I am recommending we roll our Bank of America (BAC) and Citigroup (C) puts out one week and to higher strike prices. The income we generate will reduce our net debit on the positions.
However, 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 Jul Week Four (7/22) 32 Put
Current Stock Price: $33.29
Net Debit: $10.02
Action:
- Buy to close the BAC Jul Week Four (7/22) 32 Put for around $0.08
- Sell to open the BAC Jul Week Five (7/29) 32.50 Put for around $0.41
- Set your initial credit limit at $0.33, but adjust as needed to roll today
New Net Debit: $9.69
Expiration: After the close on Friday, July 29
Potential Rate of Return: I am targeting breakeven for this position
C Jul Week Four (7/22) 49 Put
Current Stock Price: $52.04
Net Debit: $16.50
Action:
- Buy to close the C Jul Week Four (7/22) 49 Put for around $0.06
- Sell to open the C Jul Week Five (7/29) 50 Put for around $0.60
- Set your initial credit limit at $0.54, but adjust as needed to roll today
New Net Debit: $15.96
Expiration: After the close on Friday, July 29
Potential Rate of Return: I am targeting breakeven for this position