Near the end of trading yesterday, 12/17/09, I STO 2 BAC Jan10 15 Puts for a net deposit of 120.49 in an IRA account.  My basis for these BAC shares would be 14.40 if put to me.

This transaction represents a 3.8% raw return or 48.82% annualized, on the strike price.  BAC currently pays only a .01 quarterly dividend, down from .64 in Sep 2008.  I fully expect the dividend to be raised, if not in 2010, then during 2011, although probably not to it former level.

I already own 500 BAC shares in this same IRA account with Jan10 17.50 Covered Calls sold against them.  My basis for the 500 shares is 23.12.  I would actually like to have the two new Puts assigned to me which will allow me to average down with the existing 500 shares that I own.  However, I suspect that these Puts will expire worthless in January.