DraftKings (DKNG)
DKNG continues to be a great addition to the portfolio. We recently locked in 17.1% in options premium and capital gains. Our total return is over 39% since adding the position to the portfolio. Now it’s time to start the income wheel cycle over again by selling puts in DKNG. Hopefully, our good fortune continues.
DKNG is currently trading for 40.33.
Here is the trade:
Sell to Open DKNG March 28, 2024, 38 put for $1.15. (As always, prices will vary, please adjust accordingly.)
Delta of short call: 0.30
Probability of Profit: 64.96%
Probability of Touch: 68.60%
Total net credit: $1.15
Max return (cash-secured): 3.0%
Risk Management
We use DKNG as part of our Income Wheel Portfolio, so if DKNG closes below our put strike at expiration, we will be assigned shares of DKNG (per the guidelines of the strategy). Until that point, we will repeatedly sell puts on DKNG. Of course, any necessary trade alerts/updates will follow.
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