With the market rallying today, I am recommending we book profits on our CVS Health (CVS) and Herman Miller (MLHR) positions. These closeouts will yield excellent rates of return and taking profits off the table is the smart play.
CVS Mar Week Two (3/12) 70 Call
Current Stock Price: $72.73
Cash in Hand: $68.20
Action:
- Buy to close the CVS Mar Week Two (3/12) 70 Call for around $2.80
- Sell shares at market
Profit: $1.73, or $173 per contract
Rate of Return: 2.5% in 15 days, or 60% on an annualized basis
MLHR Mar Monthly (3/19) 40 Put
Current Stock Price: $40.91
Cash in Hand: $2.45
Action: Buy to close the MLHR Mar Monthly (3/19) 40 Put
Current Option Price: $1.65-$1.90
Recommended Limit: Set your initial limit order at $1.78, but adjust as needed to close today
Profit: $0.67, or $67 per contract
Rate of Return: 1.7% in eight days, or 76% on an annualized basis