Option Investor
Newsletter

December Option Position

HAVING TROUBLE PRINTING?
Printer friendly version

Abbott Laboratories (ABT) engages in the development, manufacture, and sale of health care products worldwide. It operates in four segments: Pharmaceutical Products, Diagnostic Products, Nutritional Products, and Vascular Products. The stock recently dropped on reports that TEVA would be producing a generic cholesterol drug. If your strategy is to get assigned stocks, then the 2.75% dividend yield should be attractive. Basically, I look to dividend paying stocks so we get paid to wait for the market's rebound.

[Image 1]

We are going to sell two of the December 47.5 Puts for a target price of $0.85 per contract. ABT became interesting at the close of Friday because the stock price closed above the 8 day exponential moving average. I have drawn a line at the spike low from 11/21 at $48.24. The technical stop is set at $48.10. The initial margin requirement for two contracts is about $1,100.

Option Writers Newsletter Archives