Naked Put on Deutsche Bank (FRA:DBK) - Potential income return 3.17% in 39 days (28.53% annualized)

On October 12, 2020, we sold 1 naked put on Deutsche Bank (FRA:DBK)) stock expiring on November 20, 2020. For this trade, we got a EUR 24 premium (before commissions).

Deutsche Bank AG is a German multinational investment bank and financial services company headquartered in Frankfurt, Germany, and dual-listed in New York Stock Exchange and Frankfurt Stock Exchange. The bank's network spans 58 countries with a large presence in Europe, the Americas and Asia.

This trade comes as the #11 in the month of October, according to our trading plan for this month, the premium generated from this trade makes us about 3.86% from our $600 monthly goal, while in total we have already reached 22.64% so far.

We call these trades naked because we are trading on margin, in case of an assignment we will borrow funds from the broker to finance the purchase. 

here is our trade setup:

  • SLD 1 DBK NOV 20 '20 7.3 Put Option 0.24 EUR

what can happen next:

DBL is trading above our strike price of EUR 7.3 at expiry date (November 20, 2020), in such case, we keep the premium and probably sell more naked puts to generate additional income. Our max gain is realized in this situatio EUR 23.21, or 3.17% potential income in 39 days if the option contract expires worthless.

In case DBK is trading below our strike price of 7.3, we get assigned 100 shares of DBK at price EUR 7.3 per share. 

Break-even: EUR 7.07

Selling naked puts with FRA:DBK stock
Selling naked puts with FRA:DBK stock
  • Running Total  4 Trades since September 21, 2020

  • Options income: EUR 55