Today we closed two option contracts after closing one yesterday. Two were quite profitable, but another roughly broke even. With two weeks before the end of the year we have closed $22,059.13 in option profits in 2020. Using, as a base, our total cash balance - averaged across the twelve months - that’s a 14.3% return.
On Tuesday, our covered call option contract of Appian (APPN) closed on our initial closing limit order after I had initiated the position just the past Friday. APPN has been very volatile lately, but I was surprised to have sold the call contract (strike: $200; expiration: 15JAN2020) for $529.29 when the market price for APPN was roughly $150. Maybe I could have squeezed an extra $100-200 off the trade, but I didn’t want to be greedy – and netting $228.60 in four days is not bad.
Today I closed another covered call for Starbucks (SBUX) this time and we closed for the price we received 33 days before to initiate the short position in the call option contract (strike: $105; expiration: 18DEC2020). We are due to have a new pandemic relief effort any day and the market is roughly at the strike price so I thought I’d close this option and roll up and out another SBUX covered call.
We also closed a cash-covered put option contract for Match.com (MTCH) today after holding it for two weeks. MTCH has been on fire all year. This contract (strike: $125; expiration: 31DEC2020) was closed for $15 with two and a half weeks to expiration while the market was almost 20% above the strike price. We netted $183.61 on the trade for a 1.5% return on the collateral or 38.3% on an annual basis.