As I stated in the previous alert, we are going to allow our shares of Advanced Micro Devices (AMD) and Taiwan Semiconductor Manufacturing (TSM) to be called away at the $75 strike price.
I will be recommending that we use the $7,500 received per 100 shares of AMD and TSM you own to purchase LEAPS. We will then sell calls against those LEAPS to generate income that will reduce our net debits on the positions.
This recovery strategy is meant to get us back to breakeven much faster than we could by selling calls or puts.
Note that TSM is scheduled to report earnings on July 14. We will be waiting until after the announcement to initiate this recovery strategy in TSM, as well as AMD, which could move with the sector following Taiwan Semiconductor’s announcement.
AMD Jul Week Two (7/8) 75 Call
Current Stock Price: $80.17
Cost Basis: $113.20
Action: Allow shares to be called away
Net Debit: $38.20
TSM Jul Week Two (7/8) 75 Call
Current Stock Price: $81.95
Cost Basis: $119.91
Action: Allow shares to be called away
Net Debit: $44.91