Rolling our WYNN puts to a lower strike price.
Shares of WYNN pulled back with the overall market weakness. The good news is that our income strategy gives us some buffer for when stocks pull back.
Today, we’re going to use our parachute protection plan to buy back our original WYNN put contracts at a higher price. This helps to reduce our risk and protect your investment capital.
At the same time, we’re going to be rolling out a new put play on WYNN using a lower strike price. This creates more of a buffer helping to protect your wealth while giving us more income from this stock.
We’re buying back our original WYNN put contracts at a loss. But if our second put position expires, we’ll still be able to walk away from this trade with a profit despite the pullback for shares of WYNN. And once our February put contracts expire, we can also look for opportunities to collect more income from selling new WYNN put contracts.
- Buy (to close) our WYNN February 18th $85 put
- Sell (to open) one WYNN February 18th $80 put
- Limit: Net DEBIT of $3.10 or less
- The new position will represent roughly 8.1% of our model.
~~~~~~~~~ - 10:46 Executed
- Bot 1 WYNN Feb 18th $85 Put @ $7.84
- Sold 1 WYNN Feb 18th $80 Put @ $4.97
- Net Debit: $2.87
*NOTE: If you don’t have a position in WYNN, simply sell the NEW put contracts to enter the trade. I recommend a limit of $4.70 or more for selling the new put contract.
- Sell (to open) one WYNN February 18th $80 put
- Limit: $4.70 or more