Last Week's Income Report: August 9th, 2021
The S&P 500 finished last week at its 44th record closing high of the year following the release of stronger-than-expected employment data.
At Options Income Blueprint, we closed four profitable positions last week:
Traders who sold just one contract of each could have earned $154 in cash.
As you can see above, we earned excellent annualized returns on Citigroup (C), Pfizer (PFE) and Walgreens Boots Alliance (WBA). We closed all three positions early, locking in gains and freeing up capital for more trades this week.
But the trade I want to take a closer look at today is actually Marvell Technology Group (MRVL). While our annualized return on this trade was less than 1%, it was a different kind of success story.
We began trading the semiconductor stock in Options Income Blueprint in September of 2020.
Using a mix of puts and covered calls, we traded MRVL successfully four times between then and early 2021, pocketing $369 in cash.
Our next trade on Marvell Technology came in mid-February. With the stock trading at $53.51, we sold a put with a 52.50 strike price, collecting $0.42, or $42 per contract.
As you can see from the chart below, our timing was less than ideal, as MRVL was caught up in the broader tech sector sell-off.
If we had given up early on, we could have booked a loss of up to 24% on the trade.
What’s more, even though we had a paper loss, the options we were selling were generating excellent rates of return on our capital
Sure, we “missed” the runup in MRVL shares off the mid-May lows. But there is no such thing as a foregone profit.
The Options Income Blueprint strategy is a conservative put selling strategy. We generate above-average returns by booking consistent profits and refusing to take unnecessary losses.
And as you can see with MRVL, our strategy works.