The OpenAI bump is pretty serious business. In my previous post I mentioned how I am optimistic about Shopify (SHOP). The business has good fundamentals, a pretty strong competitive moat, and is not US-based. During the week OpenAI announced a partnership with Shopify that added almost $15 to the share price. Quite the bump.

The SHOP shares I picked up opportunistically a few weeks ago to sell covered call options ended up getting assigned. Naturally I could have purchased the options before close today, but since I was already profitable on both the share price and the options, it was better to simply let them go.

My covered call strategy is to only buy back options at risk of assignment if:

• The assignment price would put my initial investment at a loss. For example, if my purchase price was 100, the stock had slid to 70, I sold options at 90, and the price approaching the expiration was between 90-100. This rarely happens, but it has typically been less of a loss to re-buy the call option close to expiration.
• There's a strong signal that there may be more upside the following week or two on the option. Additional upside would ensure that the cost of buying the options back would be recouped before close.

In the case of SHOP, neither criteria were met. I allowed the options to be assigned and will take my profit for another day.