Commit To Purchase Best Buy At $20, Earn 5.8%

Investors considering a purchase of Best Buy Inc (NYSE: BBY) shares, but cautious about paying the going market price of $34.47/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 $20 strike, which has a bid at the time of this writing of $1.15. Collecting that bid as the premium represents a 5.8% return against the $20 commitment, or a 4.1% annualized rate of return (at ...