Editor’s note: Michael is hosting a Perpetual Income Portfolio Club Live Trading Session on Monday, Oct. 5, at 11 a.m. Eastern.
If you have not already done so, register here.
Once you have registered, you will receive email reminders from our webinar provider, Zoom, prior to the session with a link to join.
I am recommending we roll our in-the-money Chewy (CHWY) call to capture $2 more in potential appreciation.
If you are not currently in a CHWY position, please do not enter one at this time. I will alert you when it is time to initiate a position.
Current Stock Price: $56.43
Action:
- Buy to close the CHWY Oct Week One (10/2) 53 Call for around $3.45
- Sell to open the CHWY Oct Monthly (10/16) 55 Call for around $3.45
- Set your initial credit limit at $0, but adjust as needed to roll today
And here’s where we stand with our Perpetual Income Portfolio Club positions heading into the weekend.
AMAT Oct Week One (10/2) 58.50 Put
It would seem the federal government’s move to block shipments of certain technology products to Chinese chip foundry SMIC this week was already factored into stock prices. Applied Materials (AMAT) rose this week before selling off today, helped in part, I believe, by Micron Technology’s (MU) upbeat forecast.
Our put is on track to expire worthless and we will sell another one next week.
Current Stock Price: $58.95
Action: Watch put expire worthless
GILD Oct Week One (10/2) 63.50 Call
Gilead Sciences (GILD) appears to have found support at $62, but the stock continues to trade sluggishly. However, in a cash-focused service, trading ranges are our friend. What’s more, the potential upside for this stock is far greater than the potential downside, and option premiums remain very large.
Our call is on track to expire worthless and we will sell another one next week.
Current Stock Price: $62.88
Action: Watch call expire worthless
TGT Oct Week One (10/2) 155 Put
Target (TGT) is running up with the rest of the pandemic growth stocks but has yet to hold above $160. Business is good and the brand is stronger than ever, so I see the potential for another big move higher, perhaps after earnings come out in mid-November.
Our put is on track to expire worthless and we will sell another one next week.
Current Stock Price: $159.85
Action: Watch put expire worthless
Disclosure: I have positions or trade in and out of AMAT, CHWY, GILD and TGT.