While, according to the trades shown above a $4 profit was made but a LOSS on the stock amounted to $19....or maybe it's a rich uncles game and $4,000 profit was made on the calls....but that would mean that $19,000 was LOST on the principal...pardon me, but how is this a win? Or are you selling calls on stock you dont own?..
Unfortunately, this is exactly right. In my own case last week I booked a profit of $780 on options plays while my net worth went down $28,000. The only way a positive spin can be placed on this is if one assumes I had no intention of selling the stock in order to avoid the $28,000 loss I did not know was coming. In that case, I was going to experience the loss regardless. The $780, while small consolation, is better than the $0 I would have received without the options. Of course, if my crystal ball was working up to spec last Friday (or better yet, Feb 2000) I would have sold everything that went down this week, held on to those few that went up, and avoided the options altogether.
Alas and Alack, as they say.
ARS |
