Subject: Cash covered PUTS on UPST
Looking at these today, there seems to be some rather juicy returns, especially if one believes that UPST is still likely to climb:
Date Strike %ITM Cash Req'd Target %return Annualized Income/Contract Days to Go UPST FOMO
Jun-23 30.5 0.03% $ 28.40 $ 2.10 7.39% 1251.53% $ 210.00 10 32.6
Jul-23 30 1.67% $ 26.10 $ 3.90 14.94% 209.43% $ 390.00 45 33.9
Aug-23 30 1.67% $ 24.20 $ 5.80 23.97% 192.77% $ 580.00 73 35.8
The July 30 PUTS seem like a rather interesting proposition, buying UPST at 26.10 if the price drops below that, or getting 15% (absolute) on your money to hold it for 45 days. UPST has to climb above 34 for you to have done better with the stock. Note also that if UPST keeps climbing, you would be able to buy them back at a significant discount.
What do you guys think?
--G