Our Apple (AAPL), Chewy (CHWY) and Twitter (TWTR) puts expired worthless last week.
The holiday-shortened week got off to a rough start following last week’s record highs. With trading volume likely to remain light this week, I am recommending we sell monthly puts on these three names today.
Note that no action is needed on our General Motors (GM) Jul Week Two (7/9) 60 Put at this time.
Current Stock Price: $143.65
Action: Sell to open the AAPL Jul Monthly (7/16) 140 Put
Current Option Price: $0.72-$0.73
Recommended Limit: Set your initial limit order at $0.72
Current Stock Price: $83.40
Action: Sell to open the CHWY Jul Monthly (7/16) 80 Put
Current Option Price: $1.02-$1.09
Recommended Limit: Set your initial limit order at $1.05
Current Stock Price: $69.45
Action: Sell to open the TWTR Jul Monthly (7/16) 67.50 Put
Current Option Price: $0.67-$0.69
Recommended Limit: Set your initial limit order at $0.68
Note: Option prices tend to move around more than stock prices, so the prices you see when you receive this alert may be different than what I am seeing now. The most frequent concern I hear from members is “missing the trade” — i.e., not getting the limit price I recommend within a few minutes of placing the order.
It is important to be patient with these trades. Begin with my recommended limit for each trade, and if you need to adjust it slightly in a few hours to get in, you can do so.
The Perpetual Income Engine strategy involves selling options every week, so while a few pennies can be important to your short-term return, getting the trade executed is more important over the long run. Use your judgment as to when to adjust the trade after you place your initial order, but give it some time before doing so.
Disclosure: I have positions or trade in and out of AAPL, CHWY, GM and TWTR.