I am recommending we roll our Bank of America (BAC) put to buy ourselves more time and bring in additional income.
Let’s also roll our iShares Global Clean Energy ETF (ICLN) and Micron Technology (MU) calls to reduce our cost basis on the positions as we continue to work our way toward breakeven.
BAC Jun Week Two (6/11) 43 Put
Current Stock Price: $42.06
Cash in Hand: $0.39
Action:
- Buy to close the BAC Jun Week Two (6/11) 43 Put for around $0.97
- Sell to open the BAC Jun Monthly (6/18) 43 Put for around $1.13
- Set your initial credit limit at $0.16, but adjust as needed to roll today
New Cash in Hand: $0.55
Expiration: After the close on Friday, June 18
Potential Rate of Return: 1.3% in 11 days, or 42% annualized, if this option expires worthless
ICLN Jun Week Two (6/11) 23 Call
Current Stock Price: $22.17
Cost Basis: $23.45
Action:
- Buy to close the ICLN Jun Week Two (6/11) 23 Call for around $0.03
- Sell to open the ICLN Jun Week Four (6/25) 22.50 Call for around $0.35
- Set your initial credit limit at $0.32, but adjust as needed to roll today
New Cost Basis: $23.13
Expiration: After the close on Friday, June 25
Potential Rate of Return: I am targeting breakeven for this position
MU Jun Week Two (6/11) 83 Call
Current Stock Price: $78.73
Cost Basis: $86.35
Action:
- Buy to close the MU Jun Week Two (6/11) 83 Call for around $0.04
- Sell to open the MU Jun Monthly (6/18) 80 Call for around $1.04
- Set your initial credit limit at $1, but adjust as needed to roll today
New Cost Basis: $85.35
Expiration: After the close on Friday, June 18
Potential Rate of Return: I am targeting breakeven for this position