DGI Adventure 11-21-16 Sold Cash Secured Put – Visa Inc. (V) – $76.00 strike – Dec 09 Expiration

This trade was actually executed on Monday 11/14/16. I didn’t get a chance to write about it until today.

I already went through my investment thesis process back in July when I first opened a position, so I won’t be rehashing all that here. The point of this post is really just to document the trade.

I have updated the portfolio and income tracker back at the mothership to reflect this position.

Dividend Cycle

V went ex-dividend shortly after this trade was executed (Wednesday 11/16). Thanks to raising its annual dividends for nine consecutive years, Visa is a dividend challenger. This quarter’s distribution is $0.165/share, which is a $0.025/share (17.9%) increase over the previous.

Of course the premium received for this trade represents over a year’s worth of dividends at the new rate, so I’m not too disappointed that I missed this quarter’s payout.

Investment

SPL (Strike Price Logic)

I’ve said it before and I’ll say it again: I think Visa is an outright buy under $80/share. It’s probably pretty fairly valued up to the mid-$80’s.

So $76 sounds perfectly fine to me.

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