Someone's willing to pay ~$1,150 to let me buy $MRVL at $150 by Jan 15. That's a cash-secured put, and the setup is wild right now.
Here's the trade: $MRVL is around $166. Sell one $150 put expiring Jan 15, collect ~$11.50/share ($1,150 total). Park $15k in cash in case you get assigned.
Two outcomes at expiration:
1. $MRVL stays above $150 → put expires worthless, you keep the full $1,150. That's a 7.7% return on cash in ~9 weeks.
2. $MRVL drops below $150 → you buy 100 shares at $150, but your real cost basis is $138.50 after the premium. That's ~16% below today's price.
Why is the premium this fat? Volatility. $MRVL got hammered on the all-stock Lumentum deal (announced Nov 2), and IV is sitting at ~71%.
The catch: $MRVL reports Dec 1, before expiration. If it closes under $138.50, you're holding shares at a loss. Only sell puts on names you actually want to own at that strike.
Not advice. Just showing how the mechanics work when vol spikes.
Here's the trade: $MRVL is around $166. Sell one $150 put expiring Jan 15, collect ~$11.50/share ($1,150 total). Park $15k in cash in case you get assigned.
Two outcomes at expiration:
1. $MRVL stays above $150 → put expires worthless, you keep the full $1,150. That's a 7.7% return on cash in ~9 weeks.
2. $MRVL drops below $150 → you buy 100 shares at $150, but your real cost basis is $138.50 after the premium. That's ~16% below today's price.
Why is the premium this fat? Volatility. $MRVL got hammered on the all-stock Lumentum deal (announced Nov 2), and IV is sitting at ~71%.
The catch: $MRVL reports Dec 1, before expiration. If it closes under $138.50, you're holding shares at a loss. Only sell puts on names you actually want to own at that strike.
Not advice. Just showing how the mechanics work when vol spikes.