Sunday, May 22, 2016

Option Expiration Day - May 20, 2016

    For the most part, options expire on the 3rd Friday of the month.  For the month of May, this 3rd Friday of the month occurred on May 20.  I recently wrote about some option trades that I made which involved covered calls and a naked put.
    Two of these options were set to expire on May 20, involving TD Bank and Telus Corporation.  TD  Bank closed higher than $56.00, which is the strike price.  Therefore, my shares of TD Bank were called away.  What is my plan going forward.  I am looking to purchase this stock at a lower price then my previous adjusted cost basis of around $55.30 per share.  I might sell a put option to collect income while I wait for the price to go down.

Covered Call on TD at $56 Strike Price

      I previously sold a put option for Telus Corporation with a $40 strike price.  I sold the put option when the price was below $40, which resulted in a higher premium.  The option was not assigned prior to expiration.  On May 20, the price of the stock remained above $40.00 so the option expired worthless.  I get to keep the premium as I was the option seller. 

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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