Earlier today I sold 30 contracts of the $110 Calls. I received a premium of $1.25. On the 3000 shares the total was $3750. This afternoon NFLX took a little dip and the premium went down and I just bought back the Calls for $.85. This is a $.40 profit. Remember when you sell Calls you are going Short. When you go short you sell before you buy. I sold for $1.25 and bought back for $.85. This is a profit of $.40 per share. On the 3000 shares the total profit is $1200. I don’t know about you but to me, that’s a great day. If I held to Friday I would have kept the entire $1.25 for a total of $3750 but in the market things always happen. I like to grab the profit and look for another deal tomorrow. I still own the stock, 3000 shares of NFLX. Let’s see what tomorrow brings. If it goes up, I can sell another Call. If it goes down, I hold until it comes back up and sell the stock or sell another Call. Here is the Order to get out of the option:
Buy to Close 30 NFLX 1/8/16 $110 C @ $.85
If you look at my post from earlier today you will see the order to sell this option.
Pages to look at to understand this trade:
Covered Calls
Long & Short Positions
1st completed trade of 2016!
Profit $1200
“In the Mattress”
The Options Coach