We have positions in Bank of America (BAC) and iShares Global Clean Energy ETF (ICLN) expiring today.
I am recommending we roll our BAC put out one week and to a higher strike. I believe we will see bank stocks continue to move up following the positive results from the Federal Reserve’s latest stress test.
Our ICLN call is in the money and our shares are on track to be called away at a loss. I am recommending we accept the loss rather than roll the position. Too many of the fund’s holdings are trading poorly despite progress on infrastructure negotiations.
BAC Jun Week Four (6/25) 43 Put
Current Stock Price: $41.41
Cash in Hand: $0.60
- Buy to close the BAC Jun Week Four (6/25) 43 Put for around $1.60
- Sell to open the BAC Jul Week One (7/2) 43.50 Put for around $2.16
- Set initial credit limit at $0.56, but adjust as needed to roll today
New Cash in Hand: $1.16
Expiration: After the close on Friday, July 2
Potential Rate of Return: 2.7% in 25 days, or 39% annualized, if this option expires worthless
ICLN Jun Week Four (6/25) 22.50 Call
Current Stock Price: $23.13
Cost Basis: $23.13
Action: Allow shares to be called away
Loss: $0.63, or $63 per 100 shares