I am recommending we roll our protective puts on VanEck Vectors Semiconductor ETF (SMH) and Target (TGT) to lower strike prices while keeping the expiration date the same. This allows us to keep our hedges in place while taking some profits off the table. The profits we book will reduce our cost basis on the positions.
SMH Sep Week Four (9/23) 195 Put
Note: No action is needed on the SMH Jan 2023 (1/20/23) 250 Call at this time.
Current Stock Price: $195.84
Cost Basis: $47.50
Action:
- Sell to close the SMH Sep Week Four (9/23) 195 Put for around $1.94
- Buy to open the SMH Sep Week Four (9/23) 192 Put for around $0.92
- Set initial credit limit at $1.02, but adjust as needed to roll today
New Cost Basis: $46.48
TGT Sep Week Four (9/23) 155 Put
Note: No action is needed on the TGT Jan 2024 Monthly (1/19/24) 150/Sep Week Five (9/30) 180 Call Spread at this time.
Current Stock Price: $153.57
Cost Basis: $49.11
Action:
- Sell to close the TGT Sep Week Four (9/23) 155 Put for around $2.44
- Buy to open the TGT Sep Week Four (9/23) 152.50 Put for around $1.21
- Set initial credit limit at $1.23, but adjust as needed to roll today
New Cost Basis: $47.88