Sold My Micron Shares, Sold a Square Naked Call
I bought 1000 Shares of Micron (MU) back on 6/30/20 at $51.75 per share. In the time since I bought the stock I brought in a total of $5750 in premiums from selling Covered Calls.
You can easily look at all my trades by going to my “Trade History 2020″ page. All of the Strike Prices used were $52 or $51.50. The one exception was the most recent Call when the stock pulled back a bit, I used the $45 Strike Price.
The stock has been in the area between $45 and $52 for the majority of the time I was Long the stock. Today the stock received an upgrade from Deutsche Bank raising it’s rating from a “Hold” to a “Buy.”
With the election upon us I’m trying to get out of my stock holdings. Today’s upgrade of Micron, and the stock getting up to $52.72, gave me a good opportunity to sell my stock at a profit. With the stock at it’s day’s high I placed a “Stop Loss” order at $52.50. This order would sell my stock if it came down to $52.50 while giving me more upside if the stock was to continue up.
The stock came down to my “Stop” price and my sell order was filled. I sold 1000 shares of MU at $52.50 giving me a 75¢ profit for $750.
6/30/20 – Buy 1000 Shares MU @ $51.75
10/13/20 – Sell 1000 Shares MU @ $52.50
Profit +$750
I owned Micron for just short of 4 months. In that time I brought in $5750 in premiums, and now a profit of $750 on the stock sale. My total profit for the 14 weeks being in the MU position is $6500. This is a 12.56% return on my investment. Not my best return for an investment of this length of time, but who would complain with this return?
Exiting this position better prepares me for my election strategy.
Today I also sold a Naked Call with Square (SQ). With the stock in the $88 area, up $4, I sold 10 contracts of the SQ 10/16/20 $200 Call for a premium of $1.10 for $1100.
Sell to Open 10 SQ 10/16/20 $200.00 C @ $1.10 (+$1100)
With the stock up today, I felt going out to the $200 Strike Price was safe, however, SQ is a hot stock for a Naked Call . With 4 days remaining until expiration, I feel selling a Naked Call over $10 Out-of-the-Money is safe. But I will still give this trade a Risk Factor 4 because it can be a dangerous trade.
I also feel this position is sticking with my election strategy of getting out of stocks, but I am an options trader and I will continue to be in the game with what I feel are safe trades.
Successful trading,
Steve
The Options Coach