I am recommending we roll our Marvell Technology Group (MRVL) put out one week and to a higher strike to generate more income.
Let’s also roll our Micron Technology (MU) call. With the company expected to announce earnings next week, we are going with a strike that is well out of the money and will result in a small profit if our shares are called away.
MRVL Jun Week Four (6/25) 54 Put
Current Stock Price: $55.67
Net Debit: $3.95
Action:
- Buy to close the MRVL Jun Week Four (6/25) 54 Put for around $0.06
- Sell to open the MRVL Jul Week One (7/2) 55 Put for around $0.65
- Set your initial credit limit at $0.59, but adjust as needed to roll today
New Net Debit: $3.36
Expiration: After the close on Friday, July 2
Potential Rate of Return: I am targeting breakeven for this position
MU Jun Week Four (6/25) 80 Call
Current Stock Price: $80.48
Cost Basis: $84.57
Action:
- Buy to close the MU Jun Week Four (6/25) 80 Call for around $0.89
- Sell to open the MU Jul Week One (7/2) 84.50 Call for around $1.06
- Set your initial credit limit at $0.17, but adjust as needed to roll today
New Cost Basis: $84.40
Expiration: After the close on Friday, July 2
Potential Rate of Return: 0.1% in 107 days, or 0.4% annualized, if shares are called away