This is the first of several different alerts over the next 24 hours to manage our 25 Nov positions before the Thanksgiving holiday.
Camping World Holdings (CWH): 27.45
Camping World stock price is bouncing back. Looking ahead into December, the stock goes ex-dividend on 12/13. CWH has been a solid income generator since we first added the position back in August. We can roll our calls out two weeks and then decide how to manage the ex-dividend date.
TRADE ACTION: Roll CWH 25 Nov 28 call to the 9 Dec 28.50 call for a net credit of around 0.50 to 0.55 and a 1.7% return.
Buy to close CWH 25 Nov 28 call
Sell to open CWH 9 Dec 28.50 call
Dow Inc. (DOW): 51.43
There are two issues with managing our Dow position.
First, Dow goes ex-dividend next Tuesday (11/29) and we can’t roll our 25 Nov 51 call out and up enough to collect a credit and avoid getting called out of the stock. We will NOT roll our 25 Nov 51 call out. With two trading days left in this week it’s possible the stock price may trade down below our call strike and we avoid assignment. If the stock trades higher, then we get called out and buy it back next Monday ahead of the ex-dividend date.
Two, there is still the potential for a rail strike next month that would likely hit all chemical companies including DOW. A tentative settlement has been reached but not yet approved by all of the unions. We will know more in the next week or so. In the meantime, if we get called out this Friday, we can buy the stock back on Monday (11/28) and sell a 2 Dec at the money call to potentially get called out again ahead of a potential strike. Stay tuned.
ACTION: NO ACTION.
Kraft Heinz (KHC): 38.75
We were called out of our Kraft Heinz stock over the weekend. KHC goes ex-dividend tomorrow (11/23) so buy the stock and sell a covered call today.
ACTION: Buy/Write KHC stock and sell to open the KHC 9 Dec 39.50 call for a net debit of 38.52
Buy KHC stock at around 38.79
Sell to open KHC 9 Dec 39.50 call for a net credit of around 0.27
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