13/4 My sell hot call options on stocks I owned
$Alphabet(GOOGL)$
Sure, I can update the calculations based on the new stock prices you provided.
Manulife at strike price $17 fetching me premium 1.90 for 2 months sold the call today.
Manulife's current stock price is $18.90, and you are selling a call option with a strike price of $17 and a premium of $1.90, which expires in two months.
If Manulife's stock price remains below $17 by the expiration date, you will keep the premium received from selling the call option. Your potential return is calculated as follows:
Return = (Premium received / Current stock price) x (Number of shares per option contract x 100) x (Option contract duration in days / 365)
Return = ($1.90 / $18.90) x (100 x 100) x (60 / 365) = 5.01%
This means that if Manulife's stock price remains below $17 by the expiration date, you will earn a 5.01% return on your investment over two months. However, if the stock price rises above $17, you may be obligated to sell your shares at that price, which could result in a loss.
QYLD strike price at $16 fetching $1.20 of premium for 2 months.
QYLD's current stock price is $17.22, and you are selling a call option with a strike price of $16 and a premium of $1.20, which expires in two months.
If QYLD's stock price remains below $16 by the expiration date, you will keep the premium received from selling the call option. Your potential return is calculated as follows:
Return = (Premium received / Current stock price) x (Number of shares per option contract x 100) x (Option contract duration in days / 365)
Return = ($1.20 / $17.22) x (100 x 100) x (60 / 365) = 4.66%
This means that if QYLD's stock price remains below $16 by the expiration date, you will earn a 4.66% return on your investment over two months. However, if the stock price rises above $16, you may be obligated to sell your shares at that price, which could result in a loss.
Google strike price $120 fetching me premium of $22 premium for 25 months.
Google's current stock price is $105, and you are selling a call option with a strike price of $120 and a premium of $22, which expires in 25 months.
If Google's stock price remains below $120 by the expiration date, you will keep the premium received from selling the call option. Your potential return is calculated as follows:
Return = (Premium received / Current stock price) x (Number of shares per option contract x 100) x (Option contract duration in days / 365)
Return = ($22 / $105) x (100 x 100) x (750 / 365) = 51.14%
This means that if Google's stock price remains below $120 by the expiration date, you will earn a 51.14% return on your investment over 25 months. However, if the stock price rises above $120, you may be obligated to sell your shares at that price, which could result in a loss.
It's important to note that selling options involves risks, and the calculations above are based on certain assumptions and may not reflect the actual outcome of the trade. It's always important to consult with a financial professional before making any investment decisions
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Good samples and explanations