Walt Disney (DIS) is scheduled to announce earnings tomorrow, and we currently own a DIS Jan 2021 (1/15/21) 100 Call.
I am recommending we sell a call against this LEAP to generate cash while at the same time buying a put option to protect against a potential downside move following the announcement.
Current Stock Price: $131.26
Cost Basis: $36.84
- Sell to open the DIS Nov Monthly (11/15) 135 Call for around $1.80
- Buy to open the DIS Nov Week Two (11/8) 128 Put for around $1.20
- Set your initial credit limit at $0.60, but adjust as needed
New Cost Basis: $36.24