3 Options Trades for $1,000 in Monthly Income

Selling naked puts for a standard monthly return

      View All  
3 Options Trades for $1,000 in Monthly Income

DirecTV (DTV)

directv logo 3 Options Trades for $1,000 in Monthly IncomeI had been very bullish on the long-term prospects for DirecTV (DTV). DTV stock had performed decently over the past few years, but never delivered the blockbuster returns I’d hoped for. Instead, it morphed into a great trading vehicle and a stock perfect to sell naked puts against.

DTV carries a lot more debt than it used to, its growth rate has slowed, but it still generates enormous cash flow. So it’s a safe company, and having shares put to me would not be any great tragedy.

In selling the Jan 70 Puts for $1.40, I pick up a 2% return for just a two-week holding period, and if the shares get put to me, I’d probably turn around and sell calls against those DTV shares for February. I sold two of the puts contracts for $280 in income.


Article printed from InvestorPlace Media, http://investorplace.com/2014/01/options-trades-amgn-dtv-bbby/.

©2014 InvestorPlace Media, LLC

Comments are currently unavailable. Please check back soon.