Daily profit of $340.7 Option Journey #20 (Roll up Tesla Cover Call)
This is the last week of 2020. The end of the Pandemic is near. The future is here. I hope and pray everything goes well for 2021.
This week's trading is slow since the market is flat or not much volatility that I can see. However, there are some winners and losers for the last week's trade, and I already close out some of the positions due to several reasons.
First I closed out the ZM with the loss. When I roll down the ZM, I thought that was the bottom, apparently, it does not seem that way. I decided to close out the trade when it actually down around $360 a share. It dropped more than $20 in a single day, and it seems there is more downside than an upside, so when I can still get out with the $1000 loss, I decided to close out the trade and not roll it down. When it has a good upside trend, I might get in again for it.
The second trade I did was close out the $700 Cover Call for the Tesla and roll it up to the $750 Cover Call with one more week out. It was due to Tesla is going up too fast, I did not want to lose out on the opportunity that the upside potential of it. In return, I lost one week of the time. At the moment, Tesla did not go up to shoot high, it went back down, therefore, technically I did not lose any money on the trade at the moment, but just lost the one week out time decade portion of it. I lost $623.54 on closeout $700 Cover Call, but I paper made money around $500 at the moment as of right now.
The third trade I did was close out AAPL, AMZN trade. Both went up significantly higher than the sold price and there is no need for waiting until the expiration date, so I close out the trade with AAPL $0.02, and AMZN with $0.05 per share. I will wait and see if AMZN goes down little tomorrow, then I will sell it for the next week and see if this is a possible trade again. The same goes for AAPL. Netflix went up as well as I am writing this blog. So I decided to close out the Netflix with $0.05.
The new trade I made is testing out the new idea. It is not a weekly option I used to do. It is also the smaller cap that I normally did not do. The first trade was LCA. As I am being honest, I do not know about the company and did not research this company at all. Simply I traded this stock because of the volatility. As volatility is more than 100 with this stock, I only risk about $1200 for the $1200 profit. It just seems to me 50 / 50 chance, so I just took a shot at it with the two weeks expiration out.
Another trade I did is NNDM. NNDM is the one stock that social media is talking about it a lot at the moment. It is due to Cathy Wood is purchasing this stock substantially. It is a very small market cap, yet really high volatility and if Cathy Wood is buying, I have no reason not to purchase it. It is a small-cap with only $8.5 a share I sold it for $7.5 with a $1.5 premium on it. My strategy for this is simple.
If the stock remains above $7.5, I would collect the full premium
If the stock goes below $7.5, I will get assign the share. and do a Cover call with it. In that sense, I will not lose the money with the play. Since it has high volatility, the Cover Call price will be also high. Let's say at the maturity date on Feb 21 the stock is trading at $5. I lost $1 on a share. I can simply sell call $6 and collect $1 and if it goes beyond $6, I close out the trade with profit. If remains, I still keep that $1 per share. As long as the stock remains, I can only lose time but never lose money as long as I am in the game.
If the stock goes bankrupt, I would lose $7500 which I can take the loss on it. (This will generally not happen so I am okay with it as well). Generally, if this happens, I already should have got most of the profit out with the option selling and cover call selling.
The last trade for the day is SNAP. SNAP went down significantly for a few days. It pops up today. It seems it showed the bottom at the $50 mark. That is why I decided to sell snap with the 48/50 put vertical one week out.
Close Trade:
ZM 10 Jan 8 350 /355 Put Vertical @ 1.1895 close @ 2.2 loss of $1010.5
TSLA 1 Jan 8 700 Cover Call @ 12.3246 close @ 18.56 loss of $623.54
AAPL 10 Dec 31 124/128 Put Vertical @ 0.8497 close @ 0.02 profit of $829.7 AMZN 8 Dec 31 3120 / 3125 Put Vertical @ 1.0193 close @ 0.05 profit of $775.44
NFLX 10 Dec 31 497.5 / 500 Put Vertical @ 0.4196 closed @ 0.05
Total profit of $340.7 for the day. However, the Tesla portion is still pending due to roll up status
Open Trade:
TSLA 1 Jan 22 750 Cover Call @ 17.88 LCA 10 Jan 21 22.5 / 25 Put Vertical @ 1.2196 NNDM 10 FEB 21 7.5 Naked Put @ 1.4748
SNAP 10 Jan 8 48/50 Put Vertical @ 0.5897
Current Position:
this week none
next week JPM 10 Jan 8 117/120 Put Vertical @ 0.8297
SNAP 10 Jan 8 48/50 Put Vertical @ 0.5897 More than two weeks out
LCA 10 Jan 21 22.5 / 25 Put Vertical @ 1.2196
NNDM 10 FEB 21 7.5 Naked Put @ 1.4748
cover call TSLA 1 Jan 22 750 Cover Call @ 17.88 TSLA: 120 shares ======================================================================= #sellingPut #optiontrade #sellingput #putvertical #PutVertical #trading #stock #option ======================================================================= I am not a financial advisor. Any trades listed are my own personal trades and meant for educational purposes only. Option trading bears high risk and high return strategy for trader.