Bought to open NUGT covered call (6/17 expiration, $102 strike)


Bought to open 200 shares of NUGT at $100.614, and sold to open 2 call contracts with $102 strike price, expiring 6/17, at $4.10. Total cost including commission is $19,320.20, or $96.601/share.


NUGT closed today at $100.74, almost unchanged from where I had bought the shares. The overall position will be profitable at expiration (tomorrow after the close), if NUGT stays above $96.60. The maximum profit for the position ($1,061.68) will be achieved, if NUGT closes at $102 or higher. The probability of loss is about 40%. The likelihood of the position achieving its max profit potential is 41%.

Unless the NUGT shares get called away from me tomorrow, I will need to decide, whether to remain long NUGT. This will depend mostly on my assessment of the likelihood that leave” will carry the British election on EU membership. If remain” is likely to win, then there’s a much greater chance that global central banks move off their current ZIRP/NIRP stances and for economic growth to continue strongly. I would see that as negative for gold and NUGT.

June 16, 2016 at 3:22pm · NUGT · buy to open · covered call

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