A Little Less Bullishness For Google

In a couple of previous articles related to Internet search company Google (GOOG) posted on April 15, 2012 and May 25, 2012, bull-put credit spreads were considered for the company. A bull-put credit spread may be entered for a credit by selling one put option and purchasing a second put option further out-of-the-money with the goal of the options expiring worthless and retaining the initial credit as a profit. The first bull-put credit spread was successful and provided a return of 7% (70.5% annualized).

The second bull-put credit spread considered consisted of a short 2012 Jun 540 put option and a long 2012 Jun 515 put option. The position was entered for a net credit of $1.77, which represented a potential return of 7.6% (126.4% annualized). A management point of $565 was set for the position, which has been breached (shown below), so consideration for an exit or a roll is given. Additionally, since there’s only 4 days until June option expiration, consideration is given for modifying the management point and maintaining the position as is.

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Netflix: Highest Return Protected Covered Call

A protected covered call or collar search performed using PowerOptions tools, seeking to find the highest returning position for companies with a maximum potential loss of 8% and a stock price in an uptrend, produced digital video content provider Netflix (NFLX) as shown below:

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