I was just filled on my buy order for 1000 shares of Square (SQ).
Yesterday with SQ at $62.14 I sold a 10 contract Naked Call. The stock has been going down and it looked like it hit support. It did reverse and it started to move up. I did sell a Naked Call but I mentioned it the post reporting that trade that I didn’t think I would be Naked long.
Buy 1000 Shares SQ @ $62.75
When I sold the Call I placed an order to buy the 1000 shares at $62.75. I figured if the stock didn’t go up I’d stay Naked, and if the stock went up to the point it was approaching my Strike Price I would be filled on the buy order to cover my Naked Call. Well, today the stock went up to $62.75 and I now have a Covered Call on SQ. When I made the Naked Call trade I gave it a risk factor 2. Now that I’m Covered, it now has a Risk Factor 1.
Now I hope the stock continues up and I get assigned after the close on Friday.
Steve
The Options Coach