I am recommending we ladder up our General Motors (GM) put by rolling to a higher strike. This will bring in more income and boost our potential rate of return.
Current Stock Price: $54.41
Cash in Hand: $0.99
Action:
- Buy to close the GM Feb Week One (2/5) 50 Put for around $0.03
- Sell to open the GM Feb Week One (2/5) 52.50 Put for around $0.23
- Set your initial credit limit at $0.20, but adjust as needed to roll today
New Cash in Hand: $1.19
Expiration: After the close on Friday, Feb. 5
Potential Rate of Return: 2.3% in 11 days, or 75% on an annualized basis, if this option expires worthless