Friday, July 10, 2015

GM option trades

I made a couple of GM options trades recently.

First, a couple of days ago, I closed my Jan 2015 $40 covered call which gave me a net profit of $64.60.

Next I wrote a $37 Jan 20 2017 covered call this morning that is shown below. If I hold on to the option until maturity I will earn $273.55. So far I have not held any options to maturity. I also still have open covered calls in BP, BBL, and now GM again. These can be found on my Options tab above.

To lose the shares, GM would most likely have to trade above $38.50. I have no problem losing the shares in that price range. Also if I don't lose the shares, the 200 shares will pay $432.00 in dividends over the next 6 quarters. Including the option premium, I could potentially receive $705.55 in total income from GM over the next six quarters.. That sounds pretty good to me!!!

If the share price drops considerably from the current $31 level, I will close the option early and realize whatever percentage of the option that I have earned.

Hopefully I have explained everything accurately.

Action: Sell to open
Description: GM JAN 20 2017 37.00 CALL
Quantity*: -2 contracts
Execution time: 07-10-2015 10:04 ET
Price: $1.41
Total Commissions & Charges: $8.45
Total Transaction Amount: $273.55
Trade Settlement Date: 07-13-2015         

So far in 2015 I have earned $385.90 on the four completed options trades.


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