Shorted Some HSII Puts Today
By Dr. Paul Price of Market Shadows
We sold six contracts of Heidrick & Struggles (HSII) Jan. $17.50 puts at a price of $1.60 per share in our Virtual Put Writing Portfolio.
Our commitment is to be ready to purchase 600 HSII shares at a net cost of $15.90 per share ($17.50 strike price – $1.60 put premium). The best-case scenario will occur if HSII remains above $17.50 on the January 17, 2015, expiration date. We will then keep 100% of the $960 we received for selling these options.
Heidrick & Struggles has spent very little time under our break-even point during the last 12-months and none at all since the worst of the market's selloff in early February.
HSII is net debt-free (treasury cash exceeds total debt). It pays a secure, 13-cent, quarterly dividend which would yield 3.27% at our 'if exercised' price.
The trade is now reflected as an open position in our Virtual Put Writing Portfolio.
