I am watching CNBC, the price of oil falling again while reviewing my options for the near months.  I have (had) a COP Feb08 85 put that was uncomfortably underwater with the price of COP at $77.55.  I ran the May08 85 put through my spreadsheet and saw that I could roll it out and generate a 19.38% return on the net premium and an additional $137.52 in my IRA account.

When I actually made the trade I entered a limit order .10 lower than the ask for the BTC.  It was executed almost immediately.  Then I entered a limit order .10 higher than the bid to roll out.  It took a couple of minutes but it was also executed.  The result of not just accepting the ask and bid prices was a 21.49% return on the net premium and an additional $152.50 in my IRA account.  Entering limit orders between the bid and ask price is something I do quite often.  I don’t track how often this succeeds but I think it is between 25 - 50% of the time.

Now, if put to me I would own COP at $81.45, still above the current price but better than the prior situation.