As you know I had a low profit projection on this week. But again, as 2 weeks ago, I was able to lock is some nice profit late in the week. I really thought I would close out the week with no trades coming to a conclusion, however, I did “Buy to Close” 2 positions with Gopro (GPRO) and I was able to put $5650 into my mattress. Both of these trades I made as a result of GPRO taking a dip after their earnings reports. Both trades involved GPRO and both were made on Friday. Let’s take a look at the 2 trades.
GPRO
The first “Buy to Close” trade was on a 1 day trade. On Thursday 11/3 I sold a 100 contract Call on 10,000 shares I owned. Thursday with the earnings report coming out after the close I sold this Call on the 10,000 shares for a little insurance in the case the stock went down after the report. On the 100 contracts I sold the 1/20/17 $17 Call and received a premium of $.30 for $3000. On Friday the stock went down on the earnings and the premium went to $.10. I sold for $.30 and I bought the Call back for $.10 for a $.20 profit. This was a fantastic 1 day trade. Here’s the Sell and buy orders:
11/3/16 – Sell to Open 100 GPRO 1/20/17 $17 C @ $.30 (+$3000)
11/4/16 – Buy to Close 100 GPRO 1/20/17 $17 C @ $.10 (-$1000)
Profit +$2000
For my 2nd trade, I entered with the selling of a 50 contract Call way back on 7/15. I sold the 50 contract Call which had the same expiration date as the Call above and I received a premium of $1.03. This Call had the Strike Price of $15. On the 50 contracts (5000 shares) the total premium was $5150. With the stock down and 78 days to expiration the premium was down to $.30. I decided to close out this position for the $.30 premium and locked in the profit of $.73. On the 5000 shares that’s $3650. Here’s the sell and buy orders:
7/15/16 – Sell to Open 50 GPRO 1/20/17 $15 C @ $1.03 (+$5150)
11/4/16 – Buy to Close 50 GPRO 1/20/17 $15 C @ $.30 (-$1500)
Profit +$3650
These 2 trades were very basic Short Calls that were Covered Calls. If you have any questions on these trades please send me an email.
Total Weekly Gain +5650
Get ready for a wild week with the Presidential election. Which one of these sub-par candidates will we have to deal with for the next 4 years and how will they move the markets? Only time will tell!
Enjoy the rest of the weekend!
Steve
The Options Coach