Made a couple of moves on Thursday.

music selection: “Out Of Line” — Device

weigh-in: 217.0 +2.0

First is a short bias trade.  I bet against Foot Locker (FL). FL is a mall based retailer.  For now it will avoid bankruptcy but there is pain ahead.  Same store sales have been flat for 3 years.  While online sales have been growing, there is competition around the corner.  Its main suppliers have started selling direct to the consumer.  This should cut deeply into sales and margins.  I bought the 25 strike 21JAN2022 expiry put for 6.30 a share (two contracts).  My price target is 7.00 per share.

I also rolled my NLY covered call.  It was in the money and shares were due to be called on Friday.  I wanted the 22 cent distribution going ex-div today.  So I closed the calls and opened 31JUL2020 6.5 strike calls for a net credit of 12 cents a share.   That is good for a 19.73% annualized return.  Adding in the distribution, the annualized return for the trade is 55.90%.  I hope to roll the trade to a 7 strike to capture more upside when possible.

Devour your prey raptors!

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Thursday trades with yields up to 55.9%

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2 thoughts on “Thursday trades with yields up to 55.9%

  • June 29, 2020 at 10:31 pm
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    What’s your cost basis on NLY now?

    Reply
    • June 29, 2020 at 11:26 pm
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      I was assigned at 6.00 and have collected 1.25 in premium so far (12 cents not yet earned). Shares were not called away today so I am guaranteed the 22 cent distribution as well.

      Reply

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