I am recommending we roll our General Motors (GM) and Charles Schwab (SCHW) puts to higher strike prices to generate more income and reduce our net debits on the positions. Note that we are rolling both positions out to the Sept. 9 expiration.
You can enter the second leg of today’s trades even if you were not in the previous ones. Just be aware that we will be managing and tracking them based on the ongoing positions.
GM Sep Week One (9/2) 36 Put
Current Stock Price: $39.16
Net Debit: $10.99
Action:
- Buy to close the GM Sep Week One (9/2) 36 Put for around $0.25
- Sell to open the GM Sep Week Two (9/9) 37 Put for around $0.62
- Set your initial credit limit at $0.37, but adjust as needed to roll today
New Net Debit: $10.62
Expiration: After the close on Friday, Sept. 9
Potential Rate of Return: I am targeting breakeven for this position
SCHW Aug Week Four (8/26) 68 Put
Current Stock Price: $72.79
Net Debit: $3.25
Action:
- Buy to close the SCHW Aug Week Four (8/26) 68 Put for around $0.08
- Sell to open the SCHW Sep Week Two (9/9) 70 Put for around $1.01
- Set your initial credit limit at $0.93, but adjust as needed to roll today
New Net Debit: $2.32
Expiration: After the close on Friday, Sept. 9
Potential Rate of Return: I am targeting breakeven for this position