I am recommending we close our Charles Schwab (SCHW) put at breakeven.
We entered this position in April 2022, when the S&P 500 was around 4,462. The broader market index is down 16% since then.
When the market turned against us, we were assigned shares. SCHW hit a low of $59.35 on June 13. At the time, our cost basis was $71.95, meaning we had a paper loss of 17.5%.
But we continued to sell options aggressively, and with last week’s roll, we flipped our net debit to cash in hand. Now we have a chance to exit the trade ahead of the company’s earnings announcement.
Let’s do it and consider the preservation of our capital a win during what was a very tough period for the market.
Current Stock Price: $76.15
Cash in Hand: $0.26
Action: Buy to close the SCHW Oct Week Two (10/14) 70 Put
Current Option Price: $0.21-$0.30
Recommended Limit: Set your initial limit order at $0.26, but adjust as needed to close today
Profit: $0, or $0 per contract
Rate of Return: 0% in 171 days, or 0% on an annualized basis