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Trade adjustment – AT&T (T) put selling roll over

Today I decided to roll over my existing put selling trade against AT&T (T). I had a trade which was expiring next month:

-1 April 18, 2014 34 strike put

As the stock continued drifting lower and it hit $32 a share this morning, and continued lower, I decided to roll this trade to a lower strike, further away in time, and still collected more in premiums.

Here is a trade detail:

Diagonal: BTC +1 April 18, 2014 34 put @ 2.58 / STO -1 October 18, 2014 33 put @ 3.01 net CREDIT 0.43

I couldn’t lower my strike to $32 without selling two contracts instead of one, for which I didn’t have enough maintenance cash to cover the trade.

So, I lowered it only to $33 a share and as time will go on, there will be two outcomes:

  • The stock recovers before October expiration and the option expires worthless or I will buy it back if it has no value.
  • The stock will continue drifting down or stays below 33 dollars a share and I will roll over again to 32 strike price and further in time.


At this time I bought a plenty of time so I do not have to do anything.

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