CRDO Trades PUTs and CALLs

You should be skeptical whenever someone suggests you can quickly earn $1,000. I understand your skepticism. In addition, you have to ask, “what is the risk” and/or “how much time will this really take?” Yes, there is some learning time, but everything worth doing requires some education and effort. Options trading requires education and a base level of assets in your brokerage or retirement account to get started. It is not, however, very difficult to understand or to do.

I started with selling a CRDO put option on January 27 with a strike price of $130. That means I needed to have $13,000 in my traditional IRA to cover this purchase. Many investors have $13K in cash available for options trading. If they don’t it is certainly not a hopeless task to save up $13K.

Before I entered the put option order, I looked at the QUANT ratings on Seeking Alpha. The green colors that indicate “BUY” or “STRONG BUY” were encouraging. SA Analysts currently rate CRDO as a Buy, Wall Street has the same opinion, and the QUANT rating is a Strong Buy. While none of these is a guarantee of success or profit, it is a good starting point.

What About Dividend Income?

Another data point I consider is dividends. One negative is that CRDO does not pay a dividend. In an ideal world I want to buy dividend growth stocks and ETFs. However, when buying an investment one can also earn synthetic dividends by trading covered call options or by selling cash covered put options. It is even more profitable if the stock trades weekly options. (CRDO is an information technology company.)

CRDO currently trades weekly options, so that increases the possibility of profits each week. Since January 27 of this year, I have earned $3,895 selling CRDO cash covered put options. What is needed to do this? Cash to cover buying the shares if the price drops to or below the contract price. Bear in mind that I still have $13,000 in the money market fund earning interest. So I am being paid for my cash and for trading PUT options.

Most of the profit from the original PUT option sale comes from rolling the option up and down from a high of $130 per share to a low of $90 per share. My most recent roll was to move the contract from $90 per share to $130 per share, which was how I entered this series of trades in January. Each trade took me just minutes when I was using Fidelity Active Trader Pro software. That software is being replaced by Trader+, so there is a learning curve.

What About CRDO Covered Call Options?

The first step in my journey was to buy 100 shares of CRDO (Credo Technology Group Holding Ltd) on March 26, 2026 in my ROTH IRA. That meant that I needed to have $9,950 of cash in my ROTH to invest, because the share price on that date was $99.50.

The share price for these shares closed on Friday at $119.59. Therefore, if I sold my shares I would make an immediate tax-free profit. But there is a way to earn more cash using covered call options.

Instead, I entered a covered call trade for a strike price of $126. This contract expires on April 17, so I don’t have to wait long to see if my shares will be called. (This is the ticker symbol for the covered call option: -CRDO260417C126). My willingness to sell my shares resulted in net income of $379.33. I wanted $3.80 per share, and that is what I received. So, the $380, less the Fidelity commission of 67 cents gave me income. I like to think of this as a synthetic dividend. This got me started towards the $1,000.

The Put Option Piece

The other trade I entered on the same day was a PUT ROLL (-CRDO280121P90 was the old PUT contract and -CRDO270115P130). This resulted in income of $1,003.57.

This trade means I was willing to have more cash held to ensure I could buy the CRDO shares if they were trading below $130 on January 15 of 2027. In other words, I went from $9,000 of cash held to $13,000. But I also shortened the number of days until expiration from January 2028 to January 2027.

Clearly this would make many investors nervous. I suppose it really hinges on your opinion of CRDO as a long-term investment and a willingness to watch the price of the shares bounce up and down during the life of the contract.

Recommendation

I realize that many don’t want to spend any time on trading options. They conclude that it is too complicated, too time-consuming, and just plain confusing. After training several friends and family members, I have realized that you are probably wrong if you think you cannot do this with a bit of training and guidance.

If you want to get started, then I recommend the following: 1) Download the desktop version of Trader+ from the Fidelity website; 2) Request options trading on at least one of your accounts (you must have 100 shares of a stock or ETF that is optionable to trade options.) When you sign up, request TIER 1 trading capabilities. That is sufficient for all of the things you will want to do as a beginner. 3) Reach out to me if you want to learn more.

Credo Technology Group Holding Ltd

Credo Technology Group Holding Ltd provides various high-speed connectivity solutions for optical and electrical Ethernet, and PCIe applications in the United States, Taiwan, Mainland China, Hong Kong, and internationally. It provides HiWire active electrical cables solutions, including HiWire CLOS, SPAN, SHIFT, and SWITCH; optical PAM4 digital signal processors; low-power line card PHY; serializer/deserializer (SerDes) chiplets; and SerDes IP, as well as integrated circuits. The company also offers intellectual property solutions consist of SerDes IP licensing. In addition, it offers predictive integrity link optimization and telemetry; PCIe retimer solutions; and support and maintenance, engineering, and royalties services. The company sells its products to hyperscalers, original equipment manufacturers, original design manufacturers, and optical module manufacturers, as well as into the enterprise and HPC markets. Credo Technology Group Holding Ltd was founded in 2008 and is based in Grand Cayman, the Cayman Islands.

Seeking Alpha Subscription Information

Of all of the resources I use, the most helpful is Seeking Alpha. The Seeking Alpha QUANT rating is a huge factor in my investment success. If you decide to explore a Seeking Alpha subscription, please use the following link. Seeking Alpha

This offer is the standard discount.

SEEKING ALPHA INFORMATION AND SUBSCRIPTION

You can also scan this QR Code to get the same information.

Past performance does not guarantee future results, Seeking Alpha does not provide personalized advice, and it is not a registered investment adviser.

We accept advertising compensation from companies that appear on our site. This website represents my opinions, which may not reflect those of Seeking Alpha, and does not constitute an investment recommendation or advice.

If you have any questions or problems getting connected to Seeking Alpha, reach out to them with this email address: subscriptions@seekingalpha.com