Locking In Option ‘Income’ With AT&T

Summary:

• With the latest weekly options expiration, we have our short puts on AT&T expiring worthless, though this trade started out as a short strangle.
• Positive buyback news from AT&T’s investor day boosted shares, prompting a roll of the covered call leg to capture more premium and the upcoming potential dividend.
• AT&T’s valuation appears rich as shares power higher this year; even with management’s optimistic tone about “accelerated growth,” the numbers didn’t meet analyst consensus.

Written by Nick Ackerman

We had another rather successful option writing trade come to a close with AT&T (NYSE:T) for the weekly December 6 expiration. What initially began as another round of short strangles on the name ended with

Analyst’s Disclosure: I/we have a beneficial long position in the shares of T either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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