On 25APR2016, I wrote more puts on MSFT to replace an expired position.
music selection: “Angel” — Jimi Hendrix
Microsoft is one of the Big Cheap Tech names I’ve been riding for easy income for some time. These big tech companies have a huge hoard of cash on their fortress balance sheets and gush free cash flow. Their central position to a critical industry makes them more like digital utilities than the high flying tech names of the dot-com era. They tend to sport fat options premiums as well.
I sold MSFT160603P00050000 for 79 cents a share. The trade will be in force for 40 days and yields 14.42% on an annualized basis. The trade also enjoys 4.94% downside protection. The recent broad swoon of the market has put this one slightly in the money but I’m not worried. Covered calls should be just as lucrative.
I have a three part position in high yield thermal coal for you Friday.
Devour your prey raptors!