I have to admit.
Most of the reasons for putting on this trade in the first place? Was to dispel some of the nonsense I see in various streams.
“Sellers of option premium always eventually blow up“
“NO ONE is bearish on XYZ stock“
“Rolling an option position, in the end … is simply realizing a loss. That’s all“
What a bunch of verifiable nonsense.
NVDA has provided an excellent opportunity to dispel that nonsense. So NVDA rallied a bit against me? Ok, well then I will dispel the nonsense of ‘rolling an option position, in the end … is just simply realizing a loss, and that’s all.‘
For the GTC Sample Portfolio, we closed down the previous NVDA March 8 Option position for a loss of 0.56, giving that trade a net loss of around -0.37 ( +0.22 of original premium – 0.56 exit = -34, plus a couple of cents in commissions ). Then we would resell, by selling the 1 NVDA March 8 905 Call, buying 1 March 8 920 Call for a net credit of 0.43. We still have a DTE of 7.
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