I am recommending we roll our General Motors (GM) and Charles Schwab (SCHW) puts out one week to generate more income and reduce our net debits on the positions.
You can enter the second leg of today’s GM trade even if you were not in the previous one. Just be aware that we will be managing and tracking it based on the ongoing position.
If you are not currently in the SCHW trade, please do not enter it now.
GM Sep Week Two (9/9) 37 Put
Current Stock Price: $39.83
Net Debit: $10.62
Action:
- Buy to close the GM Sep Week Two (9/9) 37 Put for around $0.05
- Sell to open the GM Sep Monthly (9/16) 39 Put for around $0.74
- Set your initial credit limit at $0.69, but adjust as needed to roll today
New Net Debit: $9.93
Expiration: After the close on Friday, Sept. 16
Potential Rate of Return: I am targeting breakeven for this position
SCHW Sep Week Two (9/9) 70 Put
Current Stock Price: $72.01
Net Debit: $2.32
Action:
- Buy to close the SCHW Sep Week Two (9/9) 70 Put for around $0.20
- Sell to open the SCHW Sep Monthly (9/16) 70 Put for around $0.80
- Set your initial credit limit at $0.60, but adjust as needed to roll today
New Net Debit: $1.72
Expiration: After the close on Friday, Sept. 16
Potential Rate of Return: I am targeting breakeven for this position