Option Investor

Option Writer Portfolio - July

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Tiffany & Co (Symbol: TIF) is back on the list for July as a short put (naked put). Tiffany's is a chain of high end jewelry stores that target the high net worth shopper. Tiffany & Co., through its subsidiaries, engages in the design, manufacture, and retail of fine jewelry. TIF sells products through catalogs, retail sales, and business-to-business direct selling operations in the United States. The company also sells its products through TIFFANY & CO. stores and department store boutiques, as well as through business-to-business, Internet, and wholesale stores internationally.

EPS date: August 28th.

Sector: Consumer Services

The stock is a little over $2 out of the money. With about five weeks until expiration we are selling the July 45 strike for $1.25 per contract. This trade is producing a 17% return on the initial cash requirement.

The first line of suppot is at the 200 day SMA cuurently at 45.27. Then $44.80 comes in at the June 11th low which is close to the 50 day SMA. We are going long on TIF because it bounced nicely off the 200 day SMA.

Risk Management for TIF
Strike Stop = $ 45.00
Cost Basis Stop = $ 43.75
Technical Stop = $ 44.80
Premium Stop = $ 44.20

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