- Sell to close May $240 calls
- Buy to open July $250 calls
I just filled the order $0.35 net credit. This roll is consistent with our basic strategy that we have been employing for several other stocks (GS, V, MEE and CRM). The reason to do this now is that I don't want to be long front month calls going into earnings. By converting to July/May $250 call calendar, I am reducing my exposure to Theta decay, while remaining bullish on further upside.
The plan remains the same. If the stock rips higher above $250, I will roll short May $250 calls to June $260 calls for more net credit. June month should be available after April expiration. If the stock doesn't go above $250 anytime soon, then I have two months to take advantage of Theta decay (May and June $250 calls).
I am leaving the hedge open as is for now. Once April expires worthless and earnings are out, depending on how the stock behaves, I will either just close the hedge or convert it into May 230/240 bull put spread.
Hope I haven't lost anyone on all these roll outs. Those readers who have been following this AAPL trade closely, we have made ridiculous amount of profits in last six weeks. The story is not over yet. There is more to come if you play your cards right.
Good luck!
