On May 13, I sold a put option in Telus Corporation that trades in Canada. The put option had 06/19/2015 for expiration and the strike price was $40.00. The option was not assigned as the price of the stock remained above the strike price including at expiration. You can read about the selling of the put option here, which is the option trade #1 in the link.
Recap: Premium collected after commissions : $35.05
Return on Capital : 4.420%
Return on Capital Annualized : 43.6%
Days to Expiration : 37
We can also calculate the return:
Return = premium collected / (cost of investment - option premium collected)
Return = $35.05 /($4000-$35.05)
Return = 0.884%
Return annualized = Return/37*365
Return annualized = 8.286%
The second option trade was selling a put option in Rogers Communications Class B stock at a strike price of $42.00. The price of the stock was trading lower on the day of the expiration and remained below the strike price the entire day of Jun 19, 2015. For my broker, usually the option stays in the account until Monday evening, as that is the day the trade is updated. But the put position does not show in my account and the balance as not been changed. According to my brokerage account, the stock last traded at $41.83. So will have to wait until Monday evening to find out if the option was assigned.
For disclosure, I own 100 shares of RCI.B prior to making this trade.
To be continued in Part #2.
Disclosure: Long RCI.B
am not a financial planner, financial advisor, accountant or tax
attorney. The information on this blog represents my own thoughts and
opinions and should NOT be taken as investment or business advice.
individual should do their due diligence to make their own financial
decisions based on their financial situation and tolerance for risk.