I am reporting another options trade for 03/06. LO shares have been under weakness for a while due to reports about flavoring/menthol being banned from cigarettes. I continue to be bullish LO long-term and welcome any opportunities to add to my position.
I Sold 1 LO Jan 18 ’14 $40 Put @ 5.35.
This trade could turn out a few ways:
1) I hold shares until expiration and shares are trading above $40.00. I will get to keep the $535 in options premiums.
2) I hold shares until expiration and shares are trading below $40.00. I will get assigned 100 shares of LO at a cost of $34.65 per share. This price would give me a YOC of 6.3% without any further dividend increases.
3) Shares of LO go on a run and I decide to buy back the put early for a profit less than $535.
I currently have 17 open options positions and a total options profit of $1178 for 2013. I’ve also increased my options account to 12k to keep it about 10% of my portfolio. My options page has been updated accordingly.