I am recommending we roll our Sunrun (RUN) and Sonos (SONO) puts.
RUN has seen some big swings in recent days. We are rolling out to avoid potential assignment and bring in more income. Since RUN only has monthly options, we are going out to the October monthly expiration.
SONO, on the other hand, has weekly options, but I am recommending we go for a larger chunk of cash by rolling out two weeks.
RUN Sep Monthly (9/17) 45 Put
Current Stock Price: $43.86
Cash in Hand: $1.25
Action:
- Buy to close the RUN Sep Monthly (9/17) 45 Put for around $1.68
- Sell to open the RUN Oct Monthly (10/15) 45 Put for around $3.65
- Set initial credit limit at $1.97, but adjust as needed to roll today
New Cash in Hand: $3.22
Expiration: After the close on Friday, Oct. 15
Potential Rate of Return: 7.2% in 38 days, or 69% annualized, if this option expires worthless
SONO Sep Monthly (9/17) 38 Put
Current Stock Price: $36.03
Cash in Hand: $0.60
Action:
- Buy to close the SONO Sep Monthly (9/17) 38 Put for around $1.99
- Sell to open the SONO Oct Week One (10/1) 38 Put for around $2.49
- Set initial credit limit at $0.50, but adjust as needed to roll today
New Cash in Hand: $1.10
Expiration: After the close on Friday, Oct. 1
Potential Rate of Return: 2.9% in 24 days, or 44% annualized, if this option expires worthless