Monday, March 26, 2018

OPPS, I forgot about my $LMT bull put spread

2- Bull put spread on $LMT $145/$135 strikes 23MAR18: premium collected $251 on $2000 margin risk

After I opened $LMT bull put spread on Feb 26, 2018, $LMT fell below my strikes and flattered in between.  I didn't pay much attention to it but I knew I had to roll out my spread in order to save my spread.  That very Friday, I totally forgot about $LMT as I went to work for a few hours then took a couple hours off mid-morning to watch a free movie Wonder at the theaters.  By the time, I got back to work, my heart dropped a little bit as I realized that I didn't roll my spread!  

$LMT was actually trading below my long strike at $135.  Lo and behold, end of day, it closed just above $335 meaning my long strike is worthless and I got assigned my short puts for 200 shares @ $345.  

Today, I am on margin for $69k and I need to lower my margin basis.  I sold a couple of calls against $LMT to hopefully fund my financing cost and to get out of the stock at a profit eventually.

1- sold covered call on $LMT $347.50 strike 29MAR18: premium collected $190
1- sold covered call on $LMT $335.00 strike 20APR18: premium collected $217

I will keep on selling one weekly call, until it gets called away to reduce my margin load.  




1 comment:

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