Did a Covered Call with Roblox

Roblox (RBLX) had its IPO about a month ago. I really like this stock in today’s world. Anyone with children under the age of 16 is probably well aware of this wildly popular gaming platform. If you’re not familiar with Roblox, it is not a video game. It is a platform that allows people to create and publish their own video games using Roblox’s suite of tools; in effect outsourcing game development to its users. By the end of last year there were more than 20 million Roblox games available to play.

Roblox Corp is a technology company. The Company intends to build a human co-experience platform that enables shared experiences among billions of users. The Company offers a platform, which is powered by user-generated content that draws inspiration from gaming, entertainment, social media and even toys. The Company is focused on improving the ways in which the Roblox Platform supports shared experiences, ranging from how these experiences are built by an engaged community of developers to how they are enjoyed and safely accessed by users across the globe. All Roblox Platform users have identities in the form of avatars that allow them to interact and express themselves as whoever or whatever they want to be.

I think this tech stock will be moving. I just bought 500 shares of the stock at $72.90 and sold 5 contracts of the RBLX 4/16/21 $74 Calls. As I write the stock is already at $74.92 on a down day. I received a premium of $2 for a total of $1000 on the 5 contracts. I was going to go with 1000 shares but this is my first trade with this new stock so I went with 500.

 

Buy 500 Shares RBLX @ $72.90

Sell to Open 5 RBLX 4/16/21 $74.00 C @ $2.00 (+$1000)

 

This Covered Call gets a Risk Factor 1.

Let’s watch this stock, I think it will be a good one once Wall Street catches on.

 

Successful trading,

Steve

The Options Coach