Market Shadows Virtual Put Selling portfolio shorted (sold) 2 contracts of the Potash Corp. (POT) Jan. 2016, $35 strike price puts for $7.00 per share.
Our maximum profit will be realized if POT rises to $35 or higher before the Jan. 15, 2016 expiration date. In the (unlikely) event that POT remains below $35 for the next two years we are committed to buying 200 shares. Our net cost would be $28.00 each ($35 strike price less the $7 put premium per share).
The absolute low price for POT since late 2009? Exactly $28.00 back in 2010 when EPS were lower than today.
The yearly dividend rate was $0.13 back then versus an annual rate of $1.40 at present ( a 4.28% yield @ $32.67 and 5.0% at our break-even price).
