Palantir has been on an absolute rocketship since it reported Q2 earnings on 5th August, the fateful day of the US market flash crash due to the rapid unloading of Japanese Yen carry trade.
Had I not sold my 1000 shares at USD21 that day to save my portfolio liquidity, I would be USD81k richer now. Hindsight vision is always 20/20.
When Palantir’s share price started to rise rapidly, I was hit by another setback as my unrealised losses in my failed Palantir Covered CALL positions started to balloon. I had previously sold Covered CALL on Palantir at a strike price of USD8 when it was bottoming below USD10 in 2023.
It was then when I realised that I need to hedge against this upcoming huge loss by building up more bullish positions on Palantir. I shared in this article back in Nov 2024 on how I repaired my broken trade by buying Palantir CALL options and shares. Palantir was trading around USD50 at that time.
Fixing My Broken Palantir Trade (SELL CALL) | How To Fix A Broken Short CALL Contract?
I continued buying more shares and CALL options as there was much hype of Palantir being the most dominant AI software company and started to take profits when the stocks experienced a pullback. The below are all the profitable trades that I have made over the past 3 months
[14 Nov 24] +USD339, Took Profits on Palantir CALL Options
When the market became volatile after FOMC meeting in Dec 2024, I started taking profit by closing the CALL options trades.
[9 Dec 24] +USD4.6k Profits, Sold Palantir CALL Options (46% Profits)
[19 Dec 24] +USD2.32k Profits, Sold Palantir LEAPS CALL (112% Profits)
[20 Dec 24] +USD2.7k Profits, Sold Palantir LEAPS CALL (131% Profits)
At thus juncture, I started buying up a new LEAPS CALL position with a longer expiration date (15 Jan 27) with SP USD115 as I feel that Palantir is able to reach this strike price 2 years later.
[27 Dec 24] +USD2.68k Profits, Sold 1 x PLTR LEAPS CALL (130% Profits)
I took my 130% profits and closed my position as Santa Claus rally did not come in end December.
[2 Jan 25] +USD6.3k Profits, Sold my Palantir Shares
I then sold my 600 shares of Palantir at various prices before the stock dropped to about USD65 in Jan 25.
[3 Feb 25] +USD1.7k Profits, Sold 1/2 of my Palantir LEAPS CALL
[4 Feb 25] +USD9.9k Profits (89% Return), Sold Palantir LEAPS CALL (89% Profits)
I sold my remaining LEAPS CALL positions one day before and on earnings day itself.
Concluding Thoughts
I am thankful for the returns I got out of the Palantir trades and I believe these trades play a big role in helping me break even on the huge losses I incurred in options trading. My approach was to take profits on the positions that were profitable if the market was correcting, and find opportunities to average down on the not-yet-profitable positions when the market is down. This has helped me accumulated enough positions to create an impact when I sold them off. However, do manage your risk accordingly as there is a chance to that the options contracts, unlike shares, could go to zero if the stock start to plunge.
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