Lyft (LYFT) continues to bounce around but premiums remain high. I am recommending we roll our put out two weeks to avoid assignment and reduce our net debit on the position.
Charles Schwab (SCHW) has run up over the past week and our call is in the money. Rather than allow our shares to be called away, I am recommending we roll out two weeks and to a higher strike. While we will spend some cash to do so, we will capture another $2.50 in potential appreciation in the shares.
Note that these trades are only for members who are already in the positions.
LYFT Jun Week One (6/3) 20 Put
Current Stock Price: $17.79
Net Debit: $1.71
Action:
- Buy to close the LYFT Jun Week One (6/3) 20 Put for around $2.25
- Sell to open the LYFT Jun Monthly (6/17) 20 Put for around $2.51
- Set your initial credit limit at $0.26, but adjust as needed to roll today
New Net Debit: $1.45
Expiration: After the close on Friday, June 17
Potential Rate of Return: I am targeting breakeven for this position
SCHW Jun Week One (6/3) 67.50 Call
Current Stock Price: $70.03
Cost Basis: $71.51
Action:
- Buy to close the SCHW Jun Week One (6/3) 67.50 Call for around $2.51
- Sell to open the SCHW Jun Monthly (6/17) 70 Call for around $2.07
- Set your initial debit limit at $0.44, but adjust as needed to roll today
New Net Debit: $71.95
Expiration: After the close on Friday, June 17
Potential Rate of Return: I am targeting breakeven for this position