Saturday, 18 April 2015

Options Trade - Rogers Communications

On April 16, I sold a put in Rogers Communications. I own 275 shares at an average cost of $44. I've been waiting patiently for the stock price to dip below $40 in order to average down, but so far I haven't had the opportunity. 

The trade:
Sold 1 RCI.B Put Jan 15 '16 $40 Put @ 2.05 ($11.20 commission)
Days Held (sell date to expiry): 275
Net Premium: $193.80
Annualized Return = ($193.80 / ($4,000 - $193.80)) * 365/275 = 6.76%

The most likely outcomes of this trade are:

1. Shares are trading above $40.00 at expiration. I will get to keep $193.80 in net premiums.

2. RCI.B is trading below $40.00 at or before expiration and shares are assigned. I will receive 100 shares of RCI.B at a net cost of $38.06/share.

My put in GIS and my call in VOD both expired worthless on April 17. That's $257.57 in net premiums that I get to keep. I'll probably sell another call on my VOD shares soon.

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