How I Profited $37 in Just One Hour with a Covered Call Strategy 💰
How I Profited $37 in Just 6 Houra with a Covered Call Strategy 💰
What Is a Covered Call? 📊
A covered call is a conservative options strategy where you sell a call option against shares you already own. By selling the call, I agree to sell my shares at a specific price (strike price) if the buyer exercises the option. In return, I get paid a premium, which adds to my overall return.
In this case, I owned 100 shares of Palantir Technologies (PLTR), purchased on December 27, 2024, for $78.32 each. Later that day, I sold a call option with a strike price of $77 that expired on the same day (zero-day expiration).
How I Made 0.5% in an Hour 🚀
Here’s what happened step-by-step:
1. Bought Shares: I purchased 100 shares of PLTR at $78.32 on December 27.
2. Sold a Call Option: I sold a call at a strike price of $77, taking a premium of $1.69 per share (total $169).
3. Quick Expiry: The call option expired on the same day, and the shares were assigned (sold) at $77.
Here’s the breakdown of my profit:
• Premium Earned: $169 from selling the call.
• Share Sale Loss: $78.32 - $77 = -$1.32/share (-$132 total).
• Net Profit: $169 (premium) - $132 (loss) = $37.
While this may not sound huge, it’s a 0.5% return in just one hour. If I consistently make these moves, it could lead to significant returns over tim$Palantir Technologies Inc.(PLTR)$
!
What Is Zero-Day Expiration? ⏳
Zero-day expiration refers to options that expire the same day they are traded. These are high-risk, high-reward options because the time for price movement is minimal. I sold a zero-day expiration call on PLTR, making a quick profit as the option’s value dropped rapidly, and the stock price stayed within range.
My Takeaway 🎯
This strategy works best if you don’t mind selling your shares or have a target sell price in mind. By using a covered call, I reduced the cost of buying shares and locked in a small but steady profit within hours.
Disclaimer: Options trading involves risks and isn’t suitable for everyone. Always assess your risk tolerance and strategy goals before trading. 😊
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Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
- Margaritas·2024-12-29Sbc markets said you can do rolling covered calls - is this a viable strategy when shares are going up? What point d do you take profit1Report