Monday, February 1, 2021

Options Update: January 2021

 Welcome to my monthly options update!

Here, I shall write monthly options update articles to keep track of options trades in my portfolio. Each options update serves as a status report on the open options and the obligations I have. A running tally of all my options trades and income to date are found on the Options page.

This was a quiet month for me, as I did trade any options.

Assigned Options

No option got assigned this month.

Expired Options

Two options expired next month:
Trade #41: Sold 1 SQQQ call option strike 52 exp 1/15/21 for $499.76 net premium on 12/20/18. 

Trade #55: Sold 1 FFIV put option strike 110 exp 1/15/21 for $1,388.87 net premium on 3/9/20. 

Closed Options

When an out of the money option goes further out of the money, one may close the option early and secure most of the options income.

I did not close any options this month.

Rolled Options

An option can be rolled forward by buying back an option and selling another option with a later expiration date. Rolling is done to avoid options assignment for in the money options.

I did not roll any options this month.

New Call Options Sold

Selling calls is a way to earn premiums from time decay on securities that are unlikely to reach a certain strike price within a certain time frame. This is best done on stocks you already own so as to limit liabilities should the underlying security shoot to the moon.

I did not sell any call options this month.

New Put Options Sold

Selling put options is a way to earn premium for agreeing to buy a stock at a given price for a period of time. This is best done with high quality, buy and hold stocks that have limited downside.

I did not sell any put options this month.

Options Expiring Next Month

No option will expire next month.

Cumulative Options Income Summary

As of January 2021:

                             Cumulative      Cumulative Secured
                          Options Income    Options Income
    
This Month:           $ 20,619.01            $   8,164.50
Last Month:           $ 20,619.01            $   6,275.87
Difference:             $              0            $    1,888.63

Current unrealized gain/(loss)*: $1,039.43, down from $2,921.93 last month, as I realized gains from the two expired options.

Total realized and unrealized gain/(loss): $9,203.93

*Note: Unrealized gain increases the chance of eventually securing option income, while unrealized loss does the opposite.

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