I just sold a 10 contract $14.00 Put on Snap (SNAP) for a premium of 65¢ ($650). SNAP’s earnings are coming out after the ball today but I listening to some good reports. If the stock goes up I keep the premium. The stock is at $15.20 and it will be put to me at $14.00 if it goes down below my Strike Price.
Sell to Open 10 SNAP 11/11/17 $14.00 P @ 65¢ (+$650)
Since earnings are coming out today I give this trade a Risk Factor 3.
Steve
The Options Coach
Steve, did you buy the stock in order to sell the put.
No Del, I just sold a $14 Put. The earnings were bad and the stock dropped below my Strike Price. If it stays below $14 I’ll have the stock put (sold) to me at $14. I hope in the next few days it gets above $14. Today in after hours it went down to $12.53. I hope it doesn’t keep dropping tomorrow. Let’s watch and see.
How are you going to turn this trade around, since I did not see you get out of the trade.
When I sold this Put the stock was at $15.20. I could have made this trade with a Strike Price of $15 or $14.50 for a bigger premium. However, I picked a lower Strike Price ($14) with a lower premium. I picked a Strike Price I felt comfortable owning the stock at. As a result of my Put I now own the stock at $14. As of the latest reported period, the photo and video sharing app had 178 million daily active users worldwide, up from 153 million global daily active users in the corresponding quarter of the previous year. 4 days after earnings the stock is now at $12.76, up 38 cents on Friday. I believe the stock will be back above $14 soon. If not, at some point I’ll have to bail out with a loss on the stock. Maybe doing so while selling Calls. This will being is some premiums to add to my Put premium to make up for the stock loss. Let’s hope that don’t happen and the stock just goes up.