|slw roll analysis|
after this positive experience with slw i have also decided that a business this good should be expanded. to that end, i bought three jan14 puts at the $15 strike for 50 cents and sold 2 more july puts at the $22 strike. the effect of this is to convert my cash covered put trade into a wide diagonal. the $15 strike was chosen because that is about 2/3 of 22 and this keeps the buying power allocated to this trade level with the initial position. there are 6 monthly rolls between july and and january with which to amortize the 50 cents paid for the $15 strike puts which adds 9 cents to the cost of rolling for a total of 12 cents of manufacturing cost for these monthly calendars.