Snap (SNAP) has been on the Unusual Activity list for days now. There are a lot of investors/traders buying a ton of options at different Strike Prices and Expirations Dates. The general consensus is that this stock is going up.
I’m not a big fan of Snap but I am a big fan of making money. a little while ago I was gonna buy 1000 shares and hold them until the new year, then sell a Call. Since I feel this stock is going up, and I’m not a big fan, I decided to not buy the shares and sell a Put. With the stock at $52.50 I sold 10 Snap 12/24/20 $52 Puts and received a premium of 80¢ for $800.
Sell to Open 10 SNAP 12/24/20 $52.00 C @ 80¢ (+$800)
I was gonna buy the shares at $52.50, but by selling the Put I’m getting paid a premium to buy the shares at $52 if the shares are put to me. If the shares are not put to me I keep the $800 and move on.
The shares will be put to me if the stock drops below $52. If this happens I’ll hold the shares into next year as originally planned.
Any questions on Puts send me an email.
I’m sorry about the problem with the NEO post earlier. If you had trouble looking at that post you can look at it here.
Successful trading,
Steve
The Options Coach