How to adjust a covered call in neg? Closing call or stk for profit and rebuy or sell the strike does not work
Do you mean you are losing money on the trade and want to know what to do next? If that is true and you no longer wish to lose more money on the trade, exit it and move on. If you take a fresh look at the trade and like it more or as much as before, and don't want to exit the trade because you believe it will still be profitable, then leave it on. You should never keep a trade just because you are losing money.
I assume the stock has appreciated enough so that the short call is higher in price than when you sold it, if so: I would hang on until expiry. If the stock is called away you might have to reconsider covered calls. If the stock plunges you might have to reconsider covered calls. Covered calls cap the upside and provided no protection to the downside. Is the premium collected worth the risk?
The premium may not worth the risk But the trade is now neg at exp wonder if there are ways to even the trade
Has the stock gone down? You "might" have to close the trade to prevent additional loss. Has the stock gone up? You "could" wait till expiry and let it play out. Decisions,decisions, decisions. Welcome to option trading. You can't "adjust' losing positions into winners or break-even without taking on additional risk.
If you really want a specific answer, you'll have to provide specific information. Why not just give the stock, the shares you own, the calls you sold, the expiries and premiums, and let people take a detailed look at it. You'll also have to include your long term goals for the trade when you opened it. Most of the time when covered calls are sold, there isn't much that can go wrong. You sometimes have to decide whether you want to take a loss to hold your shares, or whether you're ok losing the shares, but it's hardly "lost money" More details pls.
Sell msft 45 call 1.68 and brought msft at 49 The position is neg at exp Did close the call for some profit with msft decrease in price