Option Premium Calculation: Trading NVAX, RUM, GRAB, and TLRY Weekly Options

Tracking Option Premiums Across Multiple Positions

Managing multiple option positions across different brokerages requires systematic tracking to ensure accurate cost basis calculations and premium collection records. In this detailed walkthrough, we'll track option trades executed across four different stocks: Novavax (NVAX), Rumble (RUM), Grab Holdings (GRAB), and Tilray (TLRY), demonstrating how to properly record covered calls and cash-secured puts for weekly income generation.

This session resulted in collecting $205 in option premium for the week, bringing year-to-date premium totals to $784. The process showcases how systematic tracking allows option sellers to maintain accurate records across multiple brokerages while monitoring their weekly average premium collection, which currently stands at approximately $271 per week.

The key to successful option income generation isn't just executing trades—it's maintaining meticulous records that allow you to see your true performance, adjust your strategies, and ensure every dollar of premium is properly accounted for in your cost basis calculations.

Recording RUM Option Positions Across Two Brokerages

Rumble (RUM) presents an interesting case study in this session because positions were opened across two different brokerages—Robinhood and TD Ameritrade—demonstrating the importance of centralized tracking when your option selling activity spans multiple platforms.

Robinhood RUM Position: Long-Dated Covered Call

The first RUM transaction was a covered call position in Robinhood that required going out significantly further in time than typical weekly options:

  • Transaction Type: Sell to open call
  • Contracts: 3 contracts
  • Expiration Date: January 20, 2023 (approximately one month out)
  • Strike Price: $11.00
  • Premium Per Contract: $0.09
  • Total Premium Collected: $27.00

This position required a much longer duration because RUM wasn't providing attractive premiums on shorter-dated options at the time. When weekly premiums become too thin to justify the position management overhead, extending duration to monthly options can maintain acceptable premium yields while reducing the frequency of position adjustments.

Key Insight on Premium Erosion: When a stock's premium structure deteriorates significantly—as noted with RUM no longer "putting out premiums like it used to"—option sellers must adapt by either extending duration, adjusting position size, or reallocating capital to more premium-rich opportunities. This flexibility is essential for maintaining consistent income generation.

TD Ameritrade RUM Position: Weekly Cash-Secured Put

The second RUM position was a short-term cash-secured put opened through TD Ameritrade with significantly different characteristics:

  • Transaction Type: Sell to open put
  • Contracts: 1 contract
  • Expiration Date: December 23, 2022 (this Friday, 3 days out)
  • Strike Price: $7.50
  • Premium Collected: $20.00 (after TD Ameritrade fees)

This weekly put position demonstrates the put side of the wheel strategy, where you're willing to accumulate shares at the strike price while collecting premium. The TD Ameritrade transaction includes the broker's fees already deducted, which eliminates the need for later reconciliation—unlike Robinhood positions that may require adjustment once final settlement occurs.

Managing Multi-Brokerage Tracking

Having RUM positions in both Robinhood and TD Ameritrade highlights the critical value of centralized cost basis tracking. Without a unified tracking system, it becomes increasingly difficult to:

  • Understand your total exposure to a single underlying across all accounts
  • Calculate your true cost basis when premiums and assignments occur across platforms
  • See your aggregate premium collection for a specific ticker
  • Make informed decisions about position sizing and risk management

This is precisely the problem MyATMM was built to solve—providing a single unified view of all your option positions regardless of which brokerage holds them, ensuring accurate cost basis tracking and complete premium accounting.

GRAB Holdings: Short-Duration Covered Call

The Grab Holdings position represents a typical short-duration covered call strategy executed through Robinhood:

Parameter Details
Transaction Type Sell to open call
Contracts 2 contracts
Expiration Date December 30, 2022
Strike Price $3.50
Premium Per Contract $0.14
Total Premium $28.00

This GRAB position demonstrates the standard process of recording a covered call in your tracking system. The position uses a 10-day duration (expiring December 30) and involves selling calls against existing share holdings to generate income while capping upside at the $3.50 strike price.

Recording Process for Robinhood Transactions

The recording workflow shown for both RUM and GRAB positions in Robinhood follows a consistent pattern:

  1. Create New Position: Navigate to the ticker's cost basis page and initiate a new position entry
  2. Select Transaction Type: Choose "sell to open" and specify whether it's a call or put
  3. Enter Contract Details: Record the number of contracts, expiration date, and strike price
  4. Input Premium Amount: Enter the premium received per contract (the system calculates total premium)
  5. Save as Proposed: Initially save the transaction as "proposed" rather than finalized
  6. Move to History: Transfer the proposed transaction into your transaction history to complete the record

Why Use "Proposed" Status First? The two-step process of first creating a proposed transaction and then moving it to history provides a quality control checkpoint. This allows you to review the details before finalizing, catching any data entry errors before they affect your cost basis calculations. It's particularly valuable when entering multiple transactions in a batch, as shown in this session.

For Robinhood transactions specifically, you may need to return later to reconcile the final premium amount after fees are assessed. Robinhood doesn't always show the exact post-fee premium at order execution, so the initial entry might require adjustment once the trade fully settles.

Tilray (TLRY): Weekly Cash-Secured Put

The Tilray position executed through TD Ameritrade represents another weekly cash-secured put, demonstrating the repetitive nature of systematic option income generation:

TLRY Trade Details

  • Transaction Type: Sell to open put
  • Contracts: 1 contract
  • Expiration Date: December 23, 2022 (this Friday)
  • Strike Price: $3.00
  • Premium Collected: $11.00 (net after fees)

This position illustrates selling puts at the $3.00 strike price, indicating a willingness to purchase TLRY shares at that price if assigned while collecting $11 in premium for taking on that obligation. With a three-day duration until expiration, this represents a typical end-of-week option position targeting quick premium collection with minimal time exposure.

TD Ameritrade Transaction Advantages

One significant operational advantage mentioned during the recording process is that TD Ameritrade transactions show the exact net premium after fees upfront. This eliminates the reconciliation step required for Robinhood transactions:

  • No Reconciliation Required: The premium amount displayed is already net of commissions and fees
  • Immediate Accuracy: Your cost basis calculations are immediately accurate without waiting for settlement
  • Simplified Workflow: Reduces administrative overhead and potential for errors in premium tracking
  • Better Planning: Know exactly what you'll net from the trade at execution

This transparency in fee structure makes TD Ameritrade transactions slightly easier to track and record, though the difference is minor when using proper tracking software that accommodates both approaches.

Novavax (NVAX): Managing a Deep Position with Continued Premium Collection

The NVAX position represents a more complex scenario that many option sellers eventually face: managing a position that has moved significantly against you while continuing to generate premium income.

The NVAX Situation

As noted during the recording: "We're in this a little deep. The prices continue to fall and we're dollar cost averaging down. We're still selling calls and I have gone through here and entered some of the calls but we're not getting much premium so I didn't record it. But we're still playing the put side and the put side we're still getting full premiums down there."

This candid assessment reveals several important aspects of real-world option selling:

  • Underwater Positions: The share holdings are below the original cost basis as NVAX prices declined
  • Dollar Cost Averaging: Continuing to accumulate shares at lower prices to reduce average cost basis
  • Asymmetric Premium Structure: Call premiums have become thin (not worth recording), but put premiums remain attractive
  • Strategic Focus Shift: Concentrating on the put side where premium opportunities still exist

Current NVAX Put Position

Despite the challenging situation, the session's NVAX transaction demonstrates continued premium collection:

Parameter Details
Transaction Type Sell to open put
Contracts 1 contract
Expiration Date December 23, 2022 (this Friday)
Strike Price $11.00
Premium Collected (Gross) $90.00
Premium After Fees $89.34

At $89.34 in premium for a single weekly contract, this NVAX put represents by far the largest premium collected in this session. The substantial premium reflects both the volatility in NVAX and the risk premium associated with potentially acquiring more shares of a stock that has already declined significantly.

Key Lesson on Position Management: When a position moves against you, the wheel strategy can still function to reduce your cost basis through continued premium collection. While not ideal, this approach allows you to methodically work down your average cost while maintaining exposure for potential recovery. However, this strategy requires strong conviction in the underlying company and careful position sizing to avoid overconcentration.

Strategic Considerations for Deep Positions

The NVAX example highlights several considerations when managing positions that have moved significantly against you:

  • Premium Asymmetry: As stocks decline, put premiums often remain robust while call premiums deteriorate. This is because put buyers are willing to pay for downside protection, while call buyers have less interest in stocks with negative momentum
  • Selective Recording: When call premiums become too small to justify the tracking effort (as mentioned for NVAX), you may choose to execute them without detailed recording while continuing to track the more substantial put premiums
  • Continued Commitment: The decision to keep selling puts deeper into a declining position represents a significant strategic choice. You're essentially committing more capital to a position that hasn't performed well, banking on eventual recovery or at least stabilization
  • Risk Management: This approach works only if your position sizing allowed for this type of averaging down. If NVAX represented too large a portion of your portfolio initially, continued accumulation could create dangerous concentration risk

Weekly Performance Review and Portfolio Projections

After recording all the week's transactions, the session concludes with a performance review using the dashboard's premium tracking and projection features. This review process is essential for understanding whether your option selling activity is meeting your income goals.

Weekly Premium Collection Summary

The week's activities resulted in the following premium collection:

  • Previous Month-to-Date Premium: $579.00
  • New Month-to-Date Premium: $784.00
  • Weekly Increase: $205.00
  • Year-to-Date Premium Total: $4,486.00

Premium Breakdown by Position

  • NVAX put: $89.34 (43.6% of weekly total)
  • GRAB calls (2 contracts): $28.00 (13.7%)
  • RUM call (3 contracts): $27.00 (13.2%)
  • RUM put: $20.00 (9.8%)
  • TLRY put: $11.00 (5.4%)
  • Other positions (not detailed): ~$30.00 (14.3%)

Average Weekly Premium Analysis

The platform's projections tab reveals important trend information: "Right now we're weekly averaging about $271 dollars a week based off everything we've collected and everything we've done so far."

This $271 weekly average provides crucial context:

  • Current Week Performance: At $205, this week came in about 24% below the running average
  • Monthly Projection: At $271/week average, this projects to approximately $1,174 per month
  • Annual Projection: Extrapolating the current weekly average suggests approximately $14,092 in annual premium income
  • Consistency Tracking: Monitoring the weekly average helps identify trends, seasonal patterns, and the impact of market conditions on premium availability

Understanding Premium Variability: Weekly premium collection will naturally fluctuate based on market volatility, the number of positions expiring and being rolled, and strategic decisions about which opportunities to pursue. The $200-per-week range mentioned appears to be a consistent baseline, with the overall average around $271 suggesting periodic larger premium collection weeks that pull the average higher.

Year-to-Date Progress

With December 20th positioning in the final weeks of the year, the year-to-date total of $4,486 in premium collection demonstrates sustained option income generation throughout the year. The month-by-month breakdown visible on the dashboard allows for analysis of seasonal patterns and identification of particularly strong or weak periods.

This type of historical tracking becomes invaluable for:

  • Setting realistic goals for the following year based on actual performance
  • Identifying which quarters or months tend to produce the best premium opportunities
  • Understanding how your position sizing and strategy adjustments have impacted results
  • Providing data for tax planning and income projections

How MyATMM Simplifies Multi-Position Option Tracking

This session's demonstration of tracking five option positions across two brokerages and four different tickers highlights exactly why purpose-built option tracking software is essential for serious option sellers.

Challenges Solved by Centralized Tracking

Without a unified tracking system, managing the type of activity shown in this session becomes increasingly complex:

  • Multi-Brokerage Complexity: Tracking positions across Robinhood and TD Ameritrade requires logging into multiple platforms and mentally aggregating your exposures
  • Fee Reconciliation: Different brokerages handle fee disclosure differently, requiring different reconciliation workflows
  • Cost Basis Calculations: Each premium collected, assignment, and share transaction affects your cost basis, creating complex calculations across multiple tickers
  • Performance Analysis: Understanding your true weekly, monthly, and annual premium generation requires aggregating data from all positions and brokerages
  • Historical Records: Maintaining accurate historical records for tax purposes and strategy analysis becomes unwieldy in spreadsheets

MyATMM's Solution

MyATMM addresses these challenges with features specifically designed for option sellers:

  • Single Unified View: All positions across all brokerages in one place, showing your complete exposure to each ticker
  • Automatic Cost Basis Calculations: Every premium collected, share purchase, and assignment automatically updates your cost basis
  • Proposed Transaction Workflow: Enter transactions as "proposed" first, review them, then move to history for quality control
  • Performance Dashboards: Instantly see your weekly averages, monthly totals, and year-to-date premium collection
  • Projection Tools: Understand what your current activity level means for annual income projections
  • Complete Transaction History: Every trade recorded and searchable for tax preparation and strategy analysis

The platform was built by an option seller who faced these exact tracking challenges, which is why it focuses exclusively on the features that matter for covered call and cash-secured put strategies rather than trying to be a general-purpose portfolio tracker with hundreds of features you'll never use.

Important Risk Disclaimer

Options trading involves significant risk and is not suitable for all investors. Selling covered calls and cash-secured puts can result in substantial losses, including the potential loss of your entire investment. The positions described in this article, particularly the NVAX example of averaging down into a declining position, represent strategies that carry substantial risk and may not be appropriate for all traders.

Past performance does not guarantee future results. The premium collection amounts and percentages discussed are historical examples and should not be interpreted as indicative of future returns. Market conditions, volatility levels, and individual stock performance vary significantly over time.

This content is provided for educational purposes only and should not be considered financial advice or a recommendation to engage in any particular trading strategy. Always consult with a qualified financial advisor before making investment decisions, and never risk capital you cannot afford to lose.

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