I am recommending we exit our KB Home (KBH) position by buying back our call and selling our shares. Our recovery strategy has allowed us to significantly reduce our potential loss, and I want to put this capital to better use elsewhere.
I am also recommending we roll our Western Digital (WDC) call out two weeks to generate more income.
KBH Nov Monthly (11/19) 42 Call
Current Stock Price: $43.62
Cost Basis: $42.88
- Buy to close the KBH Nov Monthly (11/19) 42 Call for around $1.65
- Sell shares at market
Loss: $0.91, or $91 per 100 shares
WDC Nov Monthly (11/19) 56 Call
Current Stock Price: $55.17
Cost Basis: $55.99
- Buy to close the WDC Nov Monthly (11/19) 56 Call for around $0.30
- Sell to open the WDC Dec Week One (12/3) 56 Call for around $1.45
- Set initial credit limit at $1.15, but adjust as needed to roll today
New Cost Basis: $54.84