Chewy (CHWY) and General Motors (GM) were hit hard this week, pushing our puts into the money. I believe the sell-off in these stocks will be short-lived and a rebound will ensue. Therefore, I am recommending we roll our puts to avoid assignment and buy ourselves some time.
Our Twitter (TWTR) put is also in the money, but I am recommending we spend some cash to close the put rather than roll or accept shares. The company is expected to report earnings next week and I do not want to hold a position through the announcement.
CHWY Jul Monthly (7/16) 80 Put
Current Stock Price: $77.12
Action:
- Buy to close the CHWY Jul Monthly (7/16) 80 Put for around $2.95
- Sell to open the CHWY Jul Week Four (7/23) 80 Put for around $3.70
- Set initial credit limit at $0.75, but adjust as needed to roll today
GM Jul Monthly (7/16) 60 Put
Current Stock Price: $55.89
Action:
- Buy to close the GM Jul Monthly (7/16) 60 Put for around $4.10
- Sell to open the GM Jul Week Four (7/23) 60 Put for around $4.15
- Set your initial credit limit at $0.05, but adjust as needed to roll today
TWTR Jul Monthly (7/16) 67.50 Put
Current Stock Price: $66.75
Action: Buy to close the TWTR Jul Monthly (7/16) 67.50 Put
Current Option Price: $0.74-$0.83
Recommended Limit: Set your initial limit order at $0.79, but adjust as needed to close the position today
And here’s where we stand with our other Perpetual Income Portfolio Club position heading into the weekend.
AAPL Jul Monthly (7/16) 140 Put
Apple’s (AAPL) runup appears to be slowing down and shares are having trouble cracking $150. Our put is on track to expire worthless, and we will sell another one next week. I plan to select a strike that is considerably out of the money in anticipation of a technical sell-off if the stock fails again to break $150.
Current Stock Price: $147.79
Action: Watch put expire worthless
Disclosure: I have positions or trade in and out of AAPL, CHWY, GM and TWTR.