Our hedged synthetic covered call position on XBI has one week to go and we’re sitting with a solid profit. We have roughly 2.91 of credit built up depending on your fill prices. It will cost around a net 0.60 debit to close the position leaving us with around 2.30 of profit per contract or around $1,100 to $1,100 of net profit for the trade.
Let’s close the position and take the gains.
SPDR S&P Biotech ETF (XBI): 82.91
TRADE ACTION 1: CLOSE the XBI 30 Dec 83 call and the 23 Dec 83 call for a net credit of around 0.70
STC the XBI 30 Dec 83 call
BTC the XBI 23 Dec 83 call
TRADE ACTION 2: CLOSE the XBI 30 Dec 83 put and the 30 Dec 78 put for a net debit of around 1.30
STC the XBI 30 Dec 78 put
BTC the XBI 30 Dec 83 put
The Master Portfolio is trading 5 contracts