Experiencing the Allure of Options Trading| MU & NVDA Call

Personal Milestone:

20240516 marks a memorable day for me as I placed my first-ever options trade. With a bullish outlook on $Micron Technology(MU)$ and $NVIDIA Corp(NVDA)$ , I ventured into the options market.

Trade Details:

• Trade Execution: After market opened at 9:30 ET on the 16th, I purchased MU options contracts set to expire on 24th June, with a strike price of $140, labeled "MU 20240624 140.CaLL."

• Purchased 2 $NVIDIA Corp(NVDA)$ call contracts set to expire on 24th june, with a strike price of $960, Contract cost $40.9625

• Confidence Level: I had a strong conviction about the short-term target price, which was a key factor in my decision to trade.

• Transaction Summary:

  • MU Call buy cost: $4.3225 per contract, and $43.35 for 10 lots.

  • NVDA Call buy cost: $20.48 per contract, and $40.96 for 2 contarcts

  • Sell Time frame: Sold the contracts around 10:30ET at $4.7 per contract for all 10 lots.

    

Profit Calculation:

• The realized day profit on MU CALL was approximately $370, calculated as($4.7 - $4.33) * 1000 shares.

• Still holding NVDA contract.

  

Potential Max Profit:

• The $Micron Technology(MU)$ options reached a peak of $5.07 at 11. If sold at this peak, the profit would have been a substantial $740, calculated as ($5.07−$4.32) * 1000.

Reflections and Learnings:

1. As a novice in options trading, I ensured the number of contracts was within my capital's risk limits and did not employ leverage to amplify returns and risks.

2. Time management is key, I aimed to complete the trade in the first half of the day to secure profits.

3. While short-term contracts are not to be held overnight, longer-dated contracts on fundamentally strong stocks can be a viable strategy.

4. It's imperative to maintain a steady mindset and ensure trading does not disrupt daily life.

5. If bought the options contact going expiration on May 17, it was crucial to close the position promptly to avoid a potential sharp decline in the option's value.

My Trading Conclusion:

"Experiencing the allure of potentially 'getting rich instantly' through options trading, even with a conservative approach, was exhilarating. With a small initial gain, the potential for significant returns is enticing. It's clear why there's such a buzz around successful trades in tiger community, cheers. It's never too late to learn and improve, thank you for listening and happy investing."