Rate Of Return
OrdersOne thing I've realized is that you have to play Calls carefully.
I previously bought Nvidia Calls expiring on June 18, when the underlying stock price was around 180.
Now, the price is still around 180, but the corresponding option price has dropped by about 1.2.
There are two types of value loss here:
1. Time decay. The holding period for this option was about 10 days. The corresponding theta decay was about 0.6.
2. Loss from reduced volatility.
During the holding period, there was a significant price surge. (At that time, news came out that H200 could be supplied to China.) But it was around 1:30 AM, and I was already asleep—no chance to sell. The next day, the pre-market gradually absorbed the positive news, and the stock closed lower.
The lesson learned: Play Calls carefully. Only do it when there's a big drop.
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