The opinions expressed are those of Market Shadows and the author, not those of the Wall Street Examiner. The Wall Street Examiner makes no representation regarding the accuracy or validity of the ideas expressed in the post. No recommendation or endorsement is intended or implied. This post is presented for informational purposes as representative of one of a range of views on the subject. Do all necessary due diligence before considering any investment.
Consult with Accenture. We’re adding a new LEAP put position.
Disappointing quarterly results sent shares of Accenture (ACN) tumbling this morning. Just after 10 AM the stock was down more than 13% to $69.74 per share.
Market Shadows used the lower price and increased volatility to sell a January 2015 $70 strike price put for $9.70 per share.
We collected $970 for the contract ($9.70 x 100 shares) which represents our maximum profit if the option ends up expiring in early 2015.
If Accenture closes below $70 on Jan. 17, 2015 we will be forced to buy 100 shares at a net cost of $70 – $9.70 = $60.30 per share.
The stock could drop by as much as $9.44 per share from the trade inception price (-13.5%) without causing a loss on this trade.
See our full Virtual Put Selling Portfolio here http://marketshadows.com/virtual-portfolios/put-selling-virtual-portfolio/
Wall Street Examiner Disclaimer: The Wall Street Examiner reposts third party content with the permission of the publisher. I curate these posts on the basis of whether they represent an interesting and logical point of view, that may or may not agree with my own views. No promotional consideration has been offered or accepted. The opinions expressed in these reposts are not those of the Wall Street Examiner or Lee Adler and no endorsement of the content so provided is either expressed or implied by our posting the content. Some of the content includes the original publisher's promotional messages. The Wall Street Examiner is not familiar with the services offered and makes no endorsement or recommendation regarding them. Do your own due diligence when considering the offerings of third party providers.