Rolling sell put csp contracts for mrk.

Alot of times you would hear people say, roll down (csp) or roll up (covered call) their option contracts. Basically rolling your contract is cancel the first contract (cut loss) and open a new second contract. But the second contract must cover the loss of the first contract or minimum must break even or take a small loss.

On oct 10/24, open 2 x mrk contracts at 109.29c, strike at 105 and premium of 192 x 2 (35 dte). On nov 5/24, i closed 2 x contracts at 101.35c, buy back at 410 x 2 to close contracts and incurred loss of 439. On nov 5/24 (same day), open 2 contracts strike at 100 (44 dte), premium 275 x 2. On dec 9/24 yesterday, buy to close at 55 x 2 and profit of 437. The overall process incurred a 2 usd loss, at times you can't expect to be right all the time. Rolling down contract is a must learn process in all option trading especially when you are selling credits (premium), no roll, no profit. But if trade do go against me upon expiry after rolling, I'm fine with that because I have reduced my assignment price from 105 to 100. Do understand, assignment risk is unavoidable, it is part of the process. The main thing is, always choose a fundamental AAA stock to do your csp sell put. You also don't mind owning 100 shares if you do get assign.

😊 option trading