Can a mouthy CEO plump your portfolio? You betcha.
The CEO of United Airlines (UAL) unwisely opened up his mouth, and the stock sold off on Friday, roiling all the airlines.
He mentioned softening travel across the Atlantic and consolidation in the industry, fueling the rumors that UAL might be interested in buying Avianca (AVH).
Some good did come out of his comments: Increased volatility in the airline stocks.
That means increased premiums and more cash for you if you sell puts on most airlines, big or small.
I suggest you look at Delta (DAL).
The stock is grossly undervalued and just bounced off of the $41.50 level.
You can sell a June, Week Two 41.50 put for more than $0.50. Translation: More than 1% in a week if it expires worthless, more than 50% a year on an annualized basis.
Looks like the skies are friendly with United after all.