I bought shares of Prospect Capital and now I’m going for an options kicker.
music selection: “Love Stinks” — The J. Geils Band
weigh-in: 219.2 +2.0 (ouch, too much holiday bbq)
The underlying shares yield over 12% and is paid monthly. On the 20th, I sold PSEC160819C00008000 for 5 cents a share. The trade will be in force for 61 days and yields 3.74% on an annualized basis. I’m enjoying 0.64% downside protection and have room to pick up as much as 15 cents in capital appreciation before shares are called away. In that event, my annualized yield would be 14.96%. I’d prefer to write puts at 7 but this one has shown some price strength lately made that trade less attractive than covered calls at 8.
In other news, the MEGA Millions lottery is at 449 million for the jackpot. Will you be risking a ticket?
Devour your prey raptors!