ThetifyDaily scenario: SPY 2019-02-28
SPY, 2019-02-28: spot $249.30. You own 100 shares and are short the $248 covered call opened at $6.70, now $3.49, 5 DTE. IV 23.9% vs HV 20.7%. Over the previous 21 trading days SPY moved +5.8%; it closed 4.1% below its 52-week closing high.
- AHold the position
- BTake profit: buy it back
- CRoll out: same strike, later expiry
- DLet the shares be called away at the strike
What would you do?
The answer and the worked numbers for every choice are in the Thetify app.
Where the position stood
| Underlying | SPY |
|---|---|
| Date | 2019-02-28 |
| Stock price | $249.30 |
| Position | 100 shares + short the $248 covered call |
| Stock vs strike | 0.5% above the strike (in the money) |
| Opened at → now | $6.70 → $3.49 |
| Implied volatility (IV) | 23.9% |
| Historical volatility (HV) | 20.7% |
| Days to expiration | 5 |
Under this scenario’s assumptions. Every number in this table is already in the scenario text above; nothing comes from what happened afterwards.
Run these numbers yourself
Open the calculator with this scenario’s price, strike, days, IV and HV already typed in, and read the premium, delta and probabilities for yourself. The calculator leaves out dividends, so its readings can differ slightly from the scenario’s own.
Terms in this scenario
- DTE (days to expiration): The number of calendar days left until the contract expires.
- Implied volatility (IV): The volatility figure that makes the model price equal the price the option actually trades at.
- Historical volatility (HV): How much the stock actually moved over a past window, stated in annualised terms.
Same kind of decision
Three more scenarios of the same kind: managing a covered call.
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