What is this?
The instructor's real HK stock case from the Single-Direction Masterclass: 1347.HK Hua Hong Semiconductor. It shows how, in a one-way rising market, you lock in the risk first, then lock in the profit step by step.
What did he do?
Opened with a Calendar Spread, then rolled step by step as the share price rose. The actual amounts at every step (8 sets of contracts; each contract = 2,000 shares):
| Date | Action | Premium/share (HKD) | Cash flow (HKD) |
|---|---|---|---|
| 11 Nov | Long Call $77.5 · Dec expiry — premium paid | -$6.24 | -$99,840 |
| 11 Nov | Short Call $77.5 · Nov expiry — premium received | +$3.60 | +$57,600 |
| Net opening cost = maximum loss (worst case locked in from day one) | -$42,240 | ||
| 21 Nov | Time value exhausted — bought back the Nov Short Call at $1.26, locking in +$2.34/share profit | -$1.26 | -$20,160 |
| 21 Nov | Short Call $80 · Dec expiry — new round of premium received | +$3.70 | +$59,200 |
| Cumulative net cost = maximum loss (cut sharply within two weeks) | -$3,200 | ||
From then on, each time the share price climbed another level, the same "close the old position, open a new one" roll was repeated, locking the profit in tier by tier:
| When | Action | Share price |
|---|---|---|
| 11 Nov 2025 | Opened position (maximum loss $42,240) | ≈$77 |
| 21 Nov 2025 | First roll (maximum loss cut to $3,200) | $77–$80 |
| Dec 2025 to Jun 2026 | Repeated rolls — closed old positions to lock in profit, opened new ones to keep collecting rent | $80 rising through $157 |
| 10 Jul 2026 | Holdings as below — profit fully locked in | Above $157 |
The holdings on 10 Jul — four combinations, each with a crystal-clear value at expiry:
| Position | Contracts | Value at expiry (HKD) | Henry Wong's take |
|---|---|---|---|
| ① Long Call $157.5 + Short Call $165 · Jul expiry | ×8 | Up to +$120,000 Worst case $0 | Upside engine — pays out in full if the share price is ≥$165 |
| ② Long Put $162.5 + Short Put $157.5 · Jul expiry | ×8 | Up to +$80,000 Worst case $0 | Downside insurance — pays out in full if the share price is ≤$157.5; together with ①, at least +$80,000 whether the market rises or falls |
| ③ Long Call $167.6 + Short Call $177.5 · Jul expiry | ×8 | Up to another +$158,400 Worst case $0 | Extra upside — pays out in full if the share price is ≥$177.5 |
| ④ Short Call $172.5 + Long Call $175 · Aug expiry | ×16 | Loses at most $80,000 Expires worthless with nothing to pay if the share price is ≤$172.5 | Keep collecting rent — only loses if the price rises through $175; by then ① and ③ pay out big, more than covering it |
What was the result?
| Settlement item | Amount (HKD) |
|---|---|
| Net premium banked (Ppb +$9.67/share ×8, all trading costs included) | +$154,720 |
| Guaranteed value of ① + ② at expiry (at least $5/share × 2,000 shares × 8 sets, whether the market rises or falls) | +$80,000 |
| Minimum total profit, whatever the share price does next | +$234,720 (≈ 5.6× the original cost of $42,240) |
What's the lesson?
- Lock in the risk before you open — the worst outcome is written in stone from day one
- Roll step by step as the market rises, locking profit in tier by tier — after that, no fall can hurt you