I am recommending we roll our Apple (AAPL) and Generac Holdings (GNRC) calls out one week and to lower strike prices to generate more income and reduce our cost basis on the positions.
Apple has been bit by analyst forecasts of reduced iPhone sales due to COVID-19 lockdowns in China. Meanwhile, Generac Holdings has moved from overbought to oversold. I remain confident on both stocks long term and premiums are huge, so we will continue to trade them.
AAPL Dec Week Two (12/9) 148 Call
Current Stock Price: $140.89
Cost Basis: $153.51
Action:
- Buy to close the AAPL Dec Week Two (12/9) 148 Call for around $0.12
- Sell to open the AAPL Dec Monthly (12/16) 145 Call for around $1.97
- Set initial credit limit at $1.85, but adjust as needed to roll today
New Cost Basis: $151.66
GNRC Dec Week Two (12/9) 105 Call
Current Stock Price: $91.45
Cost Basis: $105.06
Action:
- Buy to close the GNRC Dec Week Two (12/9) 105 Call for around $0.05
- Sell to open the GNRC Dec Monthly (12/16) 100 Call for around $1.40
- Set initial credit limit at $1.35, but adjust as needed to roll today
New Cost Basis: $103.71