Commit To Purchase WellCare Health Plans At $40, Earn 7.8%

Investors eyeing a purchase of WellCare Health Plans Inc (NYSE: WCG) stock, but cautious about paying the going market price of $55.92/share, might benefit from considering selling puts among the alternative strategies at their disposal. One interesting put contract in particular, is the January 2015 put at the $40 strike, which has a bid at the time of this writing of $3.10. Collecting that bid as the premium represents a 7.8% return against the $40 commitment, or a 5% annualized rate of return...