The market sell-off following the Federal Reserve announcement has pushed our Bank of America (BAC), Corning (GLW) and YETI Holdings (YETI) puts into the money.
I am recommending we roll them out one week in anticipation of a rebound.
BAC Jun Monthly (6/18) 43 Put
Current Stock Price: $40.14
Cash in Hand: $0.55
Action:
- Buy to close the BAC Jun Monthly (6/18) 43 Put for around $2.87
- Sell to open the BAC Jun Week Four (6/25) 43 Put for around $2.92
- Set your initial credit limit at $0.05, but adjust as needed to roll today
New Cash in Hand: $0.60
Expiration: After the close on Friday, June 25
Potential Rate of Return: 1.4% in 18 days, or 28% annualized, if this option expires worthless
GLW Jun Monthly (6/18) 41 Put
Current Stock Price: $39.52
Cash in Hand: $0.37
Action:
- Buy to close the GLW Jun Monthly (6/18) 41 Put for around $1.40
- Sell to open the GLW Jun Week Four (6/25) 41 Put for around $1.57
- Set your initial credit limit at $0.17, but adjust as needed to roll today
New Cash in Hand: $0.54
Expiration: After the close on Friday, June 25
Potential Rate of Return: 1.3% in 11 days, or 44% annualized, if this option expires worthless
YETI Jun Monthly (6/18) 91 Put
Current Stock Price: $87.06
Cash in Hand: $0.85
Action:
- Buy to close the YETI Jun Monthly (6/18) 91 Put for around $3.90
- Sell to open the YETI Jun Week Four (6/25) 91 Put for around $4.50
- Set your initial credit limit at $0.60, but adjust as needed to roll today
New Cash in Hand: $1.45
Expiration: After the close on Friday, June 25
Potential Rate of Return: 1.6% in 11 days, or 53% annualized, if this option expires worthless