On May 15, 2019, I made the following put sell - WPG OCT 18'19 5 Put @0.7
This is already the fourteen (#14) put sell from my short options trader career. For now, it seems I've found my way in options trading - I'm selling puts against (high) dividend paying stocks I already own or I would like to have.
WPG is a stock we already hold and wouldn't mind to add more in our children portfolio.
As we already own this stock and would love to increase our share here, I love the idea that I could get it on discounted price + I can collect premium upfront.
Got for this trade a premium of $70, but I will be obligated to buy 100 shares of WPG if the price will drop below 5 USD per share by October 18, 2019. Currently trading at $4.95
Break-even price: $4.3
This latest trade gives 31.63% yield annually. In case I will be obligated to buy this stock, I already have collected premium, and my real buying price will be $4.3 or just $430 for 100 shares of WPG, with an annualized dividend at $1.00 that's a whopping 23% yield.