March Option Investing – Covered Calls

March option investing…already?  Really?

My February calls for DRN, EDC, and ERX were exercised, while the FAS calls expired, which means that my shares of DRN, EDC, and ERX were assigned.  That also means January’s focus on improving profitability was a  success!  The paper gains from January are real gains for February, and should show up in my February paper income report.  I say should because I’m still not 100% positive that I am accounting for the capital gains properly.

My basic technical analysis for February showed short-term uptrends had either reached or breached the next level of resistance. For March option investing, I’ll use out-of-the-money (OTM) calls again.

I expect some consolidation of the recent gains, with DRN, EDC, ERX, and FAS showing the potential to head higher.  TMF looks to be range bound, which would normally be ideal for covered calls.  But a broken, long-term uptrend coupled with an inability to have naked options keeps me out of this ETF for March.

I entered orders last Monday, but it took some time for the option prices to reach the price limits I set.

ETFs (Bought)

  • DRN – $63.49
  • EDC – $114.06
  • ERX – $58.91
  • FAS – $90.04 (Purchased on 2/7)

Calls (Sold)

  • DRN – $64.00 call @ $2.35
  • EDC – Open
  • ERX – $60.00 call @ $2.35
  • FAS – $93.00 call @ $1.16 (UPDATE – Expired Feb 24)
  • FAS – Open

About T. Knight
Blogging about my journey to financial independence via investing for cashflow.

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