This week:
Another double dip - this time in Starbucks
What to do with my Walgreens position?
Double dipping in Starbucks
Last week's I said I had an order in to close my SBUX trade for $0.40.
That order got hit basically first thing on Monday morning - I sold the option for $1.76 and closed it for $0.40, so I made $136 on the trade, or 77% of max profit.
On Thursday, we had the first live trading session as part of the founding batch for my options course - and SBUX popped up as a stock with an opportunity and a new position was initiated.
I sold 1 put at the $77.50 strike expiring on 21 October (Circle 1) for an initial credit of $89 (Circle 3), which is currently trading at $114 for an unrealised loss of $25.
Starbucks has been a great stock to trade all year.
From the screenshot above you can see realised gains of $1,226 year-to-date and only $5 paid in commissions and the only unrealised losses being the $25 on the new trade.
Compare this to just buying stock and being down 27.86% since 1 Jan 2022.
I know which ahem option I'm picking.
Dealing with my Walgreens position
For my WBA position, things are not looking up. I sold a put at the $35 strike expiring on 7 October (Circle 1) and received $112 for the trade (Circle 3)
It was a $26 unrealised loss last week, which has ballooned to -$118 this week (Circle 2), an unrealised loss of over 100%
I went into quite a bit of detail during our live portfolio review - and basically I am going to leave this position all the way until expiry, even though it's very close to meeting my criteria for rolling the trade.
If it gets assigned, 100 shares gets added to my existing 210 shares of WBA and will lower my cost basis even further which is great and I can turn around and sell covered calls at a lower call strike.
If it doesn't get assigned, that's great too - I'll take the premium and move on to the next trade.
If I wasn't already holding stock and I didn't want to take assignment of 100 shares of WBA, I would be seriously considering taking action to roll this trade out this week to avoid the risk of early assignment.
This article is for educational purposes only. This is my own portfolio which is being managed according to my goals and risk tolerance. Your situation is likely different and you should do your own due diligence before investing in stocks or options.