The May option expiration was an interesting one. I managed to eke out a tiny profit and made decent progress whittling down the cost basis of several positions.

If anyone was looking for volatility, the market didn’t disappoint. There have been great opportunities to purchase quality companies at much better prices.

I said last month that the May expiration would give more clarity on where I stand, and that has turned out to be true. Let’s take a look at my results and see!

Results From Call Expiration

The profit realized this month was small at $234.74. It came from 3 stock options that were exercised–2 at a profit, and 1 at a loss.

The loss was from CRWD, but I was very pleased with the result. To put it in perspective, at one point the position was $63 per share under water, but I was able to close it with a loss of just over $3 per share–I’ll take it!

Here’s the results of the May 21st option expiration:

Airbnb (ABNB)Airbnb Logo

The cost basis of my 100 shares of ABNB was $175.01 per share, and the covered call premium I received was $10 per share for $1,000.

The strike price of the call was $175, and it was not exercised. After fees, my new cost basis is $165.01 per share. ABNB closed at $134.71 on the expiration date.

Lemonade (LMND)Lemonade Logo

My entire position in LMND is made up of 300 shares at a cost basis of $127.06 per share, and 200 shares purchased last month for $85.84 per share.

I sold 2 covered call options on the lesser priced shares at the $87 strike price and received $6.83 per share for $1,366. The call was not exercised, and my new cost basis of those shares is $79.08 after fees. LMND closed at $78.40 on expiration day.

Crowdstrike (CRWD)Crowdstrike Logo

The 100 shares of CRWD had a cost basis of $203.07 per share after I sold a call in March for $14.60 per share, which gave me $1,460.

The call was exercised at the $200 strike price. This resulted in a net loss of $307.58 after fees. As I stated above, this small loss is very acceptable for a stock that was down about $6,300 at one point.

Bandwidth (BAND)Bandwidth Logo

The cost basis of my 200 shares of BAND was $168.41 per share. I sold a $155 call for a premium of $2.70 per share for $540.

The option was not exercised, but it did lower my cost basis to $165.71 per share, after fees.  BAND closed at $116.60 at expiration.

Innovative Industrial Properties (IIPR)IIPR Logo

My cost basis in the 100 shares of IIPR is $192.29 per share after selling a call in March. I had received a premium of $10 per share for $1,000.

This option also was not exercised, and my cost basis has not changed. IIPR closed at $173.01 at expiration.

Square (SQ)Square Logo

The same scenario played out with SQ. The call option sold in March reduced the cost basis in my 100 shares to $240.21 per share. At the $240 strike price, the call was not exercised, and the cost basis remained unchanged.

SQ closed at $200.01 on expiration day.

Appian (APPN)Appian Logo

The 200 shares of APPN consist of 100 shares at a cost basis of $165.68 per share, and 100 shares purchased at $135.15 per share.

I had sold 1 contract in March at the $165 strike price for the higher prices shares and received a premium of $16.63 per share for $1,663. After purchasing the additional shares, I sold another contract for $9.74 per share for $974 at the strike price of $140.

Neither of the options were exercised. So the cost basis of the original shares did not change, and the cost basis of the additional shares is $125.42 per share.  APPN closed at $82.32 on expiration day.

For stocks like APPN where the purchase price of shares is significantly different, I’ll be keeping track of each purchase separately for the cost basis.

This will enable me to sell options based upon the lower purchase prices and keep better track of the progress of all the buy/sell/option writing decisions I make.

Fiverr (FVRR)Fiverr Logo

My 200 shares of FVRR consist of 100 shares with a cost basis of $260.96 per share after selling a call in March, and 100 shares purchased at $160.51.

I then sold a covered call at an in-the-money strike price of $155 for $9 per share giving me $900. This option was exercised with a profit of $348.16 after fees.

While the profit was small for a volatile stock like FVRR, the call was written with the intention of protecting my position from further downside instead of trying to maximize a profit.

The original call written in March was not exercised. So I still have 100 shares with a cost basis of $260.96 per share. FVRR closed at $183.10 on the expiration date.

Fastly (FSLY)Fastly Logo

I sold 2 calls in March for my 200 shares of FSLY at the $85 strike price. The cost basis after the call was $84.89 per share, and the premium was $4.50 per share for $900.

The call option was not exercised, so the cost basis remains unchanged. FSLY closed at $44.87 at expiration.

Skillz (SKLZ)Skillz Logo

I had 400 shares of SKLZ at a cost basis of $24.29 per share. The 4 call options written had a $23 strike price, and I received $2 per share for $800.

Then I purchased 400 additional shares for $14.31 per share and sold 4 June 18 calls at the $15 strike price. The premium for those options was $1.42 per share for $568.

The options on the original 400 shares were not exercised, and the new cost basis of those shares is $22;30 after fees. SKLZ closed at $15.21 on the day of expiration.

Stitch Fix (SFIX)Stitch Fix Logo

My 300 shares of SFIX and the cost basis is $48.86 per share. I sold 3 contracts at the $47 strike price and received a premium of $2.50 per share for $750.

The options were not exercised, and the new cost basis for SFIX is $46.66 after fees. SFIX closed at $46.77 on expiration day.

Village Farms International (VFF)Village Farms Logo

The 700 shares of VFF had a cost basis of $10.70 per share. I wrote 7 call options on the $12 strike price at $.75 per share for $525.

The options were not exercised, and the new cost basis for my shares is $9.95 per share. VFF closed at $8.68 on expiration day.

Pinterest (PINS)

My 300 shares of PINS have a cost basis of $72.86 per share. I sold 1 call option at the $73 strike price for $6.00 per share and 2 calls at the $75 strike price for $5.99 per share.

Before fees, my premium received was $1,798 total before fees. None of the options were exercised, and my new cost basis is $66.87 per share after fees. PINS closed at $60.86 on the expiration date.

Etsy (ETSY)Etsy logo

The cost basis of my 100 shares of ETSY is $158.70. I wrote a call at the $150 strike price with a premium of $10.65 per share for $1,065.

This call was written in the money since the market was dropping rapidly, and I wanted downside protection more than going for a larger profit.

It was exercised, which resulted in a profit of $194.16 after fees. The outcome was going to be this small profit or owning 100 shares of ETSY with a cost basis below $150. Either way was good for me!

Trading Notes

Overall, I’m pleased with the results this month. The tech sector took another nosedive, and I was able to capitalize on the lower prices to add to my positions.

This enabled me to write covered calls and receive some good premiums. Considering that several calls had been written in March, and there was no money coming in this month from those positions, I liked being able to bring in some more cash.

Strategy Changes Going Forward

If the stock prices stay low, I’ll continue to add to my positions where it makes sense. This will help me reduce my cost basis in those stocks considerably.

I’ll have to be mindful of the fact that, in spite of how far prices have fallen in the tech sector, there’s no way to predict how far they’ll fall before making a significant comeback.

So making option trades with downside protection in mind is still going to be a main focus moving into the next month.

New Format For New Options

I normally would continue this post by detailing the option trades I write for the next month’s expiration. But I’m going to start publishing those trades in another post.

This gives me the opportunity to get my results out to my readers much more quickly after expiration. So look for my new covered call options for the June 18th expiration in a few days!

Janelle Signature