Editor’s note: This is a reminder that there will be no Market Update or Live Trading Session next week. We will resume after the Labor Day holiday. Michael will be monitoring open positions and send alerts if needed.
We have positions in Bank of America (BAC) and Blackstone Group (BX) expiring today.
Our BAC shares are on track to be called away at a small profit after we dug our way out from an underwater position.
I am recommending we spend a little cash to close our BX put, locking in a great rate of return.
BAC Aug Week Four (8/28) 25.50 Call
Current Stock Price: $26.13
Cost Basis: $25.26
Action: Allow shares to be called away
Profit: $0.24, or $24 per 100 shares
Rate of Return: 0.9% in 81 days, or 4% on an annualized basis
BX Aug Week Four (8/28) 53 Put
Current Stock Price: $53.07
Cash in Hand: $0.61
Action: Buy to close the BX Aug Week Four (8/28) 53 Put
Current Option Price: $0.18-$0.26
Recommended Limit: Set your initial limit order at $0.22, but adjust as needed to close today
Profit: $0.39, or $39 per contract
Rate of Return: 0.7% in 11 days, or 24% on an annualized basis