I am recommending we roll our Citigroup (C), General Motors (GM) and Marvell Technology (MRVL) positions out two weeks.
The market continues to bounce around, and rolling out to March 4 allows us to capture more premium in these core stocks. Note that Marvell is scheduled to report earnings on March 3. We will be closing the position before then and reopening it after the announcement if necessary.
C Feb Monthly (2/18) 67 Put
Current Stock Price: $65.41
Net Debit: $2.85
Action:
- Buy to close the C Feb Monthly (2/18) 67 Put for around $1.64
- Sell to open the C Mar Week One (3/4) 67 Put for around $2.42
- Set your initial credit limit at $0.78, but adjust as needed to roll today
New Net Debit: $2.07
Expiration: After the close on Friday, March 4
Potential Rate of Return: I am targeting breakeven for this position
GM Feb Monthly (2/18) 50 Call
Current Stock Price: $49.19
Cost Basis: $55.21
Action:
- Buy to close the GM Feb Monthly (2/18) 50 Call for around $0.23
- Sell to open the GM Mar Week One (3/4) 50 Call for around $1.27
- Set your initial credit limit at $1.04, but adjust as needed to roll today
New Cost Basis: $54.17
Expiration: After the close on Friday, March 4
Potential Rate of Return: I am targeting breakeven for this position
MRVL Feb Monthly (2/18) 67.50 Put
Current Stock Price: $69.63
Cash in Hand: $0.45
Action:
- Buy to close the MRVL Feb Monthly (2/18) 67.50 Put for around $0.71
- Sell to open the MRVL Mar Week One (3/4) 67.50 Put for around $4.02
- Set your initial credit limit at $3.31, but adjust as needed to roll today
New Cash in Hand: $3.76
Expiration: After the close on Friday, March 4
Potential Rate of Return: 5.6% in 18 days, or 113% annualized, if this option expires worthless