I am recommending we close our Lululemon Athletica (LULU) and Roku (ROKU) bull put spreads rather than risk holding through expiration.
We will be exiting the LULU position with a loss, as I do not like the way the stock is trading. With ROKU, we will be accepting a smaller profit, but we’re still earning 2.4% in nine days, or 97% annualized.
LULU Oct Week One (10/1) 400/390 Put Spread
Current Stock Price: $400.38
Cash in Hand: $0.20
Action:
- Buy to close the LULU Oct Week One (10/1) 400 Put for around $1.65
- Sell to close the LULU Oct Week One (10/1) 390 Put for around $0.17
- Set initial debit limit at $1.48
Loss: $1.28, or $128 per spread
ROKU Oct Week One (10/1) 300/290 Put Spread
Current Stock Price: $308.66
Cash in Hand: $0.50
Action:
- Buy to close the ROKU Oct Week One (10/1) 300 Put for around $0.41
- Sell to close the ROKU Oct Week One (10/1) 290 Put for around $0.15
- Set initial debit limit at $0.26
Profit: $0.24, or $24 per spread