Here at OptionsBrew.com, we believe a trading plan is already a 50% key to success. Without further ado, here is our trade plan for the upcoming month of June 2020.
We are looking to buy 9 shares of PFE for our Partnership fund. At the end of the month we should have 24 PFE stocks - once we will have 100 shares of PFE we will start selling covered calls on it, see: Covered Call Trade Idea with Weekly Options - Generate $45/week from this Dow Jones list Dividend Stock.
Currently, we have 11 open trades expiring in the month of June, all but one looks good.
There might be a problem with June 19 expiry date put option on RDSA, as we already hold 100 shares of RDSA, this is something we would like to avoid - to take more RDSA shares. As we are trading on margin, this affects our buying power.
If our current 100 shares of RDSA won't get called away until June 19, we will buy back our put option on RDSA, this will trigger the so-called - penalty trade
Penalty trade - anytime we close an options contract with a loss, as a penalty for our mismanagement, we buy additional dividend stock to - right now there are two companies we are buying - BAC and T.
Once there will be at least 100 shares we will start selling covered calls on them, see: Covered Call Trade Idea - Generate $100/mo from this Stock
If penalty trade will be triggered, we will buy at least 12 BAC stocks in month of June.
As we are trading on Margin, we currently hold a negative cash balance of -EUR 5,594. We are looking to end the month with -EUR 3,000.. There are two covered calls we are holding and looking to get called away - RDSA and GPS, after them called away we should get back EUR 1500 and $950. Additional dividend income + options income should help minimize our negative cash balance.
From covered calls/puts - looking to take ~ $600 during the month of June.
Half of the options income will be spent on additional PBCT dividend stock buy, while other half will be witdrawn.