Wednesday, September 28, 2016

XOM covered call closed

Yesterday afternoon I decided to close out my covered XOM call. The details can be seen above.

Originally I sold a $90 XOM call and received a $237.30 premium. Since Exxon was trading around $82 yesterday and I had essentially earned 72% of the premium after subtracting all fees, I decided to buy back the call for $67.70.

This left me with a net profit of $169.60.  Not too bad especially when combined with the $336 ESV call profit also shown in the picture above.

XOM has traded as high as $96 this year which put me "upside down" on this trade most of the year. For a while I was concerned that I might have to sell the shares at $90.00, but the shares came back down and I decided to take the option profit and remove the possibility of losing the shares.

I was extremely fortunate with my timing as XOM is trading up about $3.50 today at a price of about $86.50. Most likely all of the option profit would have vanished with today's price action.

I am tempted to resell another call and start the process all over again.



  1. Excellent timing on buying it back. I typically try to do that has well...I buy it back if I can lock in at least 50% profit inclusive of trading commissions.

    1. Scott,

      Thanks. I went ahead and closed early mainly because energy has really fluctuated this year and for and extra $60 it's not worth tying up the stock and potentially losing it.