I recently sold two covered calls for Silver. I received $132 (gross).
Today (11 am, 10/5/2010), silver was up 3.48%, but the silver call option was up 53.85% !!!
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UPDATE (expiration Friday, 11/19/2010):
SLV closed at $26.74 today. The call option is in-the-money => automatic assignment.
The call option closed at $4.70 today.
IMPORTANT NOTE:
This call option traded as high as $6.70 (11/9/2010) during its life!!!!!!!!!!
Remember......the BUYER of this call option paid only 66 cents per contract (10/4/2010).
Just one month later (on 11/9/2010), this same contract was worth $6.70!!!!! That is a return of 915% in four weeks !!!!!!!!!!!!!!!!!!!!
Another way to look at this:
An initial investment of only $660 (10 contracts) was worth $6700 on 11/9 !!!!!!!!
This is the reason I love options! :-)
(you can learn all about options trading in my Level 4 class.....see www.moneyandlilia.blogspot.com for details)
