Amgen: Cash Secured Puts

April 26, I am going to open a position on AMGEN.  According to Mornigstar valuation, AMGN is trading about 12% under is fair value ($205).

I start with my usual preliminary analysis just to see where buyers and sellers place their trades.

Open Interest Chart

OTM call @185 (potential resistance) ; OTM put @180 and 175 (potential support)

As usual I’ll try to stay 1 STD.

Option Volume Chart

Good volume @175 but over my STD. I am going to find my strike at 172.5 or at 170 ( more conservative).Premium are high in both strike.

Max Pain @180

Conclusion : sold 1 CSP , strike 170@0.95 . Expiry May 3 . Weekly return 0.55% AROI 28%.

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