Money and Finance
This is going in the Recent Buy section even though I didn't buy anything. I sold a put contract for Intel today expiring July 20, 2012. The strike price is for $25 and I sold it for $0.53 per share or $53. By selling this put contract I was able to receive $53 less commission for a total of 1.35% return on the $2,500 in capital being tied up. So over the 39 days til the contract expires that equates to a 13.38% annual return. Not bad, especially considering that Intel is currently selling for $25.98. This put contract will give me a solid return if it goes unexercised and if it does get exercised that's actually what I'm looking for. If the put contract does get exercised my cost basis on the 100 share lot will be $25 less the premium ($0.53) + the commission ($7.95 + $0.06) = $24.55. At the current annual dividend rate of $0.90 per share that will give me a YOC of 3.67% which is 8.00% better than the current yield.
If you remember from my stock analysis on Intel , the average fair value was $30.40. I also set a 3.50% target entry YOC which corresponds to the $25.71 cost basis. The reason I sold the put option contract is because it is giving me a good return either way. Ideally the contract would be exercised with the stock price just slightly under $25 but above my $24.55 entry price.
All the returns are after-tax returns. I've assumed that I will be in the 25% marginal tax bracket at the end of the year.
- Selling Puts For Added Income
This morning Archer-Daniels Midland was trading at $26.97. Since I would like to get more into the stock with it trading around a 14% discount to my calculated fair value, I figured I would check out the potential option moves to make. The fair value...
- Recent Transaction
Yesterday I sold another put option on Intel. I sold the $25 17 Aug 2012 put for $0.46. Less commission I received a total of $38.01 in premium for a total return of 1.52% which is annualized to 21.75%. I figured that since I want to add to my Intel position...
- Intel Put Option
With Intel currently trading at $25.60 it looks like my put option that I sold on Intel is going to expire today. It's a good and bad thing because I wouldn't have minded getting Intel at the $25 strike less the premium. But I got a pretty good...
- Selling Puts For Added Income
It's about time for another look at possible put option moves to get a better entry price or for added income. All calculations are based off of prices from March 20, 2012. Today I'll be looking at Bank of America. I still have high regard for...
- Selling Puts For Added Income
I've been looking around and have found some other potentially lucrative put option plays. All information is based off the closing values from February 10, 2012 and that the puts would be sold the morning of February 13, 2012. The current price for...
Money and Finance
Recent Transaction
This is going in the Recent Buy section even though I didn't buy anything. I sold a put contract for Intel today expiring July 20, 2012. The strike price is for $25 and I sold it for $0.53 per share or $53. By selling this put contract I was able to receive $53 less commission for a total of 1.35% return on the $2,500 in capital being tied up. So over the 39 days til the contract expires that equates to a 13.38% annual return. Not bad, especially considering that Intel is currently selling for $25.98. This put contract will give me a solid return if it goes unexercised and if it does get exercised that's actually what I'm looking for. If the put contract does get exercised my cost basis on the 100 share lot will be $25 less the premium ($0.53) + the commission ($7.95 + $0.06) = $24.55. At the current annual dividend rate of $0.90 per share that will give me a YOC of 3.67% which is 8.00% better than the current yield.
If you remember from my stock analysis on Intel , the average fair value was $30.40. I also set a 3.50% target entry YOC which corresponds to the $25.71 cost basis. The reason I sold the put option contract is because it is giving me a good return either way. Ideally the contract would be exercised with the stock price just slightly under $25 but above my $24.55 entry price.
All the returns are after-tax returns. I've assumed that I will be in the 25% marginal tax bracket at the end of the year.
- Selling Puts For Added Income
This morning Archer-Daniels Midland was trading at $26.97. Since I would like to get more into the stock with it trading around a 14% discount to my calculated fair value, I figured I would check out the potential option moves to make. The fair value...
- Recent Transaction
Yesterday I sold another put option on Intel. I sold the $25 17 Aug 2012 put for $0.46. Less commission I received a total of $38.01 in premium for a total return of 1.52% which is annualized to 21.75%. I figured that since I want to add to my Intel position...
- Intel Put Option
With Intel currently trading at $25.60 it looks like my put option that I sold on Intel is going to expire today. It's a good and bad thing because I wouldn't have minded getting Intel at the $25 strike less the premium. But I got a pretty good...
- Selling Puts For Added Income
It's about time for another look at possible put option moves to get a better entry price or for added income. All calculations are based off of prices from March 20, 2012. Today I'll be looking at Bank of America. I still have high regard for...
- Selling Puts For Added Income
I've been looking around and have found some other potentially lucrative put option plays. All information is based off the closing values from February 10, 2012 and that the puts would be sold the morning of February 13, 2012. The current price for...