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October Options Expiry – Rolling and Waiting (EXPO, TGT, TXT, FCN, UPS, KFY, XLF, KTB, BG, DE)

Posted on October 15, 2021

We lead with our EXPO trade, the details of which can be found HERE.

In brief, we’re short one lot of EXPO shares with a breakeven of $112.19 and our protective 125 CALL option expiring this afternoon.

With EXPO now trading at $112.60 – and not having participated in yesterday’s buying forgery – we say the downside tumble here is imminent.

We’re recommending you repurchase an insurance policy (in the form of a near-term CALL) so that nothing cataclysmic enter the loss ledger.

Buy the EXPO November 19th 115 CALL for $5.00 and wait.  Our breakeven thereby drops to $107.60.

Target in The Crosshairs; Meat For Dinner was our July 4th issuance, and it urged you to purchase the TGT October 15th 230/210 PUT spread for a debit of $3.87.

The trade is still a good one, as TGT stock is about as solid as a LEGO construct.

So how to deal with today’s expiry?  And the $3.87 loss it appears we’re about to take?

We’re recommending you sell the TGT November 19th 230/240 CALL spread for a credit of $6.05 (15.15/9.10) and buy the November 19th 230 PUT for $4.00.

That will reduce our debit to $1.87 and leave us open to profit on the downside.

NEXT!

Our TXT trade’s details can be procured HERE and summed thus –

We’ve got a $2.46 debit and are holding a short 65/70 CALL spread that expires this eve.

With price at $73.17, we’re acting as follows –

We’re shorting one lot of stock and buying a protective November 19th 80 CALL for $0.70.

Our breakeven for the trade (and current credit) now sits at $70.01.

Mere spittin’ distance.

The particulars on our FCN venture are available HERE, and are as follows –

We have a debit of $0.92 and are short the 135/140 CALL spread expiring this eve.

That means we have to act.

Like this –

We’re setting the FCN December 17th 130 synthetic short (sell the CALL, buy the PUT) for a credit of $10.55 (13.00/2.45).  We’re also buying a protective December 17th 145 CALL for $6.20.

All told, our debit grows marginally to $1.57, but we maintain full downside exposure to an FCN decline.

And so we proceed.

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UPS is up next, and her details can be found HERE.

Bottom line is we’re short the shares with a $181.20 breakeven and our protective 195 CALL expires at today’s close.

No fooling around here.  We’re extending the trade with the purchase of another protective CALL.

BUT FIRST – sell the existing CALL for whatever you can get so the short position has no chance of closing, and –

Buy the UPS November 19th 200 CALL for $3.00 even.

Our breakeven thereby drops to $178.20.

Taking Aim

Details on our KFY initiative can be sourced HERE, and they break down as follows –

We’re short the shares with a $55.28 breakeven and are holding a protective 80 CALL that dies this eve.

With little chance the CALL will be triggered, we’re recommending you extend the trade by buying the KFY November 19th 80 CALL for $1.20.  That reduces our breakeven to $54.08 and gives us another month to fight.

Our XLF trade, whose details are available HERE, needs attention.

We’ve got a debit of $3.43 and are holding a short 36/39 CALL spread expiring this eve.

Exact numbers will only be available after the close, but it appears we’ll be sporting an enlarged debit of roughly $6.40 when the dust settles.

So we’re acting as follows –

We’re shorting the shares (now trading at $38.93) and buying a protective January 21st 41 CALL for $0.65.

That puts our breakeven on the trade at roughly $32.00 (again, final tallies will be calculated after the close).

—————————————————————

Moving on to our KTB bet, whose details are HERE, we’re now looking at a debt of $4.10, while holding the 35 synthetic short expiring this eve.

Which means we gotta move.

Buy back the short 35 CALL at the close (or upon any intraday weakness) for roughly $15.00, and sell two (2) KTB June 17th 40 CALLs for $12.00 each.

That will flip our debit to a credit of roughly $5.00 (full details to be known after the close).

Our BG trade has us holding two short 60 PUTs expiring tonight and a credit of $7.05.

Action required: buy back the PUTs at the close (or on any intraday weakness) and sell two (2) January 21st 57.50 PUTs for $26.30 each.

Depending upon closing numbers, we’ll likely see our credit grow to roughly $9.00.

Exact, updated figures next week.

Onward, HO!

Name calling doesn’t help.

Our Deere trade sees us in possession of two 315 CALLs and a credit in-hand of $15.70.

With the company’s workers voting to strike, we see weakness ahead.

So we’re acting thus –

Buy back the two short CALLs at the close (or on weakness) and sell two (2) November 19th 320 CALLs for $15.95 each.

That buys us a month and ups our existing credit to roughly $17.50 (full accounting available after the close).

And there we leave it.

Free choice is in our hands.

The G-d of Israel has decreed it.

.הכל בידי שמיים… חוץ מיראת שמיים

Everything is in the hands of Heaven, except for fear of Heaven.

Find it.

Eschatologically yours,

Alan B. Harvard

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