I am recommending we sell a call on our uncovered Microsoft (MSFT) shares to lower our cost basis. If you do not currently own MSFT shares from a previous position, please sit this trade out.
Let’s also sell a put on Starbucks (SBUX) to chip away at our sizeable net debit on the position. You can enter today’s trade even if you were not in the previous one. Just be aware that we will be tracking and managing it as an ongoing position.
MSFT Uncovered Shares
Current Stock Price: $205.46
Cost Basis: $213.95
Action: Sell to open the MSFT Sep Week Four (9/25) 207.50 Call for around $1.50
New Cost Basis: $212.45
Current Stock Price: $84.63
Net Debit: $14.82
Action: Sell to open the SBUX Sep Week Four (9/25) 83.50 Put for around $0.48
New Net Debit: $14.34