I really had a great year in 2020. Because of this year I made a lot of tax moves in the last 2 week and curtailed my money making trades until the new year. I pushed many trade’s Expiration Dates to 1/8 and 1/15. Now that 2020 is behind us and we are 1 week into 2021, we hit our first Expiration Date of 1/8. This means I have a lot of positions that expired which gave me a huge week to start the year.
I must say, I don’t look at my gains as a result of being a great trader. The work and time I put in definitely helps but this market, at the moment, is making it very difficult to be a bad trader. I must take some credit but this market is just unbelievable! My prediction is it will not last so lets enjoy it while we can.
Some of my tax moves I didn’t post. I will talk about them as we go and I’ll add the loss I took to the last week of 2020. These losses will not change my year end results because the value of the position was already out of my year ending total account balance. On this subject today I’ll be talking about my Zoom position.
Before I get into this week’s trades I want to report a couple of trades. Yesterday I was traveling to Boston and my weak internet with my jetpack prevented me from reporting from my car. I did make 2 trades.
Way back, almost a year ago, I bought a 20 contract LEAPS with Inseego (INSG). This stock didn’t move great last year and actually moved below where it was when I bought the LEAPS. The last few months the stock started to move. I had a nice profit so I decided to get out. I like taking profit, plus I like getting rid of old positions with a new year. I hope to get out of a few more. I sold the position for a $2000 profit. This closed position is listed below.
This is a great example of why I like LEAPS. Yes, I understand I was in this position for 9 months but it became a winner. If I bought a short term option it would have been a loser. Having the time for the stock to recover gave me a winning trade. With a short term option the Time Decay would have made this a loser.
The next trade I made on the road was with Peloton. I had a $175 20 contract Call sold on the stock which was going to expire without assignment. I decided to sell another Call against these shares. I have another 20 contract Covered Call to expire next week because I own 4000 shares, so this Call I sold yesterday in the car I went out to 1/22. I sold 20 PTON 1/22/21 $170 Calls for a premium of $3.60 for $7200.
Sell to Open 20 PTON 1/22/21 $170.00 C @ $3.60 (+$7200)
INSG and PTON are the 2 trades I made from the car. For the loyal readers, I know my Peloton trades are getting complicated because of the tax move I made in December, but the only thing I can say is it worked great and you will continue to see large amounts of money being made as with the Call I sold yesterday. When transitioning from one year to another some trades can get confusing. Any questions on Peloton send me an email.
Let’s get to the first week of 2021, and it was a good one.
Tesla
I bought a Tesla 1 contract LEAPS on 12/18. The stock moved nicely and I jumped out with a $5000 gain. I should have never sold because the stock jumped about another $100 lol. I probably would have made another $10,000. O well! Take the $5000 and move on.
12/18/20 – Buy to Open 1 TSLA 1/21/22 $670.00 C @ $175.00
1/4/21 – Sell to Close 1 TSLA 1/21/22 $670.00 C @ $225.00
Profit $5000
Workhorse
This was one of the Covered Calls I pushed into the new year. I was assigned.
12/3/20 – Buy 1000 Shares WKHS @ $21.80
1/8/21 – Assigned 1000 Shares WKHS @ $24.00
Profit +$2200
12/22/20 – Sell to Open 10 WKHS 1/8/21 $24.00 C @ $1.10 (+$1100)
1/8/21 – Expired 10 WKHS 1/8/21 $24.00 C
Profit +$1100
Zoom
I am losing interest in Zoom. At least at the $500 price. I bought 400 shares at $508. The stock came way down with the announcement of the vaccine. I decided to sell this Call at a Strike Price much lower than the price that I bought the stock at just to bring in some premium. It was a Covered Call. Before the end of the year I decided to take the tax write-off and move on from Zoom. I took a huge loss. My year ending totals are still the same because my year ending account balance already accounted for Zoom at the lower price. I sold the 400 shares on 12/29/20 at $355. This was a huge loss! To keep my sanity I look at it as a write-off. The loss was $61,200. Can you imagine the year without this loss? I was debating buying the stock back in the new year and continuing with Zoom and only have the write-off but now that I decided to move on from Zoom I’ll add this loss to my “Trade History 2020” page.
This 4 contract Call expired with assignment. This cuts the loss a little lol.
12/29/20 – Sell to Open 4 ZM 1/8/21 $380.00 C @ $6.00 (+$2400)
1/8/21 – Expired 4 ZM 1/8/21 $380.00 C
Profit +$2400
Snap
This was a Covered Call without assignment. I already have another Call sold against these shares.
12/29/20 – Sell to Open 10 SNAP 1/8/21 $56.00 C @ $1.10 (+$1100)
1/8/21 – Expired 10 SNAP 1/8/21 $56.00 C
Profit +$1100
Tesla
With Tesla moving and getting upgrades I bought 100 shares and sold a 1 contract Call. This was a 2 day Call. With Tesla moving crazy I was assigned with a total 2 day gain of $2300.
1/6/21 – Buy 100 Shares TSLA @ $757.00
1/8/21 – Assigned 100 Shares TSLA @ $770.00
Profit +$1300
1/6/21 – Sell to Open 1 TSLA 1/8/21 $770.00 C @ $10.00 (+$1000)
1/8/21 – Expired 1 TSLA 1/8/21 $770.00 C
Profit +$1000
Peloton
The move I made with Peloton is an advanced move and might be hard to understand. I wrote about my Peloton trades and you can review at Tax Write-off Trades.
This post tries to explain my Peloton move. Along with buying my way out of the options I did a Roll-out. These 2 trades below and Calls I sold as part of the Roll-out. The 2nd Call which is a 10 contract is a Naked Call. Both expired without assignment. The money continues to flow in with the closing of my original Covered Call.
12/22/20 – Sell to open 20 PTON 1/8/21 $175.00 C @ $5.00 (+$10,000)
1/8/21 – Expired 20 PTON 1/8/21 $175.00 C
Profit +$10,000
This is the Naked Call.
12/22/20 – Sell to Open 10 PTON 1/8/21 $180.00 C @ $5.00 (+$5000)
1/8/21 – Expired 10 PTON 1/8/21 $180.00 C
Profit +$5000
Inseego
This is the trade I talk about in the beginning of this report. I made this trade in my car on my way to Boston yesterday.
4/30/20 – Buy to Open 20 INSG 1/21/22 $12.50 C @ $5.10
1/8/21 – Sell to Close 20 INSG 1/21/22 $12.50 C @ $6.10
Profit +$2000
Palantir
This is the 1st trade of my new section “The Grasshopper Field.” All Grasshopper trades will be listed in “The Grasshopper Field” on the page Grasshopper Trades.
This was a 1 contract Covered Call with Palantir where I was assigned. I made $75 on the stock sale and the $75 premium for a total of $150. This was a great Grasshopper trade. This was a 1 week trade with a return of 6.3%. I invested $2375 on the stock and made $150. This might not sound like a lot but it’s a 6.3% return. This is the type of trades a Grasshopper needs to make. Your account will build “slow and steady, steady and slow.”
Grasshopper Trade
1/4/21 – Buy 100 Shares PLTR @ $23.75
1/8/21 – Assigned 100 Shares PLTR @ $24.50
Profit +$75
1/4/21 – Sell to Open 1 PLTR 1/8/21 $24.50 C @ 75¢ (+$75)
1/8/21 – Expired 1 PLTR 1/8/21 $24.50 C
Profit +$75
Total Weekly Gain +$31,250
This was probably the best start to a new year I ever had. This is a crazy amount of money to make in the 1st week of the year. Let’s hope it can continue!
I’m in a hotel in Boston, if you have any questions now is a good time to send an email.
Watch for my report for my goals for 2021.
Successful trading,
Steve
The Options Coach