I have 2 trades to report, 1 with Marvel (MRVL) and the other with U.S. Steel (X).
I am very high on Marvel. I own 1000 shares at $24.99 and I own a 10 contract Long Call which will not expire until 2022. I plan on holding it for at least a year.
I’m not sure if MRVL is ready to make a big move yet. It might take until 5G kicks into high gear in 2020. When it does I’ll be holding my Long Calls. When it comes to owning the stock, at this point, I’ll probably own shares constantly, but I’ll be selling Calls against them. As I get assigned I’ll buy more shares and sell more Calls. I’m gonna look at MRVL as a money stream for a few years.
Against my 1000 shares I just sold a 10 contract Call to expire next Friday. I sold 10 11/8/19 $25 Calls. If assigned I’ll only make 1¢ on the stock sale but I received a 45¢ premium. Thats a 1.8% return in 1 week.
Sell to Open 10 MRVL 11/8/19 $25.00 C @ 45¢ (+$450)
With a 1.8% return in 1 week this trade falls under my “1 Week/1%” strategy. Also, this is a Covered Call on one of my favorite stocks so it gets a Risk Factor 1.
My second trade involves U.S. Steel (X). X has a lot of unusual activity and the stock is up over 15% today on a positive earnings report. I did an At-the-Money Buy-Write. I bought 1000 shares of the stock at $13.50 and sold 10 contracts of the 13.50 Calls to expire next Friday.
U.S. Steel – Buy-Write
Buy 1000 Shares X @ $13.50
Sell to Open 10 X 11/8/19 $13.50 C @ 45¢ (+$450)
I was thinking of selling a Naked Call. I hope I didn’t make a mistake by buying the stock. But it’s tough to sell a Naked Call on a hot stock with a nice earnings report. My fear is that the stock moves down and I’m stuck in it for a while. For that reason I give this trade a Risk Factor 3.
Successful Trading,
Steve
The Options Coach