Today we have entered into a new 1×2 put spread in UBER. If the stock goes higher then we make a smaller profit. If the stock goes lower, we can make much more. This has the “risk” of owning 100 shares. However, if that happens then it will be at a much lower cost basis. Details below:
Buy to open: UBER Aug 21st (monthly) 70.00 strike put (ratio of 1)
Sell to open: UBER Aug 21st (monthly) 65.00 strike put (ratio of 2)
Credit: 0.50
If the stock is above 70/share at Aug expiration = 0.50 or $50.00 of profit
Max reward = 5.50 or $550.00 per spread traded
Max risk = owning 100 shares at a cost basis of 59.50/share (losses occur below that share price)
In addition, we recently got “put” 100 shares of NKE stock from a short put position. We have sold a covered call against those shares today as follows:
Sell to open: NKE June 18th 47.50 strike call
Credit: 0.32