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11/25/2023

Updated: Dec 18, 2023

We are continuing our time out on selling put options.  With some option executions in recent months we are now on margin.  Based on the size of our account we have negotiated a favorable margin rate but it is still high compared to a couple of years ago.  IBKR seems to have the best margin rates and we will consider moving away from what was TD Ameritrade and is now Schwab.  We still have substantial real estate holdings and are generally disposing those assets so we expect to infuse new capital into our family asset management business.  But, as we all know  timing with real estate sales is always uncertain.

 

Once our real estate assets are down to a minimal level we will focus more intently on the role of debt in our capital structure and margin rates will be particularly important then.  Any business including our family asset management can have some debt in its capital structure.  But debt is a double edged sword and particularly at today’s interest rates.

 

In the meantime, we will keep debt low and sharpen our selection of Dividend Champions for selling puts once we resume.  We are now discussing changes to our selection criteria.  With December expirations approaching we will have very few puts outstanding and may resume put selling based on some modified criteria.  Watch the daily diary for those criteria.

 

 Of course, we continue to sell calls on those few fallen Dividend Champions like VFC, MCY and T that we still own.  Selling calls we think of as our dairy business.  That’s because it’s just a great way to milk those stocks before they finally get sold.

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