SPWR/Rookie – Let's start with the assumption that buying 1,500 shares for $15.45 is perfectly acceptable:

• Sell 10 SPWR 2024 $22 puts for $9.25 ($9,250)
• Buy 20 SPWR 2024 $13 calls for $7.10 ($14,200) 
• Sell 15 SPWR 2024 $20 calls for $4.60 ($11,500) 

That's a net $6,550 credit on the $14,000 spread so net $20,550 (313%) at $22+ is nice enough but, while you wait, you can sell 5 or 10 short-term calls along the way.  March $19 calls are 0.85 using 45 out of 717 days and selling just 5 of them is $425 so 10 sales like that (450 days) is $4,250 more in your pocket.  So the worst-case scenario is you own 1,000 shares for $15.45 ($15,450) and your upside potential is to sell 10 short calls when it's up in the channel and make maybe $10,000 more along the way – what's not to like?  

Of course, I said the same thing on Nov 3rd on SPWR for our Top Trade Alerts but it is with no shame that I pick them again at half the price!  

At the time I said:

The leg I would add since the MTP is up 107% and has $167,589 out of $207,249 in cash is as follows:

• Sell 10 SPWR 2024 $25 puts for $6.25 ($6,250) 
• Buy 25 SPWR 2024 $30 calls for $12 ($30,000)
• Sell 25 SPWR 2024 $40 calls for $9.25 ($23,125) 

That's net $625 on the $25,000 spread so $24,375 (3,900%) upside potential at $40 and our worst case is owning 1,000 shares at $25.625/share, which is 22% below the current price.  When you REALLY want the worst-case to happen – it's a good spread!  This is too good not to take so let's put it in the Earnings Portfolio!    

Why so aggressive on this one (usually we go a bit more in the money)?  Because I like the no-cost trade ahead of earnings and it will be cheap to roll the long calls lower (the $25s are now $14.50, the $20s are $16.75) so we're just keeping the money on the side for a rainy day.  If SPWR pops, we'll just have to be content making 3,900% in two years.  

So here we are, 3 months later and we still like the $25 target for the puts so the adjustment here would be to close the 2024 $30 calls (now $2.50, $6,250) and the 2024 $40 calls (now $1.50, $3,750) for net $2,500 so, overall, we still have a net $1,875 credit on the overall trade which we can apply to the following:

• Buy 40 SPWR 2024 $13 calls for $7.10 ($28,400) 
• Sell 30 SPWR 2024 $20 calls for $4.60 ($23,000) 

So now we're spending $5,400 less the $1,875 credit is now net $3,125 on the $28,000 spread.  The puts are a bit higher than we'd like but, overall, not a bad adjustment on a stock that dropped 50% since we bought it.  That's because we were initially CONSERVATIVE with our $10 spread and it prevented us from taking too much damage.  The aggressive put sale is coming back to bite us but we still believe in the 2-year target and, if not, RAWHIDE!  The same short call selling strategy as above would apply, we look to sell 10 short puts when we can and 20 if we think SPWR is near the top of the channel.