Results Week Ending 5/15/20
I have a few new students I’m working very closely with. They are Grasshoppers and they seem to be into what they’re learning. Maybe because they are locked it there homes like the rest of us. What ever the reason, they’re young and I feel they have a lot of potential to make a lot of money in their lives if they stick to the rules.
Well, if they’re looking for a little inspiration, this week I locked in the most money since January of 2018. When I say “locked in” it doesn’t always mean my account went up by the amount I “lock in” on the week.
For instance, I sold a few of my LEAPS positions this week. They brought in some real nice money. However, I’m still holding about 10 more. This week was not a very good week for the market. All of my LEAPS went down. When you hold a position, and it goes down, you didn’t lose the money because you’re still holding the position, but your account will suffer until the position comes back up. This week my account reflects all my LEAPS being down. Moreover, I’m holding 1000 shares of United Airlines (UAL). I didn’t want to hold this stock, and I was very vocal about this. But I did a Covered Call, wasn’t assigned, and now I’m stuck with the stock down $9 from where I bought. Yes, that’s $9000! This is the reason why I love to get assigned. The desire to get assigned does not fit into everyone’s strategy, but it is mine. As I said, for this reason. I like to get assigned and move on. I’m a TRADER! Keep putting my money to work on a weekly, or monthly, basis so I want my money available. Assignment keeps my money available. I don’t want my money dormant, enduring the fluctuations of the market. Especially in these times!
Let’s take a look at the many trades I exited to have the biggest week in 2 years.
I did a “Buy to Close” on a Naked Call.
5/8/20 – Sell to Open 10 TWTR 5/15/20 $29.50 C @ $1.03 ($1030)
5/11/20 – Buy to Close 10 TWTR $29.50 C @ 73¢ (-$730)
Profit +$300
Penn Gaming
I sold a 2 Contract LEAPS. I held this position for a month. This trade had a Rate of Return of 222%. FANTASTIC!
4/2/20 – Buy to Open 2 PENN 1/21/22 $10.00 C @ $5.40
5/11/20 – Sell to Close 2 PENN 1/21/22 $10.00 C @ $12.00
Profit +$2400
Nvidia
Another LEAPS I decided to sell. Turned out to be a premature sale because the stock continued up. No Problem! The Rate of Return is 47% in less than 3 weeks.
4/21/20 – Buy to Open 1 NVDA 1/21/22 $270.00 C @ $68.00
5/11/20 – Sell to Close 1 NVDA 1/21/22 $270.00 C @ $100.00
Profit +$3200
RH
Another LEAPS sold. Held for less than 3 weeks. 55% gain!
4/22/20 – Buy to Open 1 RH 1/21/22 $125.00 C @ $47.00
5/11/20 – Sell to Close 1 RH 1/21/22 $125.00 C @ $73.00
Profit +$2600
Micron
Did a “Buy to Close” on a Naked Call.
5/11/20 – Sell to Open 10 MU 5/15/20 $50.00 C @ 50¢ (+$500)
5/12/20 – Buy to Close 10 MU 5/15/20 $50.00 C @ 15¢ (-$150)
Profit +$350
United Airlines
Expired Covered Call. I was not assigned. The problem is I’m stuck with this stock at $19.92. I’ll continue selling Calls.
5/5/20 – Sell to Open 10 UAL 5/15/20 $28.00 C @ $1.00 (+$1000)
5/15/20 – Expired 10 UAL 5/15/20 $28.00 C
Profit +$1000
Inseego
I like Inseego but it only has monthly options. This was a Naked Call. I bought shares with this premium.
4/21/20 – Sell to Open 10 INSG 5/15/20 $15.00 C @ 45¢ (+$450)
5/15/20 – Expired 10 INSG 5/15/20 $15.00 C
Profit +$450
Inseego
Inseego took a beating this week. It’s been doing great but the coronavirus is taking it’s toll. I like the stock and hold two 20 contracts LEAPS. Now that it’s down I might buy more. The stock dropped below my Strike Price with this Put so I did a “Buy to Close” at the close of the market on Friday. I still made $600.
4/17/20 – Sell to Open 10 INSG 5/15/20 $10.00 P @ 95¢ (+$950)
5/15/20 – Buy to Close 10 INSG 5/15/20 $10.00 P @ 35¢ (-$350)
Profit $600
Peloton – Triple Play Hedge
This might get a little complicated for anyone not interested in my Triple Play Hedge Strategy. All Calls expired for huge profits. However, one of the Calls was a $48 Strike. The stock closed above $48. Right at the close on Friday I bought the stock to cover the Call. I had to buy the stock at $48.40 and was assigned at $48. I took a $400 loss on the stock but the Call brought in $750. The trade buying the stock is at the bottom of the Triple Play Hedge, see below. I was assigned on the $44 Call which was covered from the beginning. Made $300 on the stock sale.
5/12/20 – Buy 1000 Shares of PTON @ $43.70
5/15/20 – Assigned 1000 Shares PTON @ $44.00
Profit +$300
5/12/20 – Sell to Open 10 PTON 5/15/20 $44.00 C @ $1.75 (+$1750)
5/15/20 – Expired 10 PTON 5/15/20 $44.00 C
Profit +$1750
5/12/20 – Sell to Open 10 PTON 5/15/20 $48.00 C @ $75¢ (+$750)
5/15/20 – Expired 10 PTON 5/15/20 $48.00 C
Profit +$750
5/12/20 – Sell to Open 10 PTON 5/15/20 $49.00 C @ 50¢ (+$500)
5/15/20 – Expired 10 PTON 5/15/20 $49.00 C
Profit +$500
This is the stock I had to buy to cover my $48 Call
5/15/20 – Buy 1000 Shares PTON @ $48.40
5/15/20 – Assigned 1000 Shares PTON @ $48.00
Loss ($400)
Peloton – Covered Call
This was a 1 day Covered Call. I love trades like this. Made $100 on the stock sale and a $600 premium. Great for 1 day!
5/14/20 – Buy 1000 Shares PTON @ $45.90
5/15/20 – Assigned 1000 Shares PTON @ $46.00
Profit +$100
5/14/20 – Sell to Open 10 PTON 5/15/20 $46.00 Call @ 60¢ (+$600)
5/15/20 – Expired 10 PTON 5/15/20 $46.00 C
Profit +$600
Total Weekly Gain +$14,500
For those who made it through this post, congratulations! You love the option’s market lol.
I hope you can see the potential of LEAPS. My LEAPS are buying options but I strongly recommend staying away from buying shorter term options. Mark my words “YOU WILL LOSE MONEY!”
Any questions, send an email.
Enjoy your Sunday!
Successful Trading,
Steve
The Options Coach