NVDA
Got assigned on my NVDA
The Trade (1st June 2007)
Shares/Contract = 100
Buy 500 NVDA @ $34.93 (-$17,465)
Sell 5 NVDA 35 Calls @ $0.85 (+$425)
NVDA closed @ 34.88 on this day
I was exercised/assigned (15th June 2007)
Sell 500 NVDA @ $35 (+$17,500)
NVDA closed @ 39.55 on this day
Net Transactions: -$17,465+$425+$17,500 = $460
Brokerage = $14.95 * 3 + $0.27 + $0.01 = $45.13
Net Profit = $414.87
Money in trade: $8,520
ROI: $460/$8,520 = 5.4% (before brokerage & fees)
Some of you may be wondering I could have sold the stock for 39.55 and made $2,335 ($4.67*500). The answer to this question comes in a form of a question. “When you open a trade, how do you know what is going to happen in 15 days?”. What I effectively did was sell away my future profits which i may or may not have on the 15th June but definitely did not have on the 1st June 2007 to somebody for 85c
Anyways, now i’ve got cash… i’m going to look for a stock to do the same thing again. 5.4% return is pretty damn good in 15 days. If you guys want something safer than this try the TeleNet Saver accounts its currently Australia’s highest interest earning internet savings account @ 6.8 pa for the first 12 months. I highly recommend this if you have spare money and have no idea what to do with it!
For me i prefer 5-6% per month (60% - 72%pa) Just a little bit better than normal savings account!
Related Posts
