On July 8th, 2019, I made the following in the money (ITM) put sell -  ET AUG 16'19 14 Put @0.33

This is already the thirty-seventh (#37) 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.

ET currently is trading at $14.72 and has a yearly dividend payout of $1.22 giving a yield of 8.28% (before taxes). Dividends are paid quarterly in the following months - Feb, May, Aug, and Nov. These are the months I'm always worried about, in case I will be assigned ET stock before options expiry I will have 100 shares paying me dividends in lowest months of the year. Awesome.

Got for this trade a premium of $33, but I will be obligated to buy 100 shares of ET if the price will drop below $14 USD per share by Aug 2, 2019. 

Break-even price: $13.67

This latest trade gives 20.46% yield annually

In case I will be obligated to buy this stock, I already have collected premium, and my real buying price will be $13.67 or just $1,367 for 100 shares of ET with an annualized dividend at $1.22  that's 8.92% dividend yield.

I took this trade because of following reasons - to boost my total options income in July, and in case I will get assigned, I will be able to sell covered calls.

Get the latest dividend income article in your inbox

Join more than 200 subscribers and get notified once the newest dividend income article is is out.
* indicates required

You can unsubscribe at any time by clicking the link in the footer of our emails. For information about our privacy practices, please visit Privacy policy