3 Winners out of 4 Trades
January Option Expiration Update
Sell to exit January Long Calls in Starbucks and Emerging Markets ETF for profit.
Sell to exit January Blackberry Long Call for small loss.
WHEEL IT… Southwestern Energy and Seadrill
The strategy to sell cash secured puts is a method to buy stock at a discount or get paid not to… taking advantage of the market fears and volatility with high probability plays.
Below updates the January positions that go off the board at end of today Friday.
16% return in two months– NUGT Gold Miners ETF Sold December $7.50 Put at $0.45. Stock assigned at $7.15. A January $7.50 Covered Call was sold at $0.65 to lower cost basis to $6.50. Current NUGT price $10.05 so covered call will take away shares for a $1.00 profit.
OPTION WHEEL UPDATE
Originally sold Southwestern Energy November $11 Put at $0.55. with stock assigned at $10.45. Later, sold the December $12 Covered Call for $0.40 to lower cost basis to $10.05. Then sold the January $12 Call for $0.30 to lower cost basis to $9.75.
With shares at $9.50, the $12 Call will expire out of the money. A February covered call will be sold to again lower cost basis.
Originally sold SEADRILL May $4 puts for $0.25 http://www.bullseyeoption.com/trade-alert/new-trade-alert-may-2nd-seadrill/ to put break even basis at $3.75.
SDRL stock was assigned with July $4.00 covered call sold for $0.25 June 7th on long shares to lower stock cost again to $3.50.
A February covered call will be sold to again lower cost basis.