No. of Recommendations: 0
a simple options strategy: cash-secured put sales
It's simple ... for you and me. For example, almost all my holding of OXY were purchased via put options that I've sold over the years. BUT, it isn't so simple for Berkshire to do so. That's because the volumes of puts isn't high enough, and if they come in too hard, then it'll immediately affect the stock price. For example, Feb puts only have appreciable volume of 160 42.5 strike, and 310 of the 43.5 strike. That's hardly enough (basically entire volume is 47,000 shares) for Berkshire to even bother with. March isn't much more at 54 of the 40s, and 543 of the 42.5s. April is similar at 87 of the 40s, and 71 of the 42.5s.
Even if you look at total open interest, it still doesn't approach numbers that could move the needle at Berkshire.
Now, that said, I still think it's a very good way for them to slowly collect more shares of things they like at slightly better than market prices. So I would support them doing it.
