Here is a trade I just put on in my personal account.
The stock is NLY. The trade is a simple Put credit spread
Sell to Open Oct 16 Puts (.40)
Buy To Open Oct 15 Puts (.26) for a credit of .14 cents per spread.
Trade has a 74% probability of success. And can make 16.2% if left to expiration.
NLY is a financial company but a very boring stock. I love owning this one as well because it pays a little over 10% dividend right now.
So here is how the trade works: If NLY is above 16 on expiration day (right now it is trading at 17.68) I make the whole 16.2% minus whatever commissions I paid to get into the trade. If NLY is below 16 and above 15 I will be assigned the stock if I don’t exit the trade. Again, I don’t mind owning this stock. if NLy is below [...]