I was able to check the market yesterday before we walked down to the beach and again after closing. I had a couple of trades while away for two days. The first was a limit order I entered a few days earlier on VIP naked calls. While VIP was trading somewhere near $25.40 on Monday morning my limit order hit and I sold four VIP September 25 naked calls (VIQIE) and received $987.00 after commissions. That was the high trade of the day for that strike. VIP cut its gains before lunchtime and I had a quick profit.
If only the picture was really that pretty. I’m long 200 shares of VIP that with August 30 covered calls on those shares. I also have 200 shares I’ll be assigned in a few days from two August 30 naked puts I sold a while ago. While I called these latest call options “naked”, they’ll turn to “covered calls” as soon as options expiration rolls around at the end of the week. I won’t be selling any new naked puts on VIP until I’m out of this position. 400 shares is plenty for a stock that is down for no other reason that political uncertainty in Russia. If my shares are called away in September, I’ll be somewhere close to breakeven on the whole series of trades I think. I’ll check later to verify. I sold these calls now to try to squeak out a little extra premium from time value on a spike. That’s exactly what happened, so now I’m back to being in the wait and see mode. If VIP looks like it’s heading farther south, I’ll dump my shares and maybe the calls too.
A second exchange of funds might not be considered as much of a trade by some. I was finally assigned 200 shares of CHK from the August 60 naked puts (CHKTL) and paid $12,019.99 with commissions. I consider this a trade because I paid commissions on it and I now own 200 shares that I didn’t yesterday. My new CHK shares were assigned at the open today meaning that someone pulled the trigger on the options they owned (and I sold) yesterday. CHKTL had virtually now time value left with the close at $16.60 yesterday for the option and $43.53 for the stock. Lucky for me CHK ended the day up $1.50 today and since I was on the highway returning from the beach I didn’t sell covered calls on my new shares yet. I probably will tomorrow instead of trying to time the stock. Worst case to the upside is that if I sell two October 50 covered calls and CHK jumps, I’ll have $1k from stock appreciation and $500+ from the options’ premium. I could sell September covered calls and guarantee a full profit on either the new covered calls or the September 42.50 naked puts I sold earlier. I’ll make that decision tomorrow. I’m going to watch the Olympics and try to recover from my vacation.