Today, with Apple trading around $432 CCI rolled the April 20 $480 call out to the May 3 $475 call for a $3.74/contract credit. The April call trade netted a $3.20/contract gain. As discussed last time, possible scenarios include:
- in the event that Apple goes down - oops. But this trade lowers the break even point by about 1%, and will provide the opportunity/time to continue this process to further to lower the cost basis.
- in the event that Apple surges over $475 by May - CCI would be "forced" to take the leveraged 30% profits in the position. Fyi, earnings on April 23 , so this type of surge is possible on good news. This position may need to be adjusted around the time of earnings.
- the stock continues trade in the same range as the last quarter - CCI will repeat this process to harvest more option premium.