Brutus Options Ranker Template: Short Put Strategy

Brutus Options Ranker Template Short Put Strategy on Dividend Dominators

Below you will see full details on this strategy that is now available in the Brutus Options Ranker.

You can easily clone this template into your account. After cloning the strategy, you can customize it to your liking and re-weight the criteria to match your trading objectives.

Short Put Strategy on Dividend Dominators Weight to Customize

By OptionAutomator

This is a great full strategy that looks to write short puts on great dividend paying stocks. This allows the trader to collect premiums as well as dividends in the event they get assigned the underlying stock.

Template type :

Template objective :

This strategy looks to sell either naked or cash-secured puts on high performing dividend stocks. This is a fairly conservative strategy, as the assignment risk taken by the trader allows the trader to pick up the stock at a discounted price and therefore increase dividend yield, provided the dividend payout remains constant.

Assumption :

Slightly Bullish

Event Driven :

Event Neutral

Net short or net long options :

Short Options Strategy (credit is collected at entry)

Compatible setups :

This strategy is designed around short put selling.

Suggested market groups :

Use this strategy with high dividend-paying stocks: 1. Dividend Aristocrats 2. Dividend Domination

Prerequisites :

The trader should be familiar with short put selling. Check the "view details" on the put selling setup for more information.

When to take profits :

A good rule of thumb is to take profits at 50% of the credit received. E.g., if the put is sold for $1.00 then the trader may buy back the short put(s) at $0.50. A variation is when the trader is comfortable to take the stock if assigned due to the higher yield. In this case, the trader should hold the position to expiration for a potential max profit.

Managing a losing trade :

This strategy works well with a 'down and out' trade management strategy. Alternatively, the trader may choose to hold to expiration and take the assigned stock at a reduced cost basis.

Additional trade management details :

Tags: Brutus Options Ranker Strategy Template

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Short Put Strategy on Dividend Domination

Brutus Options Ranker Template Short Put Strategy on Dividend Dominators