Pocketing AbbVie Premium - February 12th Option Expiration Results
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The results are in!
Continuing along with our AbbVie (ABBV) options positions, we have now pocketed that small premium that we collected from the covered call. We still own the shares and will revisit next week if any moves are made.
(Source)
As a brief refresher, this covered call was written at a strike price of $111. ABBV closed Friday below this amount at $104.44 (after hours looks like $104.60.) Well away from our strike price, as we would had anticipated.
(Source - Google Finance)
We collected the full $0.28 or $28 per contract. This was after previously writing puts to enter into the position into the first place. At that time, we collected $1.18 or $118 per contract. We were assigned the shares at the $110 strike price as the price of ABBV closed below that price on the expiration day.
However, collecting that $1.18 and $0.28 will have our “cost basis” down to $108.54. Still, as we can see where shares are trading we have losses on paper. Still own the shares and looking forward to continuing doing so until these shares get called away.
What Now?
(Source)
The next move would be to revisit next week once the market opens after the long weekend. The market continues to melt up, but ABBV has been struggling to find a direction as of late. This could be a great thing as we can possibly continue to write covered calls around the $110-ish strike price area. I’m perfectly content with continuing to hold ABBV for its strong future prospects and strong dividend. So there is no rush to start writing calls at anything below our “original cost basis.”
(Source - Seeking Alpha)
Additionally, I am wanting to potentially revisit writing puts on AT&T (T) or others. I have been looking at National Retail Properties (NNN) or Realty Income (O) as I want to increase my position there anyway. All of these I have positions in already, but wouldn’t mind adding to. However, they don’t have weekly options either; so we are stuck with more limited options if going that route.
Disclosure: Long ABBV, T, NNN, O
This is not investment advice but for entertainment purposes only. Any decision to buy or sell is solely made by that individual. Speak with a financial professional to develop an investing plan that is right for your own objectives and goals.