[Options] March Expiration Open Positions Review

Sean McLaughlin
March 2, 2020

As March gets under way, it’s time to review positions with March options that remain open (haven’t already hit profit targets or been stopped out).

Wild couple of weeks, but that doesn't mean we deviate from our plans!

Most trades I put on for All Star Options tend to have a minimum duration of 30 days (short premium plays) and often as long as 6-8 months (for long premium plays). As options approach expiration, greeks like theta and gamma start to become my enemy and whipsaw my P/L. Therefore, as options and spreads get into the expiration month, my best practice is to put each position on notice — it’s time to take action.

March positions closed at profit target: $LMT (1/13),  $V (1/13), $SPY (2/20), $XRT (2/18), $MELI (2/28)

March positions closed at a loss: $TWTR (10/25), $JD (11/21), $DIS (1/24)

Remaining Open Positions (in order of entry):

  • $KSU Long $150 Calls: we entered this position back in September. We sold half of our position on 10/18 at a double and held the rest. At the time of this writing, these remaining calls are now trading out-of-the-money, so we're looking to close them here. Currently, these calls are trading around $6.00 per contract. Whatever we sell these calls for represents our entire profits for the trade. Win.
  • $MSFT long $140 straddle: Wild ride on this one. We've given back a significant amount of profits on this open position, but it still remains in the win column. The level we'll be watching from here is $158. If $MSFT closes below 158, we'll exit this trade and book our win. If this bottom holds, then we'll keep holding as long as we can into expiration, being mindful of any newer, higher, support levels that develop that might clue us to exit and take our profits.
  • $EEM long $45 calls: We entered this trade on October 25. Fortunately, we were able to take our original risk capital off the table when we sold half of our position on 11/7. $EEM topped out in January and has been sliding since. Our calls are now out-of-the-money and we can still get 5 cents for them. Closing here for basically a scratch (tiny win).
  • $XLF Long $32 calls: nothing to do here. Calls are out of the money and zero bid in the calls. Lotto tickets for remainder of the month.

Send me any additional questions here.

~ @chicagosean

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