The account executed a trade with the same stock as the previous trade. The account sold the November calls against the stock it currently holds. The reasons for the trade are as follows:
- The revenue received from selling the call knocked down the cost of shares on the trade and increased the overall profit. This has created a situation where the overall cash holdings of the company currently are more than the cost basis for this trade. This provides a high level (not perfect) of protection for the trade.
- The cost of the trade was decreased since the action of purchasing new shares was not required
- Product development results are expected to be released before option expiration creating an opportunity for the stock to appreciate to and past the strike price
- As always, I do not fully divulge information on companies that have trades open. This is to protect the trade. When the trade on a particular stock ends, I will give out the rest of the details (stock name, price purchased, call purchased, news on company/ETF, chart info) that sort of thing. Please feel free to ask questions and I will answer them the best I can without endangering the trade.