DiviMo's Blog : DiviMO: More commentary on Visa

Ours is an income strategy. To that the goal is consistent income  while risking as little capital as possible.  As long as I can continue to roll for additional income , I will invest in dividend paying stocks and trade options that pay an immediate premium (sell naked puts and sell covered calls)  in those type of stocks.

I've written several times on Visa (V). Let's continue and check out the game plan. Our current play is very highly likely to expire this coming Friday. We lock in our premium of $70.00 per contract. It was the naked sell put play on 18Jul 72.50 puts. On Monday, we plan on doing another cash assisted (naked) put play. Here are my choices.

lets look at Visa July puts and contracts sold (based on today's prices)

  July 72.50 put @ $1.50 premium collected $150.00 per contract,  Estimated profit 12.75%  Probability of Visa being $72.50 at expiry 43%

July 70.00 put @ 91 cts premium collected $91.00 per contract.    Estimated profit  9.85%   Probability of Visa being $70.00 at expiry 23%

 July 65.00 put @ 32 cts premium collected $32.00 per contract.   Estimated profit  4.9%     Probability of Visa being $65.00 at expiry 7.7%  

For my trade I would sell the 65's and have a 92% chance of a winning trade or sell the 70's and have a 77%  of a winning trade. Maybe do both. Will let you know my choice this weekend.