Hello Mr Wolfinger,
1) When your friend suggested the trade, it was his responsibility to explain what you had to gain or lose.
2) Yes there is a way to make a reasonable estimate of the value of your position at May expiration when the stock is $63. But with 'some certainly' - no. Cannot do that. Why? The value of an option is quite dependent on the implied volatility (IV) of that option. The more time in the life of the option, the larger the effect of IV. There is just no good way to know what it will be in May. In Nov 2008, VIX (IV of S&P 500 index options) was 90. Today it is 17.
3) If you use an option calculator and try some various IV levels, you will get a decent of idea of where your Jan call will be trading. But it's just an idea. Try this calculator, although your broker ought to have one for you to use.
4) That said, this is a really dumb idea for you. It's not a bad play in and of itself. But you are looking for the stock to rise. You want the chance to earn more money than this spread allows.
5) I love the idea of buying the Jan 40 call @ only $0.50 time premium over the price of the stock. That way you don't have to spend the $5,900. You spend only $1,950. Interest rates are low, but you can earn some interest with the other $4,000.
6) If you are truly bullish, do you want to write a covered call, or is that merely the suggestion of your friend? I love writing covered calls and like the idea in this situation. But if you are bullish do you want to do that? Perhaps a call with a higher strike price would be more suitable. Perhaps waiting for the stock to move higher and then sell the call would work.
7) If you are thinking of buying back the stock at May expiration, then it truly makes zero sense to sell a call option hat is already in the money.
Again he did suggest the right call to buy. Give him credit for that. But by failing to explain the whole trade idea, he did no service. I don't know which call you should sell - because I don't know how much faith you have in your prediction. Nor do I know how much risk you are willing to take. But definitely begin with that Jan call - if you can get it for only $0.50 over parity.
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