william the wie
Gold Member
- Nov 18, 2009
- 16,667
- 2,402
- 280
My strategy is only to write puts where no matter what happens I can get 50% cash on cash annualized yield. I cannot get fully invested at the moment. My goal is achieved by only writing puts on safe haven stocks:
1) Selling for less than estimated liquidation value.
The PE is less than PEG (percentage earning growth over the last five years)
2) Then I do another cull:
The two month put premium exceeds 10% and the call premium is slightly higher based on getting the issue exercised to me at 90% of market.
Then I make sure there are more puts than calls outstanding at the strike price and expiration date I am looking at. I do this because the underlying has to be purchased for the put to be exercised and that drives the stock price up and the call premium. This last part is where I am having a problem. More calls are being bought than puts. Therefore there is no predictable floor.
1) Selling for less than estimated liquidation value.
The PE is less than PEG (percentage earning growth over the last five years)
2) Then I do another cull:
The two month put premium exceeds 10% and the call premium is slightly higher based on getting the issue exercised to me at 90% of market.
Then I make sure there are more puts than calls outstanding at the strike price and expiration date I am looking at. I do this because the underlying has to be purchased for the put to be exercised and that drives the stock price up and the call premium. This last part is where I am having a problem. More calls are being bought than puts. Therefore there is no predictable floor.