I am recommending we roll our Bank of America (BAC) and Citigroup (C) puts out two weeks to generate more income and reduce our net debits on the positions.
Note that these rolls will take us out past the June Federal Reserve meeting, which could lead to volatility in the financial services sector.
You can enter the second leg of today’s trades even if you were not in the previous ones. Just be aware that we will be managing and tracking them as ongoing positions.
BAC Jun Week One (6/3) 34.50 Put
Current Stock Price: $36.22
Net Debit: $8.27
Action:
- Buy to close the BAC Jun Week One (6/3) 34.50 Put for around $0.04
- Sell to open the BAC Jun Monthly (6/17) 35 Put for around $0.56
- Set your initial credit limit at $0.52, but adjust as needed to roll today
New Net Debit: $7.75
Expiration: After the close on Friday, June 17
Potential Rate of Return: I am targeting breakeven for this position
C Jun Week One (6/3) 51 Put
Current Stock Price: $51.86
Net Debit: $15.72
Action:
- Buy to close the C Jun Week One (6/3) 51 Put for around $0.22
- Sell to open the C Jun Monthly (6/17) 50 Put for around $0.80
- Set your initial credit limit at $0.58, but adjust as needed to roll today
New Net Debit: $15.14
Expiration: After the close on Friday, June 17
Potential Rate of Return: I am targeting breakeven for this position