IYR Options

Oct. 15, 2018 11:47 AM ETIYR2 Comments
IndyDoc1 profile picture
IndyDoc1's Blog
Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Contributor Since 2012

self directed investor


  • IYR options.
  • Protection.
  • Dividend capture.

In this hypothetical exercise, I will use IYR as an exercise to demonstrate the feasibility of a hybrid hedging. Will track the results regularly, including adjustments.

The Trade:

Buy 200 shares of IYR ( currently trade at $ 76.41 ). Total $ 15, 282

Sell to open  4 contracts 9th Nov $77.50 Call  at $ 0.89 each. Total $ 356

Buy to open 4 contracts 9th Nov $79 Call at $ 0.36 each. Total $ (-144 )

Buy to open 4 contracts 17th Jan 2020 $79.00 Put at $ 7.65. Total $ (-3060)

Buy to open 2 contracts 9th Nov $73.00 Put at $0.51 each. Total $ (- 102 ).

Sell to open 3 contracts  9th Nov $74.50 Put at $0.78 each. Total $ 234.

The transactions do not include trading fees or account for price friction.

Total credit collected this month is ( 356+234-102-144 = $ 344 ) 

Goal is to pay for the $ 3060 long term put which in addition to the underlying is a bullish position. 

Will update the results on or before November 9th. 

Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in IYR over the next 72 hours.

Recommended For You

Comments (2)

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.