Expiration
Today is the expiration of our April Covered Calls. I don’t anticipate adjusting any of these positions today. Here are my thoughts on each …
Let’s start with Apple (AAPL), which is trading well above our short strike price of 245. We will not need to adjust this position and come Monday we will be left without a stock or option position. Net/net we will have a profit of $2,300 per covered call executed, or a yield of 10.22% in just over one month’s time.
Atlassian (TEAM) is our next position that I want to address, though this stock is going to be super interesting today as the stock is trading right at the 150 strike that we are short. Should the stock close below 150 the option we sold will expire worthless, we will continue to hold our stock position and then likely sell a new call Monday. Should the stock close above 150 we will be left without a stock position Monday and will have collected $570 in March, and $400 in April, or net/net a yield of approximately 7% in two month’s time.
Datadog (DDOG) is very likely going to close below the 43 strike that we sold. That being said, because we received such a big premium of $430 per call sold, our position is in good shape. Come Monday I will need to decide if we are going to take our profit and run, or sell a new call to create even more yield.
You do not need to address this position today and the call will simply expire worthless.
Nuance Communications (NUAN) is the position in April that is in the worst shape, though isn’t terrible. NUAN has recovered nicely since the March lows, and we will collect our full $70 premium from the April 23 call that we sold expiring worthless. Come Monday I will decide if we will sell a new call, or exit the position entirely.
You do not need to address this position today and the call will simply expire worthless.