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Showing posts with label SPX 10/26/2018 2715 calls. Show all posts
Showing posts with label SPX 10/26/2018 2715 calls. Show all posts

Thursday, October 25, 2018

Options trade: SPX short call options (bearish trade)

Thu. 10/25/2018

Trade 1 (9:38:02 am, PT)  ← SPX around 2698

sell short -6 Oct 26, 2018  2715 calls at $11.30 (very nice premium!)

delta:  35.80


Trade 2 (1:01:11 pm, PT)

buy back calls at $10.40 (for a quick profit)

PROFIT:  $540


Comments:

  • SPX continued to rise after I sold (to open) my short call options (bad!)
  • At 11:49 am (2 hours later), SPX hit a high of 2722.33 and my calls were trading at $20.20 (I had a temporary "paper loss" of $5340!)  😖😨
  • At 1:01 pm, PT, I decided to buy back my calls at $10.40 and take a quick profit because I wasn't sure if Amazon's earnings and Alphabet's (Google) earnings were going to be good or bad
  • Amazon's earnings and Google's earnings turned out to be bad, so SPX dropped in the after-hours market 
  • By 1:15 pm, PT, my call options were trading between $5.40 and $6.50 😩
  • The greedy side of my brain wants to say, "I wish I had held my calls longer!"
  • The conservative side of my brain says, "It's a good thing I took my profits because things could have gone the other way."

What would YOU have done in this situation??

Learn to SELL CALL OPTIONS HERE!