \u2013 Buy to Close 10 MU 8\/2\/19 $48.00 C @ 5\u00a2 (-$50)<\/p>\n Applied Materials<\/strong><\/p>\n This was a Covered Call. The Call expired and I still own the stock.<\/p>\n 7\/29\/19 \u2013 Sell to Open 10 AMAT 8\/2\/19 $51.00 C @ 60\u00a2 (+$600)<\/p>\n 8\/2\/19 \u2013 Expired 10 AMAT 8\/2\/19 $51.00 C<\/p>\n Twitter<\/strong><\/p>\n This was another Covered Call with TWTR. The Call expired and on this one I also still own the stock. The only difference with TWTR and AMAT is TWTR closed very close to my Strike Price and I was able to sell another Call right at the close that will expire next Friday, the 9th. This week\u2019s Call I received a premium of $530 and the new Call, expiring next week, I received a premium of $900.<\/p>\n 7\/30\/19- Sell to Open 10 TWTR 8\/2\/19 $43.00 C @ 53\u00a2 (+$530)<\/p>\n 8\/2\/19 \u2013 Expired 10 TWTR 8\/2\/19 $43.00 C<\/p>\n As I said in my opening line, this was another very good week but I\u2019m still holding a few stocks that are below my purchase price, which is the concern the reader I referenced above had. Whatever happens to the market, this $4800 is locked-in, and my mattress is getting thick!<\/p>\n Let\u2019s hope the market starts up and I can get Calls sold against the stocks I\u2019m holding.<\/p>\n Any questions send me an email.<\/p>\n Have a great weekend!<\/p>\n Steve<\/p>\n The Options Coach<\/em><\/p>\n\n\n <\/p>\n","protected":false},"excerpt":{"rendered":" This was another very good week of locking in profits, however, it wasn\u2019t a great week for the market and the positions I still hold. Trading options is an aggressive way to invest. You can adjust your trading strategies to be high risk, which would give you crazy high rates of return, or you can […]<\/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-5449","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\/p75MP0-1pT","jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/posts\/5449","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=5449"}],"version-history":[{"count":2,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/posts\/5449\/revisions"}],"predecessor-version":[{"id":5799,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=\/wp\/v2\/posts\/5449\/revisions\/5799"}],"wp:attachment":[{"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=5449"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=5449"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.mainstbeatswallst.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=5449"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nProfit +$500<\/strong><\/h4>\n
\nProfit +$500<\/strong><\/h4>\n
\nProfit +$2100<\/strong><\/h4>\n
\nProfit +$570<\/strong><\/h4>\n
\nProfit +$600<\/strong><\/h4>\n
\nProfit +$530<\/strong><\/h4>\n
\nTotal Weekly Gain +$4800<\/strong><\/h1>\n