Maximize Gains: Short Occidental Petroleum Options

Why Short Occidental Petroleum?

Shorting Occidental Petroleum (OXY) put options has been a lucrative strategy over the past two months, despite fluctuations in oil prices. As OXY closed at $56.93, the stock has remained relatively flat, presenting an opportunity for investors to capitalize on out-of-the-money (OTM) puts.

Investors can benefit from this strategy by:

• Collecting income from selling OTM puts without needing to own OXY stock.
• Retaining the premium from put options that are unlikely to be exercised.

For instance, shorting the $50 OXY put option yielded a 1.94% return, while more recent options have shown similar potential. With the current market conditions, short-sellers can expect to see premiums drop, enhancing their profit margins as the expiry date approaches. This trend suggests that now might be an ideal time to engage in shorting OXY puts, especially if oil prices continue to rise.