Looking back to 69 days ago, Access Midstream Partners LP (ACMP) priced a 8,000,000 share secondary stock offering at $46.47 per share. Buyers in that offering made a considerable investment into the company, expecting that their investment would go up over the course of time and based on early trading on Monday, the stock is now 7.2% above the offering price.Investors who did not participate in the offering but would be a buyer of ACMP at a cheaper price, might benefit from considering selling puts among the alternative strategies at their disposal. One interesting put contract in particular, is the June 2014 put at the $45 strike, which has a bid at the time of this writing of $1.75. That would result in a cost basis of $43.25 per share before broker commissions in the scenario where the contract is exercised. If the contract is never exercised, the put seller would still keep the premium, which represents a 3.9% return against the $45.00 purchase commitment, or a 5.8% annualized rate of return (at Stock Options Channel we call this the YieldBoost).
If You Would Buy ACMP At $45, Here's An Options Strategy For You
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