I am recommending we roll our Apple (AAPL) and Corning (GLW) puts to avoid assignment and buy more time (actually, we get paid for it!) for shares to move higher.
And let’s book fast profits on our Marvell Technology Group (MRVL) position. There’s no sense looking a gift horse in the mouth in a market as bumpy as this one
AAPL Sep Week Four (9/25) 110 Put
Current Stock Price: $108.69
Cash in Hand: $1.69
Action:
- Buy to close the AAPL Sep Week Four (9/25) 110 Put for around $2.36
- Sell to open the AAPL Oct Week One (10/2) 110 Put for around $4.12
- Set your initial credit limit at $1.76, but adjust as needed to roll today
New Cash in Hand: $3.45
Expiration: After the close on Friday, Oct. 2
Potential Rate of Return: 3.1% in 17 days, or 68% on an annualized basis, if this option expires worthless
GLW Sep Week Four (9/25) 32.50 Put
Current Stock Price: $30.69
Cash in Hand: $0.41
Action:
- Buy to close the GLW Sep Week Four (9/25) 32.50 Put for around $1.84
- Sell to open the GLW Oct Week Two (10/9) 32.50 Put for around $1.92
- Set your initial credit limit at $0.08, but adjust as needed to roll today
New Cash in Hand: $0.49
Expiration: After the close on Friday, Oct. 9
Potential Rate of Return: 1.5% in 24 days, or 23% on an annualized basis, if this option expires worthless
MRVL Sep Week Four (9/25) 37.50 Put
Current Stock Price: $38.31
Cash in Hand: $0.48
Action: Buy to close the MRVL Sep Week Four (9/25) 37.50 Put
Current Option Price: $0.14-$0.18
Recommended Limit: Set your initial limit order at $0.16, but adjust as needed to close the position today
Profit: $0.32, or $32 per contract
Rate of Return: 0.9% in three days, or 104% on an annualized basis