So I looked at this... rolling my Jan 23 $550s to Jan 24 $750s for example nets me about $55 a share credit... plus "saving" me the ~53/share cost of rolling to Jan 24 550.... so I net about $108 a share, for a $200/share strike bump, compared to rolling a year out on the same strike, though only about half that is "new" cash
So in theory for say every 10 of these one rolled they could get 11 of the 750s a year further out at about even cost.... though somewhere in my brain taking $108 for a $200 strike increase DITM seems...not great?
Ran some examples through options calc trying to get my brain working...
Running this through the options calculator, and looking where I'd be when I was once again about a year from expiration (so Jan 2023) and looking at a few stock prices, I get:
Pay ~$53 share to keep the 550 strike out another year, keep it at 10 contracts:
Stock at $1100 I lose ~$47,500 total (about 100k including the 53k I had to add)
Stock at $1300 I make about $158,000 total (about 105k including costs)
Stock at $1500 I make about $320,000 total (267k w/costs)
Stock at $1800 I make about $640,000 total (587k w/costs)
Or roll it 11 Jan 2024 $750s:
Stock at $1100 I lose ~$85,000
Stock at $1300 I make about $100,000
Stock at $1500 I make about $300,000
Stock at $1800 I make about $610,000
Plus in theory I make some non-zero amount on selling 1 extra CC.
But I think adding the 53k to my losses isn't accurate math...because a roll isn't really a roll it's a sell and buy- so I should only care about what I paid for the buy....
In which case the $550s seem to win at every price I tested even with there being one less of them... since I'm probably not gonna make 20k in a year selling one extra CC and at most SPs the gap is even bigger than 20k.
Or am I thinking about this all wrong?