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So Much For Patience

Byadmin

Yesterday, I was talking about patience.

Today, I reviewed my original post talking about the trade. I said I would aim to take 75% of the profits if I could. 75% of $1.09 is $0.81.

Looking at this now, I think I made a mistake. I am not sure. Just on the option itself, which was closed today, I made $4.48 per share because the options fell from $17.75 to $13.27. That is more than the $1.09 I was hoping to make. But the stock fell as well, wiping out some of those gains. So, I only made $0.62 if you remove the amount that BABA fell (unrealized). That’s more than 50% of what I aimed to get, but not 75% as I had planned.

But then again, I was able to sell a new call for a new month, collecting more time and more premium to decay.

Or you can look at it as a lower cost basis in BABA.

  • BUY TO CLOSE (BTC), BABA CALL, NOV 17 2023, 70 STRIKE
  • SOLD TO OPEN – $17.75
  • BOUGHT TO CLOSE – $13.27
  • PROFIT – $4.48 per share

I decided to roll that option to December. But I wasn’t seeing reasonable prices for the $70 strike in December. So I checked January, and surprisingly, I could get some additional option premiums in January.

  • SOLD TO OPEN (BTC), BABA CALL, JAN 19 2023, 70 STRIKE
  • SOLD TO OPEN – $15.09

This option currently has $2.20 of extrinsic value, which I hope to capture between now and January. I will roll it again if I can buy this back for $1.65 profit.

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