Sold 20 Peloton Calls

On 5/18 I bought 1000 shares of Peloton (PTON) at 47.45, and on 5/26 I bought another 1000 at $43.40. On both of these purchases I sold Covered Calls and brought in a premium. The 1000 shares of each of these Covered Calls were not assigned. The result is I still own 2000 shares of PTON.

On my Current Positions page I now list the 2000 at the average price of $45.42.

A few minutes ago I sold 20 contracts of the  PTON 6/5/20 $46 Calls for a 50¢ premium.

5/26/20 – Buy 2000 Shares PTON @ $45.42

6/1/20 – Sell to Open 20 PTON 6/5/20 $46.00 C @ 50¢ (+$1000)

This trade is a Covered Call with a Risk Factor 1. As usual I hope to get assigned. The 50¢ premium on a $45.42 stock is a Return on Investment of 1.1% and it fits into my “1 Week/1%” strategy. If I get assigned my return will be higher because of the stock sale.

When the premium of this options was 38¢ I placed the trade order with a  premium of 50¢.  I was worried I wouldn’t get filled but that’s the premium I wanted. After I was filled the stock continued up. The premium is now 75¢. Oh well! Not too often do you get into, or out of a trade, at the perfect time. Get used to it! And don’t let it bother you.

Successful Trading,

Steve

The Options Coach