Hi everyone, currently own 5 shares of NVDA and planning on purchasing an additional 5 more before stock spilt in order to be able to execute covered calls.
My question here would it be better to wait and let the share price adjust itself after the split? I’ve been doing tons of research on options specifically covered calls so this would be my first time executing one. Would love to hold my position with nvda LONG term, as I just want a bit more monthly income.
Any tips would greatly be appreciated! Thank you.
Posted by Hot_Necessary_1974
2 Comments
What do you want to hear? That you can do covered calls with 10 shares so you can get a bit more monthly income? Ok. You go girl
I have no clue what Nvda will do in the future. However after the split prices might spike a little , but usually then drop a bit. The split itself has no real impact , it is a straight 10 for 1. There will however be more option activity on the option, so prices will get closer which is better for retail investors. You might think you are saving $6 in commissions by getting the pre split and selling the option on it but that after that you will have 10 options outstanding (as far as I know). Also you could get involved with some non standard expiration and strikes. I would wait until after the split and then a week or two for it to settle.