Selling MU puts and GM puts for income.
Micron Tech (MU) is a profitable computer chip manufacturer that has sold off as the stock market moved lower.
The stock has a lot of value at this price point, trading for less than 7 times expected earnings. Higher volatility allows us to collect a lucrative income payment while still keeping a buffer between the current market price for MU and our agreement price to buy shares.
GM is one of the marquee auto makers in the U.S., and profits are set to grow as the economy reopens.
After a January pullback, shares are trading near 7.5 times expected earnings. That’s a deep value and should make GM an attractive buy candidate once stocks begin to rebound.
By selling the MU March $75 puts, we’re able to collect an attractive yield while minimizing our risk with a cushion between the current market price for MU and our strike price.
- Sell (to open) 1 MU March 18th $75 put
- Limit: $3.20 or more
- The new position will represent roughly 7.6% of our model.
~~~~~~~~ - 9:44 Executed
- Sold 1 MU March 18th $75 Put @ $3.60
ALSO
By selling the GM March $50 puts, we’re able to collect an attractive yield while minimizing our risk with a cushion between the current market price for GM and our strike price.
- Sell (to open) 1 GM March 18th $50 put
- Limit $3.00 or more
- The new position will represent roughly 5.1% of our model.
~~~~~~~~~ - 9:44 Executed
- Sold 1 GM March 18th $50 Put @ $3.26