With the market already experiencing jitters before the Federal Reserves meeting taking place on 14 and 15 December, where investors await further announcement on tapering and interest hike plans, the announcement of the first death with the Omicron variant adds more fears and uncertainties to the market.
Tesla dropped 5% in share price to below $1000 and I saw a good opportunity to add on to another Tesla LEAPS. However, I was low in capital and the Tesla LEAPS that I own (expiring on Jan 24) costs more than USD10,000 each. Therefore, I looked at the LEAPS options contract that expires earlier (Jan 23) and bought a Tesla LEAPS with the highest strike price (deep OTM at $2475). I paid a premium of $4,050, the delta was 0.152 and the share price of Tesla was trading at $966.
Raising Funds
To fund this purchase, I sold an APPLE LEAPS (SP: $185, Expiration Date: 15 Sept 23) which I bought on 10 Sept when Apple was trading at $155. The premium that I paid was $1,540 and I sold it for $2,720 yesterday and made a profit of $1,180, which translated to a 76.62% gain in just over 3 months.
On My Radar Now
I woke up this morning and saw that Nivida has closed at an attractive share price of $281.61 on yesterday’s (13 Dec 21) session. It has dropped way below its all-time high of $346.
Nvidia is one of my high convictions stocks and I think they will continue to do well in the months and years ahead and will play a critical role in building the metaverse. Other than producing computer chips for gaming, crypto mining, AI, autonomous vehicles, Nvidia’s software platform, Omniverse, is already training robots in a virtual world built to simulate the real world so that these robots can be ready to carry out their mission in the real world after their training. I will stand by the capital I freed up in my final round of cutting loss on 9 Dec to buy more Nvidia LEAPS if the share price continues to fall this week.
Concluding Thoughts
Despite the market going down in December, I have made more than USD50,000 in the last 2 weeks. This is because I am cashing in on my LEAPS that I bought a few months ago when the price was reasonable and the market going through a correction. It is in times like this where you pluck the courage to sow the seeds of your future success.
I hope this sharing has been useful to you and do subscribe to this blog to get first-hand notification via email and content delivered right to your mailbox whenever I made a new post. Thank you all for supporting this blog and leaving your encouraging words. Wish you all the best in your investing/ trading journey.
Related Articles:
I Cut $135,715 Worth Of Losses In The Last 1.5 Months
Why I Bought AMD & Nvidia LEAPS At All-Time High?
[7 Dec Trades] AMD PUT, AMD LEAPS + Nvidia LEAPS
[6 Dec Trades] Added 3 More LEAPS (AMD, Nvidia & Alphabet)
My Guiding Principles Of Buying LEAPS
The Risks Of LEAPS Options Trading & How I Mitigate Them
Learning Investment With Jason Cai 