Yesterday with Intel trading down to ~$24.40 I entered into the following transaction:
09/05/2012 STO 5 INTC Oct 20 2012 22 Puts@.22 $96.16
This is a 45 day trade that is using $1350 in margin maintenance. If the puts expire worthless we will earn 7.1% or 57.6% annual return on maintenance. If put to us our yield on cost will be a whopping 4.12%.
That's 3 Intel trades I've got going for October with the 24's, 23's and now the 22's. After today's action I feel pretty good about it but if the trades go against me there appears to be ample opportunity to roll down and out for a net credit. As such, an exit strategy is in place.
Intel sounds like a good trade.
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