📈 Mid‑Week Options Report — Volatility, Rotation, and $1,548 in Realized Premium
This week’s tape delivered exactly what active derivatives traders look for: volatility, dislocations, and asymmetric premium opportunities. A structural reset of the book earlier this month is already paying dividends — not through luck, but through disciplined execution, rapid rotation, and a clear hierarchy of risk.
Below is the full breakdown of the week’s activity.
🟥 INTU Earnings Collapse — A Volatility Event Worth Trading
INTU’s earnings release on May 20 delivered headline beats on both EPS and revenue:
EPS: 12.80 vs 12.57 expected
Revenue: $8.56B vs $8.54B expected
But forward guidance disappointed, valuation cracked, and the stock suffered a –19.75% single‑session decline, erasing nearly $76 per share.
This was a textbook volatility event — and an opportunity.
1️⃣ INTU — Sold $300 Cash‑Secured Put (5/29) — $600 Premium
The moment INTU flushed, I stepped in and sold the $300 CSP into the volatility spike.
Strike: $300
Expiration: 5/29
Premium: $6.00
Credit: $600
Effective Entry: $294
This was a reaction trade executed in real time — sell premium into panic, not after the rebound.
2️⃣ HD — Closed $275 CSP Early — +$197 Realized
HD was a profitable position, but once INTU collapsed, capital needed to be reallocated to the higher‑quality setup.
Opened: $3.80
Closed: $1.83
Profit: $197
A straightforward capital rotation decision.
3️⃣ UNH — Rolled $400 Covered Call (5/22 → 5/29) — +$160 Credit, $755 Total Profit
UNH delivered one of the cleanest income cycles of the week.
Old Call: $400 (5/22)
New Call: $400 (5/29)
Roll Credit: $160
Total Profit This Cycle: $755
A classic covered‑call sequence: harvest decay, roll forward, maintain strike integrity, and continue generating income.
4️⃣ RDDT — Rolled $157.50 CSP (5/22 → 5/29) to $155 Strike — $416 Profit
RDDT’s elevated volatility created an ideal roll‑down opportunity.
Old Contract: $157.50 CSP (5/22)
New Contract: $155 CSP (5/29)
Profit Booked: $416
The roll locked in realized gains, improved the strike, and extended the premium cycle with controlled assignment risk.
5️⃣ RDDT — $187.50 Covered Call Bought Back at $0.06 — $74 Profit
The contract decayed to pennies, and the remaining extrinsic value wasn’t worth holding through expiration.
Strike: $187.50
Buyback: $0.06
Profit: $74
Closing early removed tail risk and freed the shares for the next cycle.
🟫 Post‑Trade Review: Closing the Earlier RDDT CSP Early
RDDT rallied shortly after I closed the earlier $147 CSP, and holding for another hour would have added roughly $150 in additional profit.
But the decision remains correct.
RDDT had traded down to $145 earlier in the session, making assignment risk real. Once INTU collapsed, the priority shifted to:
freeing capital
reducing correlated downside
avoiding simultaneous assignment in two high‑volatility names
sizing properly into the INTU CSP
Professional trading is judged by process, not hindsight. The process was sound.
6️⃣ ASTS — Rolled Covered Call $89 → $93 (Next Week) — +$56 Credit
Old Strike: $89
New Strike: $93
Credit: $56
A clean roll‑up and roll‑out, improving upside room while extending theta exposure.
7️⃣ HOOD — Sold $83 Covered Call (Next Week) — +$45 Credit
A small but efficient income scalp.
Strike: $83
Expiration: Next week
Premium: $0.45
Credit: $45
Shares continue working while implied volatility remains elevated.
📊 Weekly Income Summary
| Position | Action | Result |
|---|---|---|
| INTU $300 CSP (5/29) | Opened | +$600 |
| HD $275 CSP | Closed | +$197 |
| UNH $400 CC Roll | Rolled | +$160 (Total $755 cycle) |
| RDDT $157.50→$155 CSP Roll | Rolled | +$416 |
| RDDT $187.50 CC | Closed | +$74 |
| ASTS CC Roll $89→$93 | Rolled | +$56 |
| HOOD $83 CC | Sold | +$45 |
→ $1,548 generated so far this week
📌 Looking Ahead — No More Expirations This Week
All remaining positions have been pushed into next week.
Six contracts now set to expire next week:
INTU CSP
UNH CC
RDDT CSP
SLV CC
TTD CC
ASTS CC
HOOD CC
The next update will be published Tuesday, once early‑week volatility and order flow provide clearer signals.
No comments:
Post a Comment