No fair value for MELI today: our four models disagree too much — the highest is more than 3 times the lowest ($2,205 to $8,650), so an average would mean nothing.
Prices as of 11:49 PM ET, Sep 21. Check the live quote before you send an order.
The put
Skip
Skip the put. The money looks good, but MELI swings more than it pays. Want MELI? Buy shares.
If it goes against you: you buy 100 shares at $1600, which after the $1,950 you keep works out to $1,580.50 a share. Below $1,580.50 you are down on the trade. From that day the shares take above is the one that applies.
The order, if you sell it anyway
You get$1,950 (limit about $19.50)
If it fallsBuy 100 shares at $1600
Cash to hold$160,000
Close earlyBuy back at about $19.50 ($1,950)
Chance you buy the sharesabout 15 in 100
ContractMELI Oct 30 $1600 put
ActionSell to open
In your broker app: open the stock → Trade → Options → Sell to open → pick the contract shown here.
Why skip
The put: Oct 30, $1600 strike, 39 days out. Pays $1,950. Roughly a 15-in-100 chance you end up buying the shares.
On paper: 11% a year. That number assumes MELI keeps moving like it did the past two years. Take that away and it is -9% a year. That is why we say skip.
Next earnings Nov 4, after this put ends. We never sell a put across a report.
If you already own 100 shares
Income call
For income on MELI you already hold: sell the Oct 30 $2090 call and take $1,720 now. If MELI climbs to $2090 by Oct 30, your 100 shares are sold at $2090, so only do it if you're happy selling there.
If it climbs past $2090 your 100 shares are sold at $2090 and you keep the $1,720. That is the trade working, not a loss.