Trade Continuation: Intel (INTC) Naked Puts

On October 10th I rolled this Intel trade as follows:

08/22/12   STO 5 INTC Oct 20 2012 24 Puts @.37        $171.18
10/10/12   BTC 5 INTC Oct 20 2012 24 Puts @2.15     -1088.79
10/10/12   STO 5 INTC Nov 17 2012 24 Puts @2.40     1196.13



It's no secret that Intel tanked...and hard. When I entered into this trade Intel was at 25.70 and it tanked to the low 21's.

I rolled these puts out a month for a net credit of $107.34. I have now brought in $278.51 in option premium. This lowers my cost basis in INTC to $23.44. As of this writing that puts me down ~.96/share. Not bad for a complete tank job! Put selling is a very valuable trading tool.

Absent unforeseen circumstances, I will roll these puts again in a couple of weeks, dropping my cost basis once more. I can roll out at the same strike with 5 contracts, roll out at the same strike lowering to 4 contracts or roll out and down. I will only do so for a net credit.