This week we were able to hit the profit target on our NAB Bull Put Spread, entered on 11th Dec. This trade was entered by selling the 33.50 Jan Puts and buying the 32.50 Jan Puts, collecting an overall gross credit on the trade of 40.5c. This meant that at best, we stood to make a max profit from the trade of $40.5 per contract, risking a maximum of $59.50 per contract before costs.
As seen above, NAB performed ideally for us, rallying not long after entering the trade. This week time decay really started to kick in on the options, allowing us to close the trade at our predetermined profit target of 5c buy back cost on Thursday 23rd Jan.
After holding the trade for 33 days, we realised a gross gain of $35.5 per contract for a 59.6% gross yield on the trade. Furthermore, the trade was closed a full week before Jan options expiration, removing the risk that NAB could have fallen away during the last week in the trade.