Option Strategies Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Option Strategies

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: alanrs who wrote (1844)	2/1/2017 2:08:49 PM
From: robert b furman	Read Replies (1) of 2591

Hi all, Here's a trade I just put on. All of my CY puts expired to 00.00 in January. Cy is now trading in the high 11.00's and 12.00's. CY pays a 44 cent dividend annually - (4 x's 11 cents) Cy took over Spansion in March of 2015. Upon concluding the takeover they found an excess of memory. CY utilizes a lot of memory in their automotive chip business. During all of 2016 the burning of this excess memory had a negative effect on the fab utilization rate of CY's fabs. This memory chip burn essentially has been resolved last quarter/ last webcast. Earnings of CY will be out AH tomorrow. Recently CY also had a very large purchase of Broadcom's internet of things division. This enabled CY to have access to the best RF radio in the world. Good RF radios and the build out of thousands of IoT chips will propel CY into the fastest sectors of chip growth. My bet is CY will have great revenue numbers and improving margins from greater fab utilization rates FINALLY helping the margin picture. I've sold 20 puts on CY Jan 19 2018 12.00 puts for $1.85 today. If put to me my net purchase price will be $.44 / 10.15 = 4.335 % yield. If CY stays above $12.00 in January 19th of 2018 my collateralized cash will earn a premium to net price of 18.23 % (1.85 / 10.15) In between my account has received $3696.92. CY is my third largest position as I sold off some Cohu bought many years ago - as a tax loss to offset my sale of my partnership in 3 dealershhips in 2016. That loss offsets my gain on the sale and increases next years income from Cohu's 24 cent dividend to CY's 44 cent dividend. If put to me,it will help in reducing my average cost of the CY bought last year. I sold the Cohu for a 15 % higher price than I paid for the CY, so I have a little over a double increase in dividend pay for the associated sale of Cohu in 2017. In January of this year I had 25 $7.00 puts and 75 $8.00 puts expire to 00.00 this netted a cash gain in my account of $58020.06 and $940.36 of cy options expire last year in September - so I'm getting more comfortable with this trade as a regular position as long as CY's price does not get too high. I won't sell puts on anything over $12.00. Food for thought. Bob

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next