Investors eyeing a purchase of Threshold Pharmaceuticals Inc (THLD) stock, but cautious about paying the going market price of $5.51/share, might benefit from considering selling puts among the alternative strategies at their disposal. One interesting put contract in particular, is the January 2015 put at the $2.50 strike, which has a bid at the time of this writing of 40 cents. Collecting that bid as the premium represents a 16% return against the $2.50 commitment, or a 9.7% annualized rate of return (at Stock Options Channel we call this the YieldBoost).
Commit To Buy Threshold Pharmaceuticals At $2.50, Earn 16%
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