To me it looks like GoPro (GPRO) could be hitting resistance with the stock at $11.12. I just sold 50 contracts of the GPRO 6/24/16 $11.50 Naked Calls. I brought is a $.17 ($850) premium. This Call fits into my strategy I call “1Week/1%.” Being a Main Street beats Wall Street reader you know I love to make trades that give me a 1% premium on a 1 week option. This is a Naked Call but if I was to do a Covered Call here and bought the 5000 shares, the investment would be $55,600. 5000 shares with the stock at $11.12. Bringing in a premium of $850 on a $55,600 investment is a weekly Rate of Return of 1.5%. This is what I look for! To make this a great trade I need GPRO to be below $11.50 on this coming Friday. If the stock continues up during the week, I might cover this Call. I will watch this closely. This is a Naked Call with the stock about $.40 Out-of-the-Money. I will give this trade a Risk Factor of 5. I feel good about this trade and I’ll be watching closely but it’s still a Naked Call on a stock that’s been moving up. My biggest fear is that a “take over” announcement comes in the news. Let’s hope one doesn’t come before Friday. Here’s the option sell order:
6/21/16 – Sell 50 GPRO 6/24/16 $11.50 C @ $.17 (+$850)
Email me any questions!
Steve
The Options Coach