MNV
Market News Video
MNV MNV 10 Stocks Crossing Above Their 200 Day Moving Average
MNV
MNV
MNV
MNV
MNV
MNV
MNV
Free Dividend Report - Top Ranked Stocks

Featured MNV Articles:

Washington Prime Group's Series I Preferred Shares Cross 11% Yield Mark
Wednesday, January 2, 2:08 PM ET, by Market News Video Staff

In trading on Wednesday, shares of Washington Prime Group's 6.875% Series I Cumulative Redeemable Preferred ...

Washington Prime Group's Series H Preferred Shares Yield Pushes Past 11.5%
Tuesday, January 8, 2:54 PM ET, by Market News Video Staff

In trading on Tuesday, shares of Washington Prime Group's 7.5% Series H Cumulative Redeemable Preferred ...

Ray Dalio Vs. The Shorts: Five Surprising Holdings
Tuesday, January 29, 11:10 AM ET, by Market News Video Staff

An examination of the most recent short interest data revealed these five Ray Dalio stocks ...

Short Sellers Drawn To These Five Ray Dalio Holdings
Tuesday, February 12, 10:23 AM ET, by Market News Video Staff

An examination of the most recent short interest data revealed these five Ray Dalio stocks ...

Interesting WPG Put Options For October 18th
Wednesday, February 20, 11:00 AM ET, by Market News Video Staff

Investors in Washington Prime Group (WPG) saw new options become available this week, for the ...

Commit To Buy Washington Prime Group At $2.50, Earn 6.9% Annualized Using Options

By Market News Video Staff, Wednesday, June 19, 11:50 AM ET
Play Video: How To Sell A PUT


If the video does not load after a few moments, Upgrade to the Latest Flash Player.

Investors considering a purchase of Washington Prime Group (NYSE:WPG) shares, but tentative about paying the going market price of $4.10/share, might benefit from considering selling puts among the alternative strategies at their disposal. One interesting put contract in particular, is the January 2020 put at the $2.50 strike, which has a bid at the time of this writing of 10 cents. Collecting that bid as the premium represents a 4% return against the $2.50 commitment, or a 6.9% annualized rate of return (at Stock Options Channel we call this the YieldBoost).

Selling a put does not give an investor access to WPG's upside potential the way owning shares would, because the put seller only ends up owning shares in the scenario where the contract is exercised. And the person on the other side of the contract would only benefit from exercising at the $2.50 strike if doing so produced a better outcome than selling at the going market price. (Do options carry counterparty risk? This and six other common options myths debunked). So unless Washington Prime Group sees its shares fall 39.9% and the contract is exercised (resulting in a cost basis of $2.40 per share before broker commissions, subtracting the 10 cents from $2.50), the only upside to the put seller is from collecting that premium for the 6.9% annualized rate of return.

Below is a chart showing the trailing twelve month trading history for Washington Prime Group , and highlighting in green where the $2.50 strike is located relative to that history:

The chart above, and the stock's historical volatility, can be a helpful guide in combination with fundamental analysis to judge whether selling the January 2020 put at the $2.50 strike for the 6.9% annualized rate of return represents good reward for the risks. We calculate the trailing twelve month volatility for Washington Prime Group (considering the last 251 trading day closing values as well as today's price of $4.10) to be 42%. For other put options contract ideas at the various different available expirations, visit the WPG Stock Options page of StockOptionsChannel.com.

In mid-afternoon trading on Wednesday, the put volume among S&P 500 components was 1.11M contracts, with call volume at 1.11M, for a put:call ratio of 0.70 so far for the day, which is above normal compared to the long-term median put:call ratio of .65. In other words, if we look at the number of call buyers and then use the long-term median to project the number of put buyers we'd expect to see, we're actually seeing more put buyers than expected out there in options trading so far today. Find out which 15 call and put options traders are talking about today.


This Article's Word Cloud:   Group   January   Options   Prime   Stock   Washington   YieldBoost   about   above   among   annualized   benefit   buyers   call   cents   chart   considering   contract   exercised   fillColor   from   going   history   long   market   median   month   number   only   options   other   owning   premium   price   rate   ratio   represents   return   seller   selling   share   shares   strike   term   than   that   this   today   trading   which
MNV
MNV
About Us - Advertise - Contact Us - Embedding Videos - Licensing Videos - Partners - mRSS / RSS Feed - Terms of Use - Privacy Policy
MNV
Home  |  Analyst News  Dividend Report  ETFs  Insider Report  Large Caps  Market Movers  Week Ahead Report  Weekly Market Wrap
MNV
MNV MNV Chart Zero Stock Market Game Stock Market Definitions
MNV

Commit To Buy Washington Prime Group At $2.50, Earn 6.9% Annualized Using Options | Market News Video | Copyright © 2008 - 2019, All Rights Reserved

Any ideas and opinions presented in all Market News Video clips are for informational and educational purposes only, and do not reflect the opinions of BNK Invest, Inc. or any of its affiliates, subsidiaries or partners. In no way should any content contained herein be interpreted to represent trading or investment advice. None of the information contained herein constitutes a recommendation that any particular security, portfolio, transaction, or investment strategy is suitable for any specific person. All viewers agree that under no circumstances will BNK Invest, Inc,. its subsidiaries, partners, officers, employees, affiliates, or agents be held liable for any loss or damage caused by your reliance on information obtained. Read Full Disclaimer.