Our perfect streak in options trades this year finally came to an end last week. Our $45 call option on General Mills (NYSE: GIS) closed out-of-the-money on Friday for a total loss.

That hurts, but we know there will be a few clunkers mixed in with our many winners. That is why we advise participating in all of our trades in roughly equal amounts. If you have participated in all of our closed options trades in 2018 at our entry and exit prices, you would have a net gain of 38%.

A subscriber asked if I was going to roll the GIS trade in hopes of recouping our investment. As I replied to that reader, we do not roll trades in Systematic Wealth (but I did provide guidance in that response for those wishing to do so). To my way of thinking, rolling an options trade is no different than simply taking the loss on the old trade and then making an entirely new trade.

Although I still believe GIS will rally above $45 this year, I was not excited by comments made by the company’s CEO at its recent Investor Day presentation. I don’t think stressing global growth priorities in the midst of escalating trade tensions was the best tack to take, and nothing else he said conveyed a sense of urgency that might cause the stock to pop soon.

At the moment, our other four open option positions are equally split between winners and losers. Three of them expire on October 19, so we still have three months for the call options on Walgreens (NYSE: WBA) and Western Digital (NasdaqGS: WDC) to get back in-the-money. Our put option on Hilton Worldwide Holdings (NYSE: HLT) is already in the money, and several readers have reported booking sizable profits in that position.

Our biggest winner at the moment is also our most recent addition to the portfolio. As of this morning, our $35 call option on Johnson Controls International (NYSE: JCI) expiring in January is up 50% from where we bought it. If we get the 100% gain I am targeting for this position early then I will most likely close out this position prior to expiration.

Taking Stock

Our four open equity positions are also an equal mix of winners and losers at the moment. Our target holding period for Despegar (NYSE: DESP) expires at the end of this week, but I am going to extend this trade another two months. The company announced a shake-up in the C-suite last week, and I want to see what sort of guidance the new CEO provides (if any) when the company releases its Q2 results next month. [note: I will also issue a separate alert regarding this trade extension later this week]

We closed out our call option in Hanesbrands (NYSE: HBI) last month after it tripled in value, but I have left open the equity position until we hit our target price of $23.25 (which may be soon, since the company is due to release its Q2 results before the market opens on August 1). Our equity position in Johnson Controls International illustrates the power of leverage with options; as I mentioned above our call option in JCI has gained 50% while our equity position is up a modest 8%!

As for Western-Digital, I remain confident that it will soon rise back above $80. Currently priced at less than six times forward earnings, there is no rational explanation I can find for its extreme undervaluation. The company releases its fiscal Q4 results at the end of this week, so we may see some movement in our direction then if the news is good. Even if the stock starts trading at only eight times forward earnings, or roughly half the multiple for the S&P 500 index, that would represent a 25% increase from its current level.