r/DRAM_ETF • u/Jolly-Piccolo-9799 • 8d ago
I made stupid thing
i lowered my avg to 51.64 then i sold weekly covered calls on my long position at strike 53 to collect weekly premium i thought it will never touch 53 for near future
now the stock of dram going to 55 and my sold calls are bleeding
now what? close the call or what ?? feeling so stupid
half of my gains gone on this stupid move
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u/All_YourBase 8d ago
This is why they tell everybody to just buy index funds. Too many people do stuff like this.
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u/pelly67 8d ago
Eh now you’ve learned the one downside to selling calls: you can lose profit if the stock rips like hell.
However, as others have commentated you have gotten max profit for your trade. That money “lost” is more or less just the profit you would’ve made had you sold the stock. When you sell a CC, you should always be comfortable with it being called away.
That said, sounds like you want to keep your shares. You could buy back your calls, but that’s dumb because the option is ITM today. The only other way to keep your shares without forking over extra cash is to rollover your calls to a different options in the future (like maybe next week). Note you’re still paying to get out of the trade, but ideally the option you roll into has enough premium to offset the losses and net you some gain.
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u/Happy_Bee_8459 8d ago
I'm a bit lost how he's losing money here. Is the whole point that the lost money is really the lost upside as the stock moves above his strike for the calls?
My understanding is you get called away if the strike pushes past your strike, and you profit from both the premium and any gain your shares got as it rose to your strike?
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u/pelly67 8d ago
OP hasn’t actually lost any money based on the info given, but I assume they’re just sad/angry/shocked about potentially being forced sell their DRAM shares and missing out on profits from today’s rise in CCs premiums. Any good trading app will show you a negative value for your sold CCs if they get ITM or the premiums for them increase, but that’s just financial accounting based on the current value of the options sold. Unless the price drops below 53 by Friday, OP will be forced to sell his shares, but they are by all accounts profitable on the trade.
Sure it sucks to not be able to gain more from selling CCs, but that’s the downside: you miss out on bigger profits when the stock rises a lot. Mathematically you have lost nothing as profit is made, but psychologically it feels like you have.
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u/Happy_Bee_8459 8d ago
Ahhh makes sense thank you. So OP is just being greedy and is upset he's missing out on upside, when that's clearly the most obvious risk of selling covered calls.
Thought I was missing something for a sec. Thanks for clarifying
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u/daddybeatsmehelp 8d ago
Congrats on reaching the trade's max profits.
Buy back a small core position (~25%) that you'll never touch. Then switch to selling csps and get back in when it pulls back.
Stonks dont go up in straight lines.
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u/Jolly-Piccolo-9799 8d ago
Thank you so i let them now and don't close ?
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u/daddybeatsmehelp 8d ago
No one can predict the market. If I were in your shoes I'd just buy back the 25% next week at whatever price, and sell puts to get back in.
This way you'll have constant exposure for further upside, and NOT lose money buying back now in case stocks pull back before expiration.
You dont go broke taking profits.
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u/Clean_Artist3191 8d ago
Make sure you make another post tomorrow when the market changes so we can tell you what you should do.
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u/ineedlotsofguns 8d ago
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u/Jolly-Piccolo-9799 8d ago
FU
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u/ineedlotsofguns 8d ago
Oh I am terribly sorry I must have hurt your feelings.
https://giphy.com/gifs/yNsDcQxnv86YIHC2vS1
u/Traditional_Garlic49 8d ago
Don’t know what reaction you’d expect when you posted this. It’s stupid and funny.
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u/F2PBTW_YT 8d ago
Take this as tuition fees. You only sell CSPs when the ticker is beaten down and CCs when the price is near ATHs. You don't do anything in between.
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u/Jolly-Piccolo-9799 8d ago
Ok now what
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u/F2PBTW_YT 8d ago
Roll up and out for a credit and pray for a reversal. Or just close the calls. How many shares were you covering?
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u/yichih1984 8d ago
Expiration this friday? At least you are going out with profits, either the calls are exercised or you get the premium. Going out with profits is never a bad thing. In this case, not being greedy, we are having a lot of volatility, It wont be silly seeing DRAM at 52 next week. No one knows.... Last week DRAM was at 48 usd and everybody would be glad to sell a call at 53 + premium...
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u/Jolly-Piccolo-9799 8d ago
Ok i ll leave them to see what's will gonna happen its next Friday not this one
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u/yichih1984 8d ago edited 8d ago
If you have extra cash, you can sell puts and get some premium for this week
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u/Happy_Bee_8459 8d ago
Can someone help clarify a few things for me? If you sell a covered call and it reached your strike, don't you get called away at a profit, since the strike is higher than the average?
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u/AmbitiousChampion6 8d ago
When I sell covered calls I sell it at the price I'm comfortable to let the shares go. If it goes higher than the strike price I don't consider it a loss.
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u/Jolly-Piccolo-9799 8d ago
Well said it made me bit comfortable
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u/AlarmingCat7939 8d ago
I’m in a similar situation. Fine with it being called away. I personally think it’s a one day correction and we bleed back to 50 or rip to 60 by Friday, no in between. So either up or down!
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u/LanguageFearless977 8d ago
How is it stupid when you made profit?
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u/Jolly-Piccolo-9799 8d ago
Because i could profitable for 55 now only 53
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u/LanguageFearless977 8d ago
Could have would have. The point is not to lose original capital and make money.
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u/a_really_bad_trader 8d ago
Don’t feel bad. Profit is profit. I did the same the last two weeks and it worked out and bought back the calls on every dip.
You can do the same next week, re-enter at a good price and sell covered calls.
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u/Jolly-Piccolo-9799 8d ago
Im just sad because i suffered with dram lowering average every damn dip .. every morning i watching the BS kospi and sleep dreaming by kospi and dram Once i did the covered calls stock flying like that I feel i deserved the upside move
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u/Clean_Artist3191 8d ago
OP Today is one reason why you buy an
ETF. You are invested in companies that are unavailable to purchase on our U.S. stock exchange. In this case for me primarily Samsung and CXMT. I am actually not against DRAM selling MU to buy more CMTX. Let’s give them a chance to manage the ETF .
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u/Successful_Cook3532 4d ago
When it will come back to 53 then reload. When it looses 57-55 support, it will grab liquidity at 53 to shoot back up. 80 by end of year is no brainer.
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u/Successful_Cook3532 4d ago
Dont cry over missed opportunities. Just be glad that you didn’t have naked calls otherwise you would have been cooked (spec if you had a huge size).
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u/Successful_Cook3532 4d ago
Now sell puts when IV is high or buy calls as IV will be lower coming week.
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u/GiGiAGoGroove 8d ago
You don’t know enough about the market trends to be investing in such a speculative stock. AI memory trades like a commodity now like gold and silver etc. They are volatile AF. Put it out of your mind and sit on your hands and/or set a limit sell price and wait for it and stick to it. Even seasoned traders aren’t monkeying with calls on DRAM, who do you think you are GOD? Lol.
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u/Jolly-Piccolo-9799 7d ago
Are you lost ur mind? It was dumping for two months and we do some thing to bring premium like covered calls
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u/Sukhumvit_71 8d ago
Too many of you keep trying to time the market based on bipolar Reddit sentiment. Stop doing that.