I bought 1000 Shares of Weighers Watchers on 10/23/17 for $45.50. When I bought the shares I sold a Call. I did not get assigned and I sold another Call. With both of these Calls I did not get assigned. This morning the stock opened 50¢ below where I bought in. Now I’m holding the stock and the earnings are coming out today after the close. Since I cannot sell unless I take a little lose, I decided to sell another Call. I don’t like to get involved in a Covered Call with a stock reporting earnings but it just worked out this way because I wasn’t assigned on my 2 last Calls. With the earning coming the premiums are very high. I just sold 10 WTW 11/11/17 $46 Calls for a premium of $3 for a total of $3000.
Sell to Open 10 WTW 11/11/17 $46.00 C @ $3.00 (+$3000)
The way I’m looking at this, if I didn’t sell a Call I would still be holding the stock because it’s below where I bought. So, if the stock goes down after earnings I might as well grab the $3000 premium. If the stock goes up I’ll be very happy making 50¢ on the stock and keeping the $3000 premium. I’m giving this trade a Risk Factor 1 for this reason.
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Also I’m reporting that I’m back in Micron (MU). I lost my 1000 shares when I was assigned on a Covered Call this past Friday. I bought another 1000 shares at $43. I believe MU will be going up. I’ll watch and see before I sell a Call.
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Steve
The Options Coach