Our Salesforce (CRM) spread does not expire for another 10 days, but the price has already fallen to around a dime. It’s not worth the risk of holding that long to eek out a few more cents in premium.
Let’s close it now, booking a 4.2% return over our $500 in capital allocated. And since the trade was open just five days, our annualized rate of return is 307%.
Current Stock Price: $155.50
Cash in Hand: $0.30
- Buy to close the CRM Oct Week Two (10/14) 130 Put for around $0.18
- Sell to close the CRM Oct Week Two (10/14) 125 Put for around $0.09
- Set initial debit limit at $0.09, but adjust as needed to close today
Profit: $0.21, or $21 per spread