Monday, June 11, 2007

Good Monday Morning

Bought 200 TRW @ $38.56

I have been wanting to experiment with options. There is only so much one can do on paper, so I decided to sell some covered calls today. I sold 5 June 15s @ .20 of SWHC. This netted a profit of $86.00 I'm not really concerned if the shares get called or not. In terms of learning how everything works, I'm kind of hoping they do get called so I can find out how my platform handles it and how I am notified. If they do get called, I will have netted about $160.00 from the trade.

More later...


Darren said...

You're selling short the calls to hedge your long in the common, is that correct?

Woodshedder said...

Technically yes. However, the 86 buck premium doesn't really hedge much. I'm really just experimenting with options. With expiry only 4 days away, I figured it might be a good time to play around. If the underlying tanks, I will buy the call and sell the underlying, for hopefully not too big of a loss.