How We Put $456 CASH In Our Pockets From 4 Trades This Week
November 20th, 2020
Traders who sold just one contract of each of these trades could have earned a potential $152 in income.
Since then, we have sold puts on the stock 35 times, and each one of those positions was profitable. Not a single losing trade. If you had sold just one contract of each of the SQ trades, you could have generated $2,524.
It’s probably not surprising that SQ was one of my favorite stocks to trade in 2018 and 2019. So far this year, though, we’ve only traded the stock four times. There’s nothing wrong with SQ, and the $297 in potential income we’ve generated this year is nothing to scoff at.
But shares have run up more than 175% year to date, and with the stock pushing the $200 mark, the cost to secure just one contract is quite high.
When you sell a cash-secured put, you must have enough money in your brokerage account to cover the cost of being assigned 100 shares at the strike price you sold. So, let’s say you sold a 190 strike put on SQ. You would need to put up $19,000 in capital to cover a single contract.
In other words, the high share price can make it difficult for traders who don’t have large accounts to make the trade. That is why we tend to avoid selling puts on high-priced stocks in Options Income Blueprint.
Anyway, back to the point at hand. While SQ was one of my favorite income stocks last year, Corning has been on the top of my list of stocks to trade for 2020.
Corning makes specialty glass, ceramics and related materials used in mobile phones, LCD TVs, notebook computers and flat panel desktop monitors — all products that are in high demand. You might have heard of its Gorilla Glass product, which is an ultra-thin, ultra-durable glass sheet used for display devices such as mobile phones, tablets and notebook PCs.
The company also specializes in technologies, including advanced optics, primarily for industrial and scientific applications. The need for efficient data transfer and networking systems on mobile devices should help drive growth in Corning’s fiber optic solutions business going forward.
What’s more, Corning has entered the race to produce billions of medical-grade vials to hold a coronavirus vaccine. Anticipating a shortage of cold-resistant glass vials to handle a frozen vaccine, the company secured a $204 million contract from the federal government to increase production of its Valor glass vials. It plans to make hundreds of millions of pharmaceutical-grade glass vials next year.
We’ve traded the stock a handful of times over the years, but dramatically picked up the pace in 2020.
Since May, we’ve traded GLW 11 times, racking up 10 winners with one breakeven trade. Below is a rundown of those trades:
Members who sold just one contract of each of these trades could have earned $413 in income in the past seven months from this stock alone.
As you can see, some of the trades were closed after just a few days, resulting in triple-digit annualized rates of return.
Corning is likely to be on more traders’ radar as we get closer to a coronavirus vaccine. I plan to continue trading the stock as long as premiums remain attractive. And I don’t see that changing anytime soon.