Interesting $40,000 day today

[Java]

So I said I was going to go back to boring Options plays.  And mostly I was holding to that.  $1,000 a week.  Maybe $5,000 a week.  Lot risk stuff.

 

I had Carvana which I had sold a call for at $405 a couple weeks back.  300 calls, 30,000 shares.  Probably 50 cents each at $405.  Back when the stock weas maybe $330.  Thing went on a heater.  For like 2 weeks.  EVERY SINGLE DAY.  I even had counted on Thanksgiving giving me a free day and the day after similar.  Man it made up for lost time.  In less than 2 weeks, from just before turkey day to yesterday is went up about $70   Far beyond my budget of $5 a day easy money etc.  The children of Reddit were just killing it.  Can’t believe they didn’t run out of money.  The stock and company are crap.

 

Sooooooo last night.  I happened to notice.  It had gotten up to about $400 and fell back to $398.  my call was $405.  My options were worth a negative $120,000 or something.    But I looked and say that I could sell more calls at $4 each.  Hmmmm, one day?  Like ONE day.  So think about this.  It’s at $398 and will probably go down after all this run up.  Further, what if it DOES go up?  Fine, go from $398 to $404.99  That is still almost $7 in day.

 

AND if I sell calls for $4, then basically it can go up to $409 on the day and I would still break even.  If it went up LESS than $7?  I win.  100 calls would be 10,000 shares.  $40,000 for one day of stress?  Why not?  Besides, a habit I have noticed with calls on this stock is this.

 

They tend to run up overnight just before the expiration date.  Max out in the first couple hours, then tend to melt away as the expiration date approaches.  Meaning, the stock price tends to run up and then fade nearer closing on Fridays.

 

So I figured if I did it and it was still under $405 by 10-11 am, I would be ok.    And just like Clockwork, that’s what happened.  went up to $401.  Sunk back down to $399 and about stayed there.

 

That was fun.  And profitable.  Wonder if I could buy a linebacker with $40K. Probably not.

 

Looks like the stock shot up $40 after hours.    Not sure what that’s all about.

 

 

 

 

[BigBalls]

Carvana popped on the news that they will be included in S&P 500 index. It popped big. Car sales are strong too. You took a nice shot there Java.The volatility in this stock is similar to TSLA. It can make you rich or poor. Good job on identifying this stock.

[Author]

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