Today shares of Beyond Meat (BYND) have advanced more than five percent and the option position (short put; expiration: Nov. 20th; Strike: $105) was repurchased to close thanks to a limit order I had previously established. With shares of BYND trading for more than $184, our strike price was 57% below the market. We held this short position for nine days and kept $154.26 of the premium after purchasing to close our position. With $10,500 exposed to this trade, we earned 1.5% on invested capital, 59.6% on an annualized basis.
Source: MarketWatch.com, accessed 11:40 AM on 6OCT2020
JP Morgan Chase (JPM) has rebounded since Friday when the President was taken to a hospital. During that brief turmoil, I sold a put on JPM that expires November 20th with a strike price of $85. Today we had that position closed by a standing limit order for $100.69 after commission. When I checked the market for that option JPM traded for $100.42 and the put option bid-ask was $0.91-$0.94. We left a few dollars on the table, but I am glad to have the position closed to bolster cash and flexibility in our portfolio.
Our $8,500 of capital required to cover the JPM trade was only exposed for four days, two of which were this past Saturday and Sunday. The JPM trade cleared $93.61, 1.1% of capital exposed. Over such a short holding period the trade returned 100.5% on an annualized basis.
Source: MarketWatch.com, accessed 11:40 AM OCT62020