Another Nvidia Split Update

Nvidia did a 4:1 split on July 19th. I bought and sold long term Calls before the split and I bought Calls to hold well after the split. I bought a total of 4 different 1 contract Calls before the split to be held after the split. All of these Calls turned into a 4 contract Call. The split gave me a total of 16 Calls expiring on different Expiration Dates.

2 of my Calls I bought before the split were expiring on 10/15/21. This gave me 8 Calls to expire in October. 4 had the Strike Price of $760 turning into $190 post split. I sold these contracts on 8/4/21

4 had the Strike Price of $820 turning into $205. These 4 contracts I sold today. With Nvidia moving big today I decided to lock in the profit. I do not like short term options and these expire in October. Yes the stock is moving up but if the stock pulls back it could wipe the profit out. If it pulls back the stock may, or may not, recover before the October expiration. With Long options I like to lock in profit when time is running out. October is approaching.

With the stock at $819, before the split, I bought 1 contract of the 10/15/21 $820 Call for a premium of $70. After the split this became 4 contracts of the 10/15/21 $205 Calls with the cost basis of $17.50. Today I sold the 4 contracts for a premium of $20. This gave me a profit of $2.50. The $2.50 times the 4 contracts (400 shares) gives me a profit of $1000.

 

Post 4:1 Split “Sell to Close”

7/7/21 – Buy to Open 1 NVDA 10/15/21 $820.00 C @ $70.00 

8/23/21 – Sell to Close 4 NVDA 10/15/21 $205.00 C @ $20.00 

Profit +$1000

 

With this $1000, to date I took in a total of $10,600 on the Nvidia split. And I still own 4 contracts of the 1/21/22 $190 Calls and 4 contracts of the 1/20/23 $205 Calls. These still have a long way to expiration and I think I’ll be bringing in a bunch more money with these positions.

You can see all my positions I’m holding and exited on the bottom of the Active Positions page.

If you have any questions on my split strategy send me an email.

 

Successful Trading

Steve

The Options Coach