Posted on July 21, 2023
If you’re not in the mood for some heat—
Okee Dokee, Smokey!
We start with our TJX trade of April 4th that was entitled Have You Ever Dreamed of a 24,900% Return?
There, we urged you to sell the TJX July 21st 80/82.50 CALL spread for $1.00 and buy the TJX July 21st 77.50/75 PUT spread for $1.01. Total debit was a penny.
The CALL spread will very likely close in-the-money this eve, so we’re forced to act.
We’re setting the TJX September 15th 82.50 synthetic short* for a credit of $3.14 (4.60/1.46).
That will flip our debit to a credit of $0.63 and give us participation in the coming downside.
Our VVV initiative of March 15th was called It’s the Valvoline 500 Crash-Up Derby, and it recommended you sell the VVV July 21st 30/35 CALL spread for $2.85 and buy three (3) VVV July 21st 30 PUTs for $0.95 each. Zero Premium was the outcome.
Here, too, we’re facing a CALL spread fully ITM, and that means…
We’re setting the VVV December 15th 35 synthetic short* for a credit of $2.45 (4.50/2.05).
That reduces our debit to $2.55 and gives us exposure to VVV’s decline.
Moving on to Someone Left the Cement Out in the Rain, our CX play of March 8th, you’ll recall that we short sold one lot of CX stock at $5.32 and used the proceeds to buy a protective CX July 21 CALL with a 6 strike for $0.35 and ten CX July 21st 5 PUTs at $0.35 each. Total credit was $1.47.
Today, with CX trading at $7.46, we favor selling the long CALL at the open for $1.50 and two (2) CX May 17th 5 CALLs for $2.60 each.
That will flip our debit to a credit of $8.17 and leave the short sale open for further profits.
Details of our TEX trade can be accessed HERE.
Essentially, we have a $2.10 credit and are holding one short TEX 55 CALL expiring at the close.
But TEX is holding at $61.91.
We recommend you buy back the CALL at the close (or on intraday weakness) and set the TEX December 15th 55 synthetic short* for a credit of $7.20 (10.40/3.20).
That will expand our existing credit to $2.40 and keep us alive to profit until year end.
We Juggle Apples was the title of our January 16th communique, in which we urged you sell the AAPL July 21st 155/160 CALL spread for $1.00 and buy the AAPL July 21st 115/110 PUT spread for $1.10. Total debit was $0.10.
As the options expire, we’re on the rack for the full loss of $5.10.
ACTION: we’re going to set the AAPL November 17th 190 synthetic short* for a credit of $5.70 (12.85/7.15).
That will put us back in the black by $0.60 and offer a full four months’ of downside to profit from.
We launched a UNG trade on December 15th in a missive called The Sagacious Recommend the Gaseous. It called for the purchase of the UNG July 21st 21/25 CALL spread for $1.55 and sale of the UNG July 21st 19/16 PUT spread for $1.21. Total debit was $0.34.
The PUT spread will close ITM, so we’re moving thus—
Sell three (3) UNG October 9 PUTs for $1.98 each.
That will flip our debit to a credit of $2.60 and give us three more months to profit.
Details of our BG trade can be found HERE.
To sum, we’ve got a credit in hand of $7.19 and are holding two short 55 CALLs expiring this eve.
As the CALLs will close ITM at day’s end, we recommend repurchasing them at the close (or on any intraday weakness) and selling two BG January 19th 55 CALLs for $49.80 each.
That will reduce our credit to $5.79 and give us another half year to pull profits from this one.
Alan B. Harvard