http://finance.yahoo.com/news/verizon-vz-q2-results-likely-132401609.html https://www.thestreet.com/story/135...high-yield-dividend-stocks-shouldn-t-you.html http://finance.yahoo.com/q/ks?s=VZ+Key+Statistics (high cash flow but not high priced) http://finance.yahoo.com/echarts?s=VZ+Interactive#{"range":"10y","allowChartStacking":true} I want to buy VZ for it's dividend plus selling calls against it...but not at it's current price. It's having a continuing labor problem that is inhibiting it's upside so this might be a good entry point. I would like to get it at $35 or so.. but while I wait for that price I can duplicate it's high dividend with a long term put spread: With VZ at 49.85 Jan '18 35/30 bull put spread for a net credit of $45 Yield = 45/455 = 9.9% in 604 days or 6.0% annualized (VZ currently pays 4.6% annually) Prob = 97% Expectation = .97(45) - .01(455) - .02(228) = 43.65 - 4.55 - 4.56 = 34.5 Price............ Profit / Loss........... ROM % 25.00................ (455.00)............. -90.10% 30.00................ (455.00)............. -90.10% 30.14................ (440.90)............. -88.18% 34.55..................... 0.00................. 0.00% 35.00................... 45.00................. 9.90% 40.00................... 45.00................. 9.90% 45.00................... 45.00................. 9.90% 50.00................... 45.00................. 9.90% 55.00................... 45.00................. 9.90% If VZ should pull back to $35 (I really don't think it will) I would take the stock, sell the long put for a profit and begin collecting dividend and selling calls.
The VZ spread filled yesterday at $45 BTW I have been updating my trades as things occur. I personally think this has resulted in too many updates..... I started updating in response to complaints that I didn't update any of my trades. (from optionguru as I remember). Plus I have been posting my fills in response to some other people who complained that they didn't know whether my trades were real or hypothetical, and doubted I could get fills on them. Let me know if you want me to stop.
http://seekingalpha.com/article/400...ividend-growth-stocks-current-price-justified http://www.msn.com/en-us/money/topstories/understanding-verizons-capital-structure-vz/ar-BBw633S http://stockcharts.com/h-sc/ui?s=vz http://stockcharts.com/h-sc/ui?s=T http://www.msn.com/en-us/money/stockdetails/financials/fi-126.1.VZ.NYS http://www.msn.com/en-us/money/stockdetails/financials/fi-126.1.T.NYS Adding T to the portfolio: With T at 40.68 Apr 35/30 bull put spread for a net credit of $44 Yield = 44/456 = 9.6% in 235 days or 14.8% annualized Prob = 90% Expectation = .9(44) - .01(456) - .09(228) = 39.6 - 4.56 - 20.52 = 14.5 Price........... Profit / Loss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
Medium term downtrend intact while longer term uptrend remains in existence. We are likely due for a bounce. Short term buy would make sense on a break of 53 to the upside.