Those of you that actually read my stock-related posts know that I recently dumped Broadcom (BRCM) in the $31's, and I did mention I might be selling BRCM puts if the stock were to fall. Today, that's what it did due to a downgrade by Amtech and also poor guidance from Marvell Technology (MRVL). So today, I did end up selling some puts... details below.
Sold October $30 BRCM Puts (RCQVF) for $1.80. I could have gotten $2 or more earlier in the day, but I didn't pull the trigger. These puts are uncovered (I'm not short any BRCM). But, they are covered by cash... if you're interested, you can read more about a cash-secured put option strategy.
In summary, if BRCM is $30 or higher on Oct 20 (expiration date), then I pocket the $1.80 per share. If BRCM is less than $30, then I will be buying the shares for $30, giving me an effective cost basis of $28.20.
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