June 10, 2018

Options Backtesting Results

Historical average return: +$1,013.77 (backtested over 2.6 years)
Historical success probability: 94.2%

Summary

It seems unlikely that Facebook's new dating feature will dent Match Group's empire in only a few months. This is why we think short-term put writing on Match (MTCH) is an unusual bright spot in today's market. Selling 10% out of the money puts will collect 6% of the underlying price with a 94% backtested historical success probability. The downside risk of purchasing shares at a cost basis of 16% below the current market price is also an attractive prospect but is only a 6% historical chance.

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