covered call profit and loss question

[spindr0]

If money isn't credited to my account when I sell something, how come they take money out when I buy something ??? .


Whenever you sell something, the proceed are credited to your account. Doesn't matter whether it's an option or a stock, etc. Conversely, whenever you buy something, the proceeds are deducted from your account. Transactions result in a change in your cash balance.

Margin and SMA balance may be affected.

Account value is not affected unless the value of the underlying changes

 

[atticus]

Quote from Took2Summit:

1a2b3c:

All I can do is offer my answer based on my own experience.

When I sell a call with my brokerage firm, my account value stays the same, I do not get any more purchasing power or leverage power, and no cash is put into my account. I have to earn the premium during the life of the option.

As I said earlier, If someone knows of a brokerage firm that operates differently then I just stated, please let me know as I will consider changing firms

Your point regarding your 20% gain requires us to believe that you took the fictional $20,000 to $23,793 on page 1, post 1 of your journal. Beyond that leap of faith is the problem that you ended the journal at $22,110.

So you don't understand how a credit balance is generated nor that a loss is not a profit.

 

[Took2Summit]

Quote from atticus:

Your point regarding your 20% gain requires us to believe that you took the fictional $20,000 to $23,793 on page 1, post 1 of your journal. Beyond that leap of faith is the problem that you ended the journal at $22,110.

So you don't understand how a credit balance is generated nor that a loss is not a profit.

First of all, the journal isn't ended. Second of all, if you look at my most recent update, and look at the picture attached, you will see the most recent value was 23,286..not 22,110 for someone so caught up in semantics I would have at least assumed you got this right, but I was wrong as I can be from time to time.

Third of all, the market has jumped 330 points since my last update and my live value as of right now is 23,925. I can understand you think the 20,000 is fictional, that's fine.

So my last statement remains, which is also prevelant in the picture I am referring to in my last update. In 13 weeks I am beating my benchmark by 11%.

 

[atticus]

Quote from Took2Summit:

First of all, the journal isn't ended. Second of all, if you look at my most recent update, and look at the picture attached, you will see the most recent value was 23,286..not 22,110 for someone so caught up in semantics I would have at least assumed you got this right, but I was wrong as I can be from time to time.

Second of all, the market has jumped 330 points since my last update and my live value as of right now is 23,925. I can understand you think the 20,000 is fictional, that's fine.

So my last statement remains, which is also prevelant in the picture I am referring to in my last update. In 13 weeks I am beating my benchmark by 11%.

Numbnuts, you started the journal at a fictional $23,793. There is no proof of any of this, but you certainly can't keep your BS straight as the first journal entry showed $23,793

Quote from Took2Summit:

Hello,

I have a portion of my portfolio I would like to track in this journal. This is a somewhat new method for me and I have been trading the method with real dollars for about 3 months now. I will use all real dollar values as a fraction of my actual holdings. I intend to update at least weekly, but hopefully more often if I feel there is something worth posting.

Strategy:
My main strategy for this journal is going to be holding strong, established companies, with dividends ideally but not required. I will be selling monthly calls on all my holdings and will be swing trading the calls, while holding the investments themselves long-term.

I will not update the value of each holding, instead I will update the calls sold and total portfolio value.

Everytime I close/open a call position I will update here.

Current Portfolio: $23,793 (I started this portion of my portfolio with $20,000)
MSFT Aug 20 $27
M Aug 20 $30
NKE Aug 20 $92.50

So WTF is the 20% gain from the start of this journal? Your own BS puts you in a loss. Further, there is no $22,110 in your excel snapshot.

 

[Took2Summit]

Quote from Took2Summit:

Don't worry atticus, I cant share that trade with you. I have, however, been sharing my other portfolio with real time trades which is up 20% YTD, you can use that one all you want.

I actually said YTD, not start of journal.

And I see you didn't comment on any of my other comments, such as my last update was 23,286 not the 22,110 you grabbed out of thin air.

 

[atticus]

Quote from Took2Summit:

I found this site just a couple months ago, about a week before I started my journal. As I stated in my journal I started the portfolio with the equivalent of 20k (20k is a representation of my actual dollar value in the portolio, which is significantly higher).

If you can't take my word that I started the portfolio with 20k, then that's totally fine man. However I have beaten the SPY by 11% in just the 13 weeks I've been tracking the portfolio. I guess I can't have a REAL YTD return until next year since you can't believe me, and I sure as hell am not about to show you my statements.

So for you, my friend, I am ahead of my benchmark index by 11% in 13 weeks.

Quote from Took2Summit:

Start of week: $22,128
End of week: $22,110 (-0.08%)

I am done updating real time trades, I don't think anyone cares anyways.

I will say this, I lost about .30 on a decent amount of contracts this week due to clicking submit trade and being rushed away from the computer and coming back a couple hours later to find I didn't click confirm trade. This was yesterday when the market reversed. I ended up making the trade towards the market bottom yesterday.

Of course the $22,110 is nowhere to be found in the spreadsheet. More bullshit, different thread.

 

[Took2Summit]

As I said, I can understand your problem with believing that I started the portfolio with 20,000 as I believe you think everyone is lieing. The only fact I can prove to you is that I am beating my benchmark by 11% in 13 weeks. So instead of saying I have a 20% gain YTD (which I do) I will say I am beating my benchmark by 11% in 13 weeks, and we can revisit this performance issue you are having several months down the road when my real time trades give you enough confidence to trust my results.

 

[Took2Summit]

Quote from atticus:

Yes, I STARTED the portfolio, not STARTED my journal. Two different unrelated events.

 

[Took2Summit]

Quote from atticus:

Of course the $22,110 is nowhere to be found in the spreadsheet. More bullshit, different thread.

I didn't say it's no where to be found, I said you grabbed it out of thin air claiming it was my most recent statement, as you said I ENDED my journal with that value, when actually there is a more recent value of $23,286

 

[atticus]

Quote from Took2Summit:

As I said, I can understand your problem with believing that I started the portfolio with 20,000 as I believe you think everyone is lieing. The only fact I can prove to you is that I am beating my benchmark by 11% in 13 weeks. So instead of saying I have a 20% gain YTD (which I do) I will say I am beating my benchmark by 11% in 13 weeks, and we can revisit this performance issue you are having several months down the road when my real time trades give you enough confidence to trust my results.

You're tripping over your own bullshit. Start of the journal was nearly $24k, but you show a $22k balance on the last page. Then you produce a spreadsheet but the prior week's $22k isn't shown in the sheet.