Author: Bryan Halliday

We are buying more shares of OXY today and adding a 1×2 call spread against those shares. We currently own 125 total shares. We are buying 75 more to get us up to 200 shares total. And the 1×2 call spread is effectively a covered call of sorts as we would be “called away” from this 2nd 100 shares if the stock exploded higher. Bought 75 shares of OXY at 56.12 Buy to open:  OXY Jan 19th (monthly) 57.50 strike call (ratio of 1) Sell to open:  OXY Jan 19th (monthly) 62.50 strike call (ratio of 2) Debit:  0.78 Max risk of the 1×2 spread = 0.78 or $78.00 Max reward of the 1×2 spread = 4.22 or $422.00

Today in class we discussed this week’s options expiration. We reviewed all of our December expiration trades and those most likely to need an adjustment (DKNG, DELL & SNOW). We also adjusted our ITM covered LEAPS trade in VZ. And finally got filled on covered calls in TMUS and WBA which we had tried to sell a couple of weeks ago. The details are as follows: Rolled out and up on our VZ covered leaps short calls as follows: Buy to close:  VZ Dec 15th (monthly) 37.00 strike call Sell to open:  VZ Jan 19th (monthly) 39.00 strike call Debit: 0.51 – this order has been filled Sold covered calls on TMUS and WBA after having not been filled previously. Sell to open:  TMUS Jan 19th (monthly) 170.00 strike call Credit: 0.57 – this order has been filled Sell to open:  WBA Jan 19th (monthly) 27.50 strike call Credit: 0.38 – this order has been filled We added a new trade that was not discussed live in class. Bought a call butterfly in BABA as follows: Buy to open: BABA Feb 16th (monthly) 75.00 strike call (ratio of 1) Sell to open: BABA Feb 16th (monthly) 85.00 strike call (ratio of 2) Buy to open: BABA Feb 16th (monthly) 95.00 strike call (ratio of 1) Debit: 1.30 Max risk = 1.30 or $130.00 per spread Max reward = 8.70 or $870.00 per spread

We have closed our trade in ON as it is now moving to a new swing high. Sell to close:  ON Jan 19th (monthly) 75.00 strike put Credit:  3.75 – order filled We purchased the put for 4.92 and exited at 3.75 for a loss of -1.17 or -$117 overall. We have entered into a 1×2 call spread in BRKB against 100 of our shares as follows: Buy to open: BRKB Jan 19th (monthly) 360.00 strike call (ratio of 1) Sell to open: BRKB Jan 19th (monthly) 370.00 strike call (ratio of 2) Debit: 1.80 – order filled Max risk = 1.80 or $180.00 per spread Max reward = 8.20 or $820.00 per spread We are trying to roll-up our December covered call in DKNG as follows: Buy to close: DKNG Dec 15th (monthly) 35.00 strike call Sell to open: DKNG Dec 15th (monthly) 37.00 strike call Debit: 0.85 – pending order

We have rolled up our December covered call in SNOW as follows: Buy to close: SNOW Dec 15th (monthly) 190.00 strike call Sell to open:  SNOW Dec 15th (monthly) 195.00 strike call Debit: 1.15 – this order has filled We originally collected a credit of +2.53 so this would reduce the income down to +1.38 or +$138.00 overall.

We were holding out for a better price on Monday trying to enter a put butterfly in SNOW on earnings. This morning the stock gapped higher (it reports tonight after the close) and we got a much better price than expected. Buy to open:  SNOW Dec 1st (weekly) 165.00 strike put (ratio of 1) Sell to open: SNOW Dec 1st (weekly) 150.00 strike put (ratio of 2) Buy to open:  SNOW Dec 1st (weekly) 135.00 strike put (ratio of 1) Debit: 2.25 – this order has filled Max risk = 2.25 or $225.00 per spread Max risk = 12.75 or $1,275.00 per spread We also bought 2 contracts of put butterfly spreads in CVS as follows: Buy to open:  CVS Jan 19th (monthly) 67.50 strike put (ratio of 1) Sell to open: CVS Jan 19th (monthly) 62.50 strike put (ratio of 2) Buy to open:  CVS Jan 19th (monthly) 57.50 strike put (ratio of 1) Debit: 0.87 – this order has filled Max risk = 0.87 or $87.00 per spread Max risk = 4.13 or $413.00 per spread

We have closed our bull put credit spread in JD for a loss. Buy to close: JD Jan 19th (monthly) 30.00 strike put Sell to close:  JD Jan 19th (monthly) 27.50 strike put Debit: 1.22 The result is a loss of -0.26 or -$26.00 per spread.

We have closed and taken profits in our current GLD trade. However, we are placing a new trade in GLD at even higher levels. Sell to close:  GLD Jan 19th (monthly) 180.00 strike call (ratio of 1) Buy to close: GLD Jan 19th (monthly) 190.00 strike call (ratio of 2) Sell to close:  GLD Jan 19th (monthly) 200.00 strike call (ratio of 1) Credit:  3.70 – this order filled Profit of $1.45 or +$145.00 per spread traded. Entered into a new trade in GLD at higher price and a later expiration. Buy to open: GLD March 15th (monthly) 190.00 strike call (ratio of 1) Sell to open: GLD March 15th (monthly) 210.00 strike call (ratio of 2) Buy to open: GLD March 15th (monthly) 230.00 strike call (ratio of 1) Debit: 2.85 – this order filled Max risk = 2.85 or $285.00 per spread Max reward = 17.15 or $1,715.00 per spread If you factor in the +$145 profit we just locked-in, our total risk in trading GLD is now only 1.40 or $140 total. There are two (2) covered calls from the last few days that haven’t filled, trying again below: Selling a covered call in TMUS. Sell to open: TMUS Jan 19th (monthly) 165.00 strike call Credit: 0.40 – this is still a pending order Selling a covered call in WBA. Sell to open: WBA Jan 19th (monthly) 25.00 strike call Credit: 0.35 – this is still a pending order