Look to execute a covered call write on the Sohu Sep 70. I'm looking at the underlying at about 72.50 and the bid of the Sep 70 at about $.90. Total investment should be about $6760. Total profit if unchanged will be about $480 which is a 7.36% return to expiration which translates to 61.64% annualized. There is 10.07% downside protection.
The key, as always, is to get the trend of the underlying instrument correct. In this case, Sohu has passed our strict fundamental criteria. I wouldn't initiate the covered call write until we see some strength in the SOHU stock. Right now, it is drifting lower. Still, this is a strong candidate for purchase! Watch it closely!
It's 1987, 21 years ago, and John Wiley & Sons has just published my new book, Option Strategies. I never would have imagined that it would still be in print 21 years later and be into it's third edition.
The book has new chapters and every chapter has been re-written. I've really extended the chapter on selecting a strategy.