Learn How We Made $771 CASH in One Week
November 6th, 2020
The market stalled on Friday, though, despite the October jobs report showing hiring picking up at a faster pace than expected. The unemployment rate was also much better than expected, coming in at 6.9% versus the forecasted 7.7%.
At Options Income Blueprint, we booked three more winning put trades this week:
Traders who sold just one contract of each of these trades could have earned a potential $257 in income.
We entered the position back in mid-February when stocks were happily chugging along to new highs. We had successfully traded the semiconductor stock multiple times before, and I was looking forward to another fast winner.
But then the bottom fell out from under us and the market crashed. MU shares cratered almost 50% in a month.
We rolled the put a few times to buy ourselves time before accepting shares in mid-March at $58. The stock closed at $42.99 that day and bottomed out the following week just above $31.
Rather than cut and run, taking a gigantic loss, I encouraged members to stay the course. The stock was grossly undervalued, and we are in the midst of a consumer tech supercycle in which new-and-improved chips beget new-and-improved devices, which spark demand for even better chips, and so on and so forth.
Over the ensuing months, we sold calls and rolled them. The stock shot up and we were eventually called out of our shares, incurring a net debit. We then sold puts and rolled them, chipping away at that net debit along the way.
In August, we were once again assigned shares. We sold a call against them and had been rolling since.
We were finally called away with a profit on Friday after almost nine months in the position. It was a tiny one, to be sure, but that is not my point.
My point is that we avoided a massive loss. It was a slog, but I’m happy we walked away knowing we stuck with our rolling strategy and it worked.
Unless the underlying story of a stock changes, I refuse to walk away with a loss. The vast majority of time, this patience is rewarded.