Friday, April 3, 2015

Recent Sale - Trade Closing

I recently wrote about a trade in which I purchased 2 contracts of TD in Canada at $54 strike price.  I paid a premium of $0.85 per contract with a May 18, 2015 expiration date.

On Friday, the stock showed a little strength and this was enough to push the value of the option upwards. My limit order (Sell to Close) was filled at $1.25 per contract.

Summary:

Initial Investment : 2 contracts *$0.85/contract*100 shares +$11.95
                              = $181.95

Proceeds of Sale = 2*1.25*100-$11.95
                            = $238.05

ROI = Profit/Initial Investment
        = ($238.05-$181.95)/$181.95
        =  30.83%

Click to Enlarge

This trade was in my TFSA, so I pay no taxes ever on this profit.

DISCLAIMER:
I am not a financial planner, financial advisor, accountant or tax attorney. The information on this blog represents my own thoughts and opinions and should NOT be taken as investment or business advice.

Every individual should do their due diligence to make their own financial decisions based on their financial situation and tolerance for risk.
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2 comments:

  1. Roadmap2RetireApril 3, 2015 at 12:14 PM

    Nicely done, IP. Ive stayed away from options trading as Ive been burned in the past. From time to time I dabble into writing covered calls in companies that I dont mind selling.
    Do you have any recommended resources to learn more about options trading?

    R2R

    ReplyDelete
    Replies
    1. Investing PursuitsApril 3, 2015 at 5:14 PM

      R2R,

      Thanks for dropping by. I good resource is www.tastytrade.com. I believe you would have to register on the site (its free) to get most of the stuff. Tom Sosnoff was co-creator of Think or Swim platfom. Lots of videos and stuff on the website. I quite sure you can learn about any option strategy on the website. It is just a matter of taking time to explore the website.

      Delete

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