While I am not holding a Live Trading Session today, I am recommending three new trades.
First, I am recommending a longer-term position on health care apparel maker Figs (FIGS). The stock sold off after a strong earnings report but appears to have stabilized. I am recommending we sell a December put.
Next, I want to go back to Squarespace (SQSP). The stock has broken out and premiums are high. You may need to work the order, as the spread between the bid and the ask is wide. Also, as with FIGS, this stock only has monthly options. So, if we need to roll, we will be going out to December.
Finally, Twitter (TWTR) looks to have found support following a post-earnings sell-off. I want to take advantage of the still-elevated premiums by selling a put that expires this week.
Please do not chase the trades by accepting less premium than the “go as low as” price recommended below. Work your limit orders but exercise patience and let the trades come to you.
Figs (FIGS)
Current Stock Price: $34.04
Action: Sell to open the FIGS Dec Monthly (12/17) 30 Put
Current Option Price: $0.95-$1.15
Recommended Limit: Set your initial limit order at $1.05. You can go as low as $0.85, but please don’t start there and always use limit orders.
Expiration: After the close on Friday, Dec. 17
Potential Rate of Return: 3.5% in 32 days, or 40% annualized, if this option expires worthless
Squarespace (SQSP)
Current Stock Price: $47.91
Action: Sell to open the SQSP Nov Monthly (11/19) 45 Put
Current Option Price: $0.20-$0.60
Recommended Limit: Set your initial limit order at $0.40. You can go as low as $0.35, but please don’t start there and always use limit orders.
Expiration: After the close on Friday, Nov. 19
Potential Rate of Return: 0.9% in four days, or 81% annualized, if this option expires worthless
Twitter (TWTR)
Current Stock Price: $52.06
Action: Sell to open the TWTR Nov Monthly (11/19) 51 Put
Current Option Price: $0.32-$0.35
Recommended Limit: Set your initial limit order at $0.33. You can go as low as $0.28, but please don’t start there and always use limit orders.
Expiration: After the close on Friday, Nov. 19
Potential Rate of Return: 0.6% in four days, or 59% annualized, if this option expires worthless