I was down by almost $3200 again today by the end of my lunch break. That’s when everything changed. I ended the day up almost $350.
I sold 2 MRO Feb 50 calls (MROBJ) and received $149.50 after commissions. This trade was to cover my Feb 50 puts and give me more cushion to the downside.
I sold 2 MRO Feb 45 covered calls (MROBI) and received $368.50 after commissions. This trade was to cover the 200 shares I own already. MRO was down another $3+ when I sold these new two sets of calls and it ended the day up more than $0.50. Clearly I wasn’t expecting such a rally as I left a bunch of money on the table.
I sold 1 BA Feb 80 call (BABP) and received $109.25 after commissions. This was to cover my 100 shares of BA I already own. I have two other Feb 85 calls by themselves still too. I am banking on BA not rallying $8.50+ in the next 17 trading days.
I sold 2 ADBE Feb 35 calls (AEQBG) and received $108.50 after commissions. ADBE was down another $1 or so when I made this trade. It closed up $0.33. This trade was to cover two Feb 40 naked puts I have a fat paper loss on. I’m basically securing a loss for myself if ADBE closes at expiration above 35. That’s fine with me. I’m ready to start with a clean slate again and get to pull some extra profit out of a bad trade with this, assuming ADBE doesn’t rally $6+ before Feb expiration.
I sold 1 NYX March 80 covered call (NYXCP) and received $254.25 after commissions. This was to cover the 100 shares that were assigned to me on Tuesday at 85. If this is called away, I’ll be close to break even on the two option trades together after subtracting my stock losses. Buy at 85, sell at 80, but collect ~$475 in premiums in between. If NYX doesn’t close above 80 on Feb 15th, I’ll be able to re-write another call (and maybe another naked put) and end up with a profit.
I sold 4 NVDA Feb 25 calls (UVABE) and received $567.00 after commissions. This was to cover my 4 NVDA naked puts I sold at the Feb 32.50 strike. I’m expecting to accept my loss on NVDA and move on. If NVDA doesn’t rally much, I might be able to re-write more calls.
All of the trades are ones I should have made days ago. I finally had a capitulation moment myself I guess. That’s why the market turned today, all because I gave in. (Joking of course).
I have 20 different options I’m short right now. I’ll update my portfolio page by the end of the weekend at the latest. Most of the trades I made today and yesterday were to point me back to somewhat of a more Delta Neutral (I’ll write more about the Greeks another day) range. I was far too bullish. (I messed with the bull and got the horns.) For example, on MRO I owned 200 shares (positive 200 delta) and was short two naked puts (positive 125.20 delta). I sold the 2 Feb 45 calls (negative 133 delta) and sold the 2 Feb 50 calls (negative 71.80 delta) to bring a more stable total portfolio that had a better chance to profit with either direction the market turned.
I don’t track my delta often, but know I should in markets like this. Generally I’m just balls to the wall positive delta, ie long positions. I brought in another $1556.00 in premiums today. That’s a lot of time value I’m expecting to vanish in the next few weeks. I also accepted a lot more upside risk than I typically carry. I don’t think the rally started this afternoon will have legs. The question remaining will be how far and long will these weak legs carry it. I’m betting big it won’t be too long before someone remembers the fundamentals will take time to return.