Many Trades to Report

Today I had a few students come to my house. I normally don’t make many trades on a Friday but today is a little different.

My class today was on LEAPS. I’m not a big fan of buying short term options but I love LEAPS. My class was about owning long term options to get protection against Time Decay, and also getting the benefits of stock movement.

I’m a big believer in taking profit. Even on LEAPS with a lot of time remaining to the contract. I like the Time Decay protection in the case the stock goes down, but I still take profit if it goes up. I know, many times, I jump out of LEAPS early, and could have done much better, but believe me I put the newly available money to work elsewhere.

I’m sorry I’m late reporting these trades, I was busy teaching. Today I sold 2 LEAPS and bought 2 LEAPS. I also sold 500 shares of AT&T.

The first LEAPS I sold was with Walmart (WMT). I bought 5 contracts in April with the stock at $129. I bought 5 1/21/22 $130 Calls for $17. I was in them for 4 months and sold today at $17.60. I like WMT but at this point I’d like to put the money to work elsewhere. The profit was only $300. I still own a 1 contract LEAPS with WMT with a $120 Strike.

4/23/20 – Buy to Open 5 WMT 1/21/22 $130.00 C @ $17.00

8/14/20 – Sell to Close 5 WMT 1/21/20 $130.00 C @ $17.60

Profit +$300 

For the 4 months I got a Return on Investment (ROI) of 3.4%. It was time to move on!

I also sold my LEAPS with Crowdstrike (CRWD). This trade comes with a big story. On 8/1 I posted that I bought 2 Contracts of this LEAPS. As I do a little too often, I hit a wrong button and I bought 18 contracts. I have no Idea how it happened but I just realized it today. The last few days I was on a road trip to Boston and wasn’t near my computer much but this was a big mistake. I should have notices it. Luckily it worked out great. I thought the stocks was gonna do well, that’s why I was going for 2 contracts and not 1. Anyway, the stock was up $3 today, and with the big investment, I decided to take the profit. Because of the 18 contracts the profit was $3600. lol.

8/10/20 – Buy to Open 18 CRWD 1/15/21 $100.00 C @ $16.00

8/14/20 – Sell to Close 18 CRWD 1/15/21/$100.00 C @ $18.00

Profit +3600

I thought I made $2 on 2 contracts for $400. With my 18 contracts the profit was $3600. Crazy! I included my Trade Notification, which I do whenever I make a mistake. This ROI was 12.5% for the 4 day trade.

The next 2 LEAPS trades were with AAPL and TSLA. Both are splitting. I bought 5 contracts of the Apple (AAPL) 1/15/20 $460 Calls. I paid a premium of $43.80. This is a stock split play. In 2 weeks AAPL will do a 4:1 stock split. I plan on holding this position to about a day or 2 after the split. After the “split pop” a stock will normally pull back.

 Buy to Open 5 AAPL 1/15/21 $460.00 C @ $43.80 

I also have 3 other LEAPS on AAPL. You can see them on my Active Trades page. As you can tell I’m hoping for the stock to pop into, and after, the split.

Another stock to announce a split is Tesla (TSLA). They will do a 5:1 split in 2 weeks. I also plan on getting out of this one right after the split.

Buy to Open 1 TSLA 1/15/21 $1650.00 C @ $320.00 

If these 2 split plays work the way I think they will I should hit my yearly goal of 65%. As I write I’m up 56%.

On 7/23 I bought 500 shares of AT&T (T). This is another one I don’t like the way it’s moving. Maybe I’m a little impatient but I’m a trader. I’d rather put the money to work instead of waiting for the dividend.

7/23/20 – Buy 500 Shares T @ $29.65 

8/14/20 – Sell 500 Shares T @ $30.03

Profit +$190

With the LEAPS I bought that are splitting, I’ll end up with 20 contracts of the AAPL options and 5 contracts of the TSLA.

Any questions on how the split works on options, send me an email. I don’t recommend stock but I think I’ll do very well on these LEAPS.

Successful trading,

Steve

The Options Coach