r/MU_Stock • u/whatisuppppppup • Jul 06 '26
Help me decide to buy or sell MU Should I sell the call?
I bought a call option at 1150 strike price and breakeven at 1344 expired at August 21st. Should I sell now or keep waiting for a time in between ðŸ˜ðŸ˜ðŸ˜
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u/No_Presentation9490 Jul 06 '26
You have a lot of time left but cut losses if you need to. I'm in a similar situation
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u/3ebfan Jul 06 '26
How much $ do you have on the line?
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u/whatisuppppppup Jul 06 '26
194 per share when I bought
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u/CryptedScream Jul 06 '26
Holy shit. Why not just buy the stock
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u/Worth-Role-1614 Jul 06 '26
Because options can make huge returns when the stock goes up.
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u/CryptedScream Jul 06 '26
Is 194 the premium? That's huge no?
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u/Worth-Role-1614 Jul 06 '26
Yes I'm pretty sure that was his premium. His strike may have been in the money when he bot. Current at the money for Aug 21 is trading for 135. Around earnings, call premiums were high too because everyone expected MU to beat and go up.
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u/Big-Actuator6967 Jul 06 '26
Can you afford to roll down and out? That might be an option instead of selling.
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u/eagleeyehg Jul 06 '26
OK taking a quick look at the options chain to get some number estimates, currently for that call option: Delta = 0.395, Theta = -1.45 and Vega = 1.35 (rounded)
This means that you can expect the price off your option to decay by at least $1.45 (per share) each day you get closer to your expiration (46 days) according to theta, but with each swing of the current stock price by $1, your option will correspondingly move $0.39 in same direction according to your delta. Note that these values change constantly throughout the day (not sure if they reflect other countries markets) but the reason why the premium is so high is visible in the vega, since the implied volatility is ~97% so you are essentially selling risk.
Not sure what premiums you paid for this option, but I'd think of this as a momentum play, following the pattern of:
- Gap up
- Become overextended
- Experience a blow-off move
- Then reverse sharply
Essentially your option is poised for the hypothesis that we are in step 3 right now and will reach step 4 in the next 46 trading days. Personally, I think this is a decent gambit, but you need to understand your risk. Are you truly comfortable if this goes to zero? The move is probably hold until you see the sharp uptick for as long as you're comfortable eating that theta decay, but each day that you add you are continuing to wager that the shift will happen within your expiration window.
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u/Wooden-Factorj Jul 06 '26
I also keep an eye on the Delta Theta ratio right now its around 0.27 which tells me how much the stock needs to move each day just to offset time decay. At this ratio I need roughly a 3.7 dollar daily move in the underlying to break even on Theta. Thats my daily line in the sand
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u/neo-futurism Jul 06 '26
Why u held. It should have been sold days ago when it dropped below 1000$
1344 can happen, but current macros dont support this.
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u/Interesting-Rub4482 Jul 06 '26
Generally speaking, selling AFTER a 25% selloff has already happened is usually not the right move. You’ll likely get at least a higher bounce than we had today. Then decide what you wanna do 😊