As detailed below, the potential return is +1.1% absolute return in 9 days (equivalent to a +46.2% annualized return-on-investment) if the stock price is unchanged. If the stock increases above the $67.00 strike price, the maximum possible absolute return of +1.7% (equivalent to a +68.6% annualized return-on-investment) will be achieved.
Note: the Implied Volatility (IV) of the options at the time they were sold was 20.8, so these options exceeded the Covered Calls Advisor's minimum threshold of IV>20 and thus provides a sufficiently attractive potential return-on-investment result for this position.
Express Scripts Holding Co.(ESRX) -- New 100% Cash-Secured Puts Position
03/09/2017 Sold 5 ESRX Mar2017 $67.00 100% cash-secured Put options @ $1.15
Note: the price of ESRX was $66.64 when these Puts were sold
Two possible overall performance results (including commissions) for this Express Scripts position is as follows:
Stock Cost Basis: $33,500.00
= $67.00*500 shares
(a) Options Income: +$566.80
= ($1.15*500 shares) - $8.20 commissions
(b) Dividend Income: +$0.00