Options Expiration – June 2019

I usually have more planned for June expiration, but was able to spread out the few option positions I have this summer. The only June contract I had in place today was on MDY and it was in the money slightly, but still gave me a profit. MDY was trading at $355.75 when I sold the $355 strike. While MDY was trading at $350.86, down from its intraday high of $353.20, I bought to close my one MDY June $355 naked put for $4.14 and sold one MDY September $350 naked put for $9.69. I received $554.39 after paying $0.61 in commission for the combination.

I toyed around with my asking price for this option spread until I got this one to hit. I could’ve done better before MDY began its afternoon slide, but still did fine. I paid no time value for the June contract and sold on the high end for the September bid/ask. The bid/ask was $9.50/9.80 when the order hit, so it was good to be closer to the $9.80 side of the spread than the $9.50 side.

While I missed out on timing this trade perfectly, I’m very happy I made a profit while the underlying ETF lost value. I’ve said it over and over here, selling options is a great way to reduce risk. I earned a realized gain of $285.45 on this June contract while MDY fell $4.89. That’s just cool. Also cool, I lowered my strike $5 and added $554.39 to my cash reserves at the same time.

I didn’t get a notice, but I see my XLF June $27 covered calls must have been assigned last night. I don’t know why Interactive Brokers isn’t showing it. They show my client’s FEZ assignment, so the system isn’t completely broken. I double checked my trade history and holdings through yesterday and it still showed in my account. At least I track my own holdings, so I know. I earned a whopping $6.90 on my position through the series of trades when I include my original naked put and the XLF June $27 covered calls that were assigned.