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| NEW TRADE ALERT |  | ||||
| Tuesday, March 31, 2020 | |||||
| Cash Secured Put Option Buy Back | |||||
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| Closed a position with Goldman Sachs (GS) this week | |||||
ORIGINAL TRADE
| TRADE KRUM! (see details below) | DAYS | Cash on Cash % | Annualized | |
| -$421.04 | 22 | -2.37% | |||
| The trade results and did it meet expectations? | |||||
| Decided to take a loss on this Cash Secured Put I placed on GS back on Mar-9 because its becoming very clear to me that I will probably be early assigned or will be assigned these signs at a much higher price then what I want to be assign them. The spreadsheet below shows it perfectly ... I would rather lose -$414 then assume a -$15,000+ loss handed to me from day one ... I will try to ROLL this CSP to a ATM CSP and try to mitigate this loss with a credit. | |||||
| ORIGINAL TRADE BREAKDOWN | |||||
| DATE | COMPANY | SYMBOL | SHARES | STOCK WAS | |
| Mar-9 | Goldman Sachs | GS | 100 | $177.50 | |
| STRIKE | EXPIRATION | PREMIUM RECV | CONTRACTS | CoC % ROO | |
| $177.50 | Jan-15 | $16.00 | 1 | -2.37% | |
BUY BACK
| WHY DID I BUY THIS OPTION BACK? | ||||
| read above on this one | |||||
| RESULTS FROM THE OPTION BUY BACK | |||||
| SYMBOL | WHEN STOCK WAS TRADING @ ~ | CASH PROFIT | |||
| GS | $177.50 | -$421.04 | |||
| PREMIUM RECV | BUY BACK PRICE | REAL $ ? | DIFFERENCE / TV $ | CoC% GAIN | |
| $16.00 | $20.20 | $0.00 | -2.37% | ||
| Always look at a company's chart ... it tells a story and that story could be UP or DOWN | |||||
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| Education Corner | |||||
| Great Covered Call video posted at | |||||
| Cash Secured Put - Description -The cash-secured put involves writing an at-the-money or out-of-the-money put option and simultaneously setting aside enough cash to buy the stock. The goal is to be assigned and acquire the stock below today's market price. Whether or not the put is assigned, all outcomes are presumably acceptable. The premium income will help the net results in any event. The investor is bullish on the underlying stock and hopes for a temporary downturn in its price. If the stock drops below the strike, the put may be assigned. That would allow the put writer to buy the stock at the strike price. The effective purchase would be even lower: strike price less the premium received. There are two principal risks. First, the stock might not only dip but plummet well below the strike price. The investor must be comfortable with the strike price as an acceptable long-term acquisition price, no matter how low the market goes. Source - https://www.optionseducation.org/strategies/all-strategies/cash-secured-put | |||||
| Disclaimer - Yes - at the time of this posting I do have a position in this equity. By posting this I am by no means recommending this equity and am not front running for its performance. I have risked my own money and am accountable for the trade results. | |||||
| Image credits - stockcharts.com | barchart.com | foolcdn.com | yahoo.com | earningswhispers.com | |||||
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