Today I sold 50 shares of Apple (AAPL). I’m not sure what the profit is but I did sell at a profit. I’ve been buying AAPL 5 and 10 shares at a time for a long time and accumulated 150 shares. I bought the shares at all different prices ranging from $153 per share and $207 per share. Today I sold the 50 shares at $203. With this sale I brought $10,150 of available funds into my account. With this money I bought (3) 6/19/202 $205.00 LEAP Calls for a premium $19. I sold 50 shares and I’m now in control of 300 shares of AAPL until June 19, 2020. This option cost me $5700. I’m now in control of many more shares, and I have more available cash in my account. If AAPL goes up, with my 3 contracts, I’ll make more money with this option than when I had the 50 shares. And this option will not expire any time soon.
Buy to Open 3 AAPL 6/19/20 $205.00 C @ $19.00 ($5700)
I did buy an option and buying options can be very dangerous. However, this is a LEAP (long term option), which is a very safe way to buy options. I give this trade a Risk Factor 2.
I still own 100 shares of AAPL stock which will be used as gifts and remain in my “Gift Account.”
I will be writing about buying options very soon.
Steve
The Options Coach