Nvda selling calls earning 55 usd in a nite with every day taking extra premiums/dividend $16 theta decayJoin me on Tiger Trade!

Blinkfans
06-09

If I am selling (shorting) this call option, then the theta works in my favor.

From the screenshot:

* Theta = -0.157

* Option price = $9.40

* Contract size = 100 shares

As the seller

The option loses about:

0.157 \times 100 = \$15.70

of value per day, all else being equal.

So if:

* NVDA stays at the same price,

* Implied volatility stays the same,

* Time passes by 1 day,

then the option may drop by about $0.157 ($15.70 per contract), which is a profit for me as the seller.

Example

Suppose I sold the call at $9.40.

Option Price My Profit

$9.40 $0

$8.40 +$100

$7.40 +$200

$5.40 +$400

$0 +$940 (maximum profit)

Risks

My risk comes from:

1. NVDA rising sharply (Delta = 0.513 is fairly high).

2. Implied volatility increasing (Vega = 0.250).

3. Being naked short rather than covered.

Breakeven at expiry

I collected about $9.40 premium.

Strike = $210

Breakeven:

210 + 9.40 = 219.40

If NVDA is:

* Below $219.40 at expiry → I make a profit.

* Above $219.40 at expiry → I start losing money.

If I am selling a covered call (I own 100 NVDA shares), the position is much safer than if I am selling a naked call.

Find out more here: Join me on Tiger Trade!

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Nvidia CEO Jensen Huang Highlights Share Volatility as a Buying Opportunity
Nvidia CEO Jensen Huang commented on the recent share price volatility, describing it as a buying opportunity for investors. This statement reflects confidence in the company's future prospects despite market fluctuations.
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