I bought a bear put spread in GPC.

music selection:  “Little Dreamer” — Van Halen

weigh-in:  219.8 n/c

First a little clean up.  I have a bear put spread in Nucor (NUE) that had 5 contracts (500 shares) assigned.  I exercised five long puts to close out the hedge.   I had 2,099 in capital at risk on those 5 spreads and earned 401 over 22 days.  That is good for 19% or 317% annualized.  Four spreads remain open.

Genuine Parts (GPC) is an auto parts company and a Dividend Aristocrat with 57 consecutive years of distribution increases. It is a mature company with a slow moving stock price making it a good candidate for in the money spreads.  I bought 10 spreads this morning at the 100/105 strikes and 19MAR2021 expiry.  I got 3.771 pricing.  With the share price at 94.95, the trade enjoys 5.32% downside protection over 47 days in force.  Should that protection not be breached, I will earn 1,229 on 3,771 capital at risk. That is good for 32.6% or 253% annualized.

My February is currently underwater due to a WMT spread that has moved out of the money.  I haven’t hit my stop loss yet and am hopeful for a good earnings report/Christmas season to move me back in the green the day before expiry.

Devour your prey raptors!

Genuine Parts Spread with 253% yield

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