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NorthStar Realty Finance Corp. Message Board

  • eclectic_investor eclectic_investor Apr 7, 2014 2:25 PM Flag

    NRF May short puts

    For income, if you have confidence pre-spinoff, take a look at shorting the May puts. They expire just before the spinoff, ex-div date will be around June 6. I just sold the 16s figuring that if I get the shares it will be at around 14.70 and I'll pick up the June dividend. Just an idea for the believers.

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    • Why not capture the spin-off with June puts? I'm looking for a good re-entry, like your idea, but wonder about a longer date. What do you expect implied vol to do after the event?

      • 1 Reply to lner2512
      • I also sold the June 16 puts today for $1.50 - I am holding a boatload of the stock, never sold a share, and my average price is below $6. I got shares in lieu of cash dividend when, if I recall, they were 2.67 (now adjusted down). This trade was simply in a tax deferred account where I am sitting on cash and I expect to keep the $1.30 for a nice return on the cash. If I do end up taking the shares - see my original post - I am reluctant to go beyond the June expiry as following the division of the company the options will also be adjusted and I don't want to bother thinking about adjusted options.

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