Sell near 0DTE google option earn 1% around per month
Picture this: Google, one of the tech giants, is currently trading at $130 per share. The game plan here is to sell a weekly option with a strike price of $120, set to expire in 14 days, at a premium of $0.36 per contract. But how do we gauge the potential gain or loss here? Let's break it down.
First, understand that one option contract typically represents 100 shares of the underlying stock. So, in this case, your contract involves 100 shares of Google. You'll receive a premium of $0.36 per share, which totals $36 ($0.36 x 100 shares) for selling one contract.
Scenario 1: Google's price remains above the $120 strike price at expiration. In this case, the option expires worthless, and you keep the entire $36 premium. The percentage gain here is simply the premium received ($36) divided by the initial capital at risk (which is essentially $120 for the strike price), resulting in a percentage gain of 30%.
Scenario 2: Google's price falls below the $120 strike price at expiration. You might be obligated to buy 100 shares of Google at $120 each. However, since you already received a premium of $36, your effective purchase price is reduced to $120 - $36 = $84 per share. If Google is trading at, say, $80, you'd still have a paper loss, but it's cushioned by the premium you received.
In essence, you're looking at a potential gain of 30% if Google stays above $120, and if it drops below, your effective entry price is lowered thanks to the premium.@MillionaireTiger @TigerStars @Daily_Discussion @MillionaireTiger do feature my nice strategy with $10 plus buffer
Comments
Guess what time it is . It’s time to vote and change the CEO and upper management so google can come back $150.00
well.. Sold 142 Nov 3rd calls.. Please take my shares at that level.. got 2.15 a contract.. good luck .. Amazon pays even more.. higher beta..
Are you the one who also sold covered call for Manulife? 😂
same for all tech stocks, google is not doing too bad tbh
Gov will terminate G is burned asset.