Let’s say I sell 10 covered calls on a stock that expire 45 days out and make 1k premium. On day 5 the options I sold are down 80%, so I buy them back for 200 dollars, making 800. What do I do next? It’s still 40 days out if I sold more for that expiration, but premiums are basically dead. Do I sell for an even farther date or wait for a green day to sell again?

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You either lower the strike to get more premium or wait for the price of underlying to go up.

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Thanks new to this and just wanted to confirm that this makes sense

Your choices are pretty much based on your analysis of where you think the stock will go next:
1) if you think it’ll stay flat or continue pulling back, buy into a lower strike but same or shorter expiry
2) if you think this dip will have a bounce or the stock will come back, wait for some green before you re-enter your covered call. The easiest way to do this in TD ameritrade is:
- set a GTC limit order on your option at the price you want
- set a market condition order based on the underlying asset’s price to trigger selling a CC

I prefer to set conditional orders because stocks often pop up in the AM with spikes in IV and fade later in the day. It’s hard to catch the pops with a real job. And typically selling CCs are a low risk position where the biggest downside is potentially forgoing profits.

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Yes. Always set limit orders on options.

Selling out a farther strike may get you more premium but exposes to you to assignment risk (unless you are okay being assigned)

Just wait a few days until the price goes back up and then sell contracts again

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