Added 230 cc for next week around 2.50. While I do think something of a move up from here is possible, I don't see it as being sustained or as likely, and will come back sooner than later.
Also went looking for 165/195 put spreads and have missed my limit price (1.60) so far. My plan of the moment is to let those orders ride for the day and see if they fill. I'll go looking again tomorrow (I won't be surprised if we open down tomorrow, and I get an even better open then).
I have 275 strike csp for Jan and Feb monthly expirations that I've wanted to start curing. I was initially thinking about a roll into put spreads (which is what got me thinking about returning to put spreads). That thinking has evolved though, and I plan to separate the two events (close DITM csp; open BPS that pays for it).
By separating the two events, I don't size the BPS or choose the strikes based on closing the csp, nor do I close the csp when the price is right for opening the BPS. Instead I'll open BPS I consider appropriate (timing, strike, premium; generally lower share price / down days) and when I close the BPS / realize the BPS gain, I will also decide on the spot how many CSP to close using those gains (generally higher share price / up days).
I'll be closing cps using realized gains from the BPS closes (rather than credits on open). I will also tend to close the CSP at a relatively good price as the shares will tend to be up from when the BPS was opened (or at least flattish as time decay ate up their value).
It will also be easy to do things like opening qty 50 $30 wide spreads and later close 1 csp, rather than trying to open 9 put spreads of the best available strike while closing 1 275 strike csp. Or do 2x, or whatever multiple - I'll just disconnect the two events and focus only on the total credit / debit, so that the combination of the realized results is positive.
These initial positions are only big enough to close 1 csp with a bit of profit left over for income, but its a start, and each csp will release cash backing I can use for larger BPS positions should I make that decision. Each csp is good for 9 $30 wide bps.
not-advice (really, really not-advice)
Part of my motivation for looking at BPS again is that with the share price at such a relatively low level ($650 pre-split $$) is that there just isn't all that far down to go. As a result I see an opportunity, especially if the share price languishes in this low $200 range, to earn at a high rate. Makes me wish I didn't have those 275 csp, but this does provide a path to continuing income while buying out those csp.
Part of my thinking here is last summer, and in particular August. Last August (2021) is comfortably my best single month, and was characterized by relatively close to the money BPS while the share price was relatively low (not much further down to go). At that time I made heavy use of the 700 and then 730 price levels as supports (233 and 243 in current money) by being $30 to $50 OTM (<$20 in today's money) using very large positions.
I see a similar setup right now. Even if the share price moves down to 180 (540 pre-split) I really don't see a lot further down from there, especially if I'm another $20 OTM anyway (ideally 130/160 BPS in that instance). I see risk / reward strongly in my favor, in a way that I wouldn't see if share price were $400 right now.
Should those 165/195 put spreads hit then I'll have put spreads opening for 5% of the spread width (capital at risk) with a short strike of $585 in pre-split money. If close these for .50 (2/3rds profit) then I'll have earned a bit more than 3% on capital at risk - that's a rate I'll take every day and 3 times on Sunday.
And manage aggressively for minimum risk. As always that'll mean early recognition of winnings - it will also mean rolling early if we approach the short strike, rather than trying to wait something out, and rolling for maximum strike gain - which works best if you start already OTM). Heck - earnings on a single position can be so high that monthly earnings accumulate in a single week.
