I am recommending we sell calls on our uncovered Marvell Technology (MRVL) and Pfizer (PFE) shares to generate income and reduce our cost basis on the positions.
You can enter today’s trades even if you were not in the previous positions. Just be sure to purchase 100 shares of the underlying stocks first for every call you plan to sell. Also, note that we will be managing and tracking the trades based on the original positions.
MRVL Uncovered Shares
Current Stock Price: $36.66
Cost Basis: $57.06
Action: Sell to open the MRVL Jan Week Two (1/13) 37.50 Call
Current Option Price: $0.66-$0.67
Recommended Limit: Set your initial limit order at $0.66, but adjust as needed to sell a call today
New Cost Basis: $56.40
Expiration: After the close on Friday, Jan. 13
Potential Rate of Return: I am targeting breakeven for this position
PFE Uncovered Shares
Current Stock Price: $48.14
Cost Basis: $60.53
Action: Sell to open the PFE Jan Week Two (1/13) 49 Call
Current Option Price: $0.25-$0.27
Recommended Limit: Set your initial limit order at $0.26, but adjust as needed to sell a call today
New Cost Basis: $60.27
Expiration: After the close on Friday, Jan. 13
Potential Rate of Return: I am targeting breakeven for this position