Deep OTM NP Strategy – JUNE Week 1

Fellow Traders,

It’s been a busy week at my house.  My oldest son graduated from high school yesterday.  Thus, the week was filled with preparations for the obligatory ‘open house’ and arrival of out-of-town relatives, some of which are still here.  Thus, my investment analysis and subsequent write-up in this post will be short and to the point.

Here are the trades that met our  selection criteria for this last week before JUNE expiration.

None of these selections peaked my interest.  None are ones I’d be willing to hold should they fall and expire ITM.  Given the current market conditions that is a critical consideration.

Several selections from earlier this month also passed our Week 1 screener.  RIMM is one.  It closed Friday at $36.56.  For the week it was down $2.42 (6.21%).  Both the JUN $32.50 and $30 strikes meet our JUN Week 1 criteria.  The puts closed Friday $0.46 and $0.16 respectively.  With the $32.50 strike you get 12.36% DSP.  This trade yields 1.4% ROIC with one week to expiration and has a PF of 5.3.  The $30 strike has 18.38% DSP, a 0.53% ROIC, and a PF of 3.5.

Another selection from earlier this month which reappeared this week is IDCC.  It closed Friday at $35.91, down $1.97 (5.2%) for the week.  The $32 strike at $0.30 has 11.72% DSP with a ROIC of 0.94%.

Well, that’s it for this week for our Deep OTM NP Strategy.  If time allows I’ll be back later in the day with another post updating my CSCO NP trade.

Regards,

Troy