Pfizer (PFE) managed to poke its head above $57 this week but has since traded back down to the $55 level. Rather than accept shares, I am recommending we roll our put out two weeks to buy some more time for the stock to move higher.
If you are not currently in the PFE position but want to enter by selling the Jan. 28 put, you can do so. Just be aware that we will be tracking and managing the trade based on the ongoing position.
Current Stock Price: $55.01
Cash in Hand: $0
- Buy to close the PFE Jan Week Two (1/14) 58 Put for around $2.96
- Sell to open the PFE Jan Week Four (1/28) 58 Put for around $3.64
- Set your initial credit limit at $0.68, but adjust as needed to roll today
New Cash in Hand: $0.69
Expiration: After the close on Friday, Jan. 28
Potential Rate of Return: 1.2% in 165 days, or 3% annualized, if this option expires worthless