Happy Sunday!
The last couple of months have been a bit bumpy - not necessarily because of volatility in the overall market, but there have been pockets of stocks grinding sideways which have needed a roll - as you'll read about in today's update.
This week:
$89 profit in Best Buy (BBY)
$89 profit in BBY
In April I sold a cash-secured put in BBY at the $75 strike expiring on May 17 and got paid $74 in premium.
Unfortunately BBY dipped below $75, which means I could potentially get assigned 100 shares of BBY at $75 per share, for a total of $7,500.
While I do have the capital to take this assignment of shares, my preference is to:
a) delay this for as long as possible and
b) to get paid while doing it
So I rolled my position out from May 17 to Jun 21, and also down from $75 to $72.50. I did this for a credit of $50.
So not only did I lower my capital at risk from $7,500 to $7,250, I got paid $50, bringing my total premium to $124.
Thankfully a few weeks later, BBY did rally and I paid $35 to close the position.Â
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That leads to a realized profit of $89 ($124 total credit less $35 paid to close the position), or 72% of max profit.Â
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As always, you can get updates for all my trades (and weekly portfolio updates) within my public portfolio by joining my Bread Crumb subscription.
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It's $49/month so this one winning trade in BBY would have covered all costs (and more) for the month.Â
Closing thoughts
While it's still been a quiet period, I did place a new place in CAT this week, which I'm looking forward to sharing with you soon.
Have a good weekend!
This article is for educational purposes only. This is my own portfolio which is being managed according to my goals and risk tolerance. Your situation is likely different and you should do your own due diligence before investing in stocks or options.