Or you can: Buy 100 AMC shares-To The Moon - Tiger Brokers Online Investing Community - To The Moon

Or you can:

Buy 100 AMC shares = -$6800

Sell 1 AMC $75 call = +$3000

Net cost for AMC = $38

(Take a look at all those calls, most strikes expiring > 2weeks from $60-80 are around $30, which is like 40-50% of security price! Price difference of each strike is smaller than the strike intervals!)

At expiry, if:

AMC < strike (calls expire worthless) = max gain $7500-6800+$3000 = $3700

AMC >strike (I get exercised) = Max gain capped $3700

AMC stay at $68 = gain $3000

AMC tanks = $6800-$3000= $3800 max loss (I lose net cost of shares)

Unfortunately, tiger brokers does not support covered calls. After chatting with Customer Support, I was told “system does not support covered calls”.

I was told that in the event of further price increase, I would be asked to deposit more and more funds, or else the will liquidate my holdings, including the AMC shares. If they liquidate those, my covered call will become a naked call.

My losses should have been capped to what I paid for the shares, less option premium received (about $38/share). Instead, it could become *unlimited*. This results in sabotaging the entire trade and destroying my relatively secured position.

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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.

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Price difference of each strike is smaller than the strike intervals!)</p><p>At expiry, if:</p><p>AMC &lt; strike (calls expire worthless) = max gain $7500-6800+$3000 = $3700</p><p>AMC &gt;strike (I get exercised) = Max gain capped $3700</p><p>AMC stay at $68 = gain $3000</p><p>AMC tanks = $6800-$3000= $3800 max loss (I lose net cost of shares)</p><p>Unfortunately, tiger brokers does not support covered calls. After chatting with Customer Support, I was told “system does not support covered calls”.</p><p>I was told that in the event of further price increase, I would be asked to deposit more and more funds, or else the will liquidate my holdings, including the AMC shares. If they liquidate those, my covered call will become a naked call.</p><p>My losses should have been capped to what I paid for the shares, less option premium received (about $38/share). Instead, it could become *unlimited*. This results in sabotaging the entire trade and destroying my relatively secured position.</p></body></html>","htmlText":"<html><head></head><body><p>Or you can:</p><p>Buy 100 AMC shares = -$6800</p><p>Sell 1 AMC $75 call = +$3000</p><p>Net cost for AMC = $38</p><p>(Take a look at all those calls, most strikes expiring &gt; 2weeks from $60-80 are around $30, which is like 40-50% of security price! Price difference of each strike is smaller than the strike intervals!)</p><p>At expiry, if:</p><p>AMC &lt; strike (calls expire worthless) = max gain $7500-6800+$3000 = $3700</p><p>AMC &gt;strike (I get exercised) = Max gain capped $3700</p><p>AMC stay at $68 = gain $3000</p><p>AMC tanks = $6800-$3000= $3800 max loss (I lose net cost of shares)</p><p>Unfortunately, tiger brokers does not support covered calls. After chatting with Customer Support, I was told “system does not support covered calls”.</p><p>I was told that in the event of further price increase, I would be asked to deposit more and more funds, or else the will liquidate my holdings, including the AMC shares. If they liquidate those, my covered call will become a naked call.</p><p>My losses should have been capped to what I paid for the shares, less option premium received (about $38/share). Instead, it could become *unlimited*. This results in sabotaging the entire trade and destroying my relatively secured position.</p></body></html>","text":"Or you can: Buy 100 AMC shares = -$6800 Sell 1 AMC $75 call = +$3000 Net cost for AMC = $38 (Take a look at all those calls, most strikes expiring > 2weeks from $60-80 are around $30, which is like 40-50% of security price! Price difference of each strike is smaller than the strike intervals!) At expiry, if: AMC < strike (calls expire worthless) = max gain $7500-6800+$3000 = $3700 AMC >strike (I get exercised) = Max gain capped $3700 AMC stay at $68 = gain $3000 AMC tanks = $6800-$3000= $3800 max loss (I lose net cost of shares) Unfortunately, tiger brokers does not support covered calls. After chatting with Customer Support, I was told “system does not support covered calls”. I was told that in the event of further price increase, I would be asked to deposit more and more funds, or else the will liquidate my holdings, including the AMC shares. If they liquidate those, my covered call will become a naked call. My losses should have been capped to what I paid for the shares, less option premium received (about $38/share). Instead, it could become *unlimited*. This results in sabotaging the entire trade and destroying my relatively secured position.","highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"favoriteSize":0,"link":"https://ttm.financial/post/111742899","repostId":1105752559,"repostType":4,"isVote":1,"tweetType":1,"viewCount":255,"commentLimit":10,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"symbols":[],"verified":2,"subType":0,"readableState":1,"langContent":"EN","currentLanguage":"EN","warmUpFlag":false,"orderFlag":false,"shareable":true,"causeOfNotShareable":"","featuresForAnalytics":[],"commentAndTweetFlag":false,"andRepostAutoSelectedFlag":false,"upFlag":false,"length":961,"xxTargetLangEnum":"ORIG"},"commentList":[],"isCommentEnd":true,"isTiger":false,"isWeiXinMini":false,"url":"/m/post/111742899"}