Roll forward and down 1 Credit Spread on PLTR – 0.37% potential income return in 45 days

On March 23, 2021, we bought back 1 bull put credit spread options on PLTR stock and additionally sold 1 new bull put credit spreads with lower strikes prices and expiry further out (roll forward and down). The aftermath of this trade $8.6(after commissions)

Originally we opened this trade on March 16: Sold Credit Spread on PLTR – 2.36 % potential income return in 10 days as our strike prices we challenged we decided to roll forward and down.

These trades come as the #154 and #155 in the month of March, according to our trading plan for this month, the premium generated from this trade makes us about 4.91% from our $2,000 monthly goal.  While in total we have reached already 297.99% so far. Awesome.

Here is our trade setup:

  • SLD    1    PLTR    MAR 26 '21 - 25.5 + 23.5 Put Bull Spread    -1.45    USD 
  • BOT    1    PLTR    APR 30 '21 - 23 + 20 Put Bull Spread    -1.03    USD 

The aftermath for this trade, we got a total premium of $8.6 (after commissions) or 0.37% potential income return in 45 days (if options expire worthlessly).In other words, we bought some time and lowered our strike price from $25.5 to $23

What happens next?

On expiry date April 30, 2021 PLTR is trading above $23 per share -  options expire worthlessly and we keep premium - if PLTR trades under $23 on the expiry date, we get assigned.

But as we already have collected a premium of $0.08 per share, our break-even price for this trade then is $23-$0.08 = $22.92

Selling credit spreads with PLTR stock
Selling credit spreads with PLTR stock
  • Running Total  11 Trade since January 4, 2021
  • Options income $137