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Kraft Foods Inc.  
About The Company
Market Cap 54.2B
Revenue (FYR) $49.2B
EPS (TTM) $1.42
Shares Out. 1.7B
Book Value $20.50
Div/Share $1.16
Payout Ratio 82x
P/E 21.8x
Price/Sales (FYR) 1.1
P/Cash Flow (TTM) 13.8x
Profit Margin 5.07%
Debt To Capital 44.42%

Kraft Foods Inc is a profitable Food Processing company that trades on the NYSE. Kraft Foods Inc. (Kraft) is engaged in manufacturing and marketing packaged food products, including snacks, beverages, cheese, convenient meals and various packaged grocery products. The Company has operations in more than 70 countries and sell the products in approximately 150 countries. The Company manages and operates, through three commercial units: Kraft Foods North America, Kraft Foods Europe and Kraft Foods Developing Markets. In Feb 2010, Kraft completed its acquisition of Cadbury.The brands of the Company span five consumer sectors: snacks, beverages, cheese, grocery and convenient meals.

 

 

 
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  KRAFT FOODS INC  (KFT) - 2011
ONGOING EVALUATION & TRADE
This is a non-retirement account. I am selling naked puts against the stock.
This trade started in October 2008 and by June 2010 I had made enough income to pay for 500 shares of Kraft. Rather than accept assignment I am continuing to sell naked puts until eventually assigned as Kraft remains in a tight trading range making the selling of options viable. The goal was to own shares of Kraft through other people's capital. This goal has been realized. The objective now is to add to that income until eventually assigned shares.
KRAFT TRADES BY YEARS
VIEW KFT-2011 TRADES
VIEW KFT-2010 TRADES
VIEW KFT-2009 TRADES
VIEW KFT-2008 TRADES
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CURRENT U.S.
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AT+T
CLOROX
COCA COLA
INTEL CORPORATION
JOHNSON & JOHNSON
KRAFT FOODS
MCDONALDS
MERCK & COMPANY
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NUCOR CORPORATION
PEPSICO
SPYDER ETF
VISA
EXXON MOBIL
YUM! BRANDS

 
Should you find my strategy and ongoing evaluation of this trade of value I hope you will consider a tip for the time I spend detailing out this trade. I have set up a Paypal account for those who would like to donate. Thank you in advance. Remember, nothing on my site is financial advice. They are just my ideas and opinions. Investing is risky and losses can be large. Trade at your own risk. Read the terms of use
YEAR 1: 2008 - Trade Commenced Oct 2008
Goal for 2008: 2% (2 months)
Strategy: Sell Naked Puts Until Assigned
 
Capital In Use At End Of 2008 13,000.00
Income Earned in 2008 (2 months) 785.25
Return On Capital in 2008 (2 months) 6%
   
YEAR 2: 2009
Goal for 2009: 12%
Strategy: Sell Naked Puts Until Assigned
 
Capital In Use At End Of 2009 25,500.00
Income Earned in 2009 5,265.50
Return On Capital For 2009 20.10%
   
YEAR 3: 2010
Goal for 2010: 12%
Strategy: Sell Naked Puts Until Assigned
BY JUNE 2010 NO MORE CAPITAL IS REQUIRED AS THE STRATEGY HAS SUCCEEDED AND ALL THE CAPITAL REQUIRED IS THAT OF OTHER PEOPLE'S MONEY
 
Capital In Use At End Of 2010 14,500.00
Income Earned in 2010 9901.50
Return On Capital For 2010 68.28%
   
YEAR 4: 2011
Goal for 2011: 12%
Strategy: Sell Naked Puts Until Assigned
 
Capital Currently In Use 33019.25
Income Earned in 2011 2633.75
TOTAL INCOME EARNED TO DATE 17800.75
Total Of My Own Capital Required 15218.75
Number Of Shares if assigned 1000
Share Price Valuation
(Total Capital Required/Number of shares)
15.22
TRADE COMMENCED Oct 6 2008
GOAL FOR 2011: 12%

ONGOING STRATEGY - SELLING NAKED PUTS UNTIL ASSIGNED
* ACTIVE TRADES ARE HIGHLIGHTED IN YELLOW

 

Jan 3 11 31.67 BTC 5 NP JAN 29 @ .05       13.25     (38.25) 15914.00
Jan 10 11 30.97 STO 5 NP FEB 30 @ .44 1.4     13.25     206.75 16120.75
Jan 21 2011: FLATLINE: Since early December the stock has almost flatlined. But if I look careful I can see that since the end of December the stock is clinging more to the lower Bollinger than the Upper. This is telling me that the next move may be lower for Kraft. It;s worth waiting a few days before selling more naked puts.

Jan 21 11 31.35 Expiry 5 NP Jan 30 expired               16120.75
Jan 27 2011: Here I am just a few sessions later and the stock has fallen. I could wait but Kraft tends to stay in a range. If I sell the March $30 put today I will get a great return as I am going out almost two months. Meanwhile if the stock falls further I am comfortable know that it will probably stay within it's normal range. Therefore if it should fall below $30.00 I can consider selling 5 more puts to $29.00 and holding onto the $30.00 as the stock will probably trend around that level.

Jan 27 11 30.65 STO 5 Naked Puts Mar 30 @ .62 2.0%     13.25     296.75 16417.50
Feb 11 2011: The stock took a bit of a tumble today and is reaching into the low end of its range. I have a large margin available for this stock so even though I am hold Feb 30 naked puts, I am selling in Apr 29 for more income. It's comforting to have a good chart to fall back on and keep watching. Kraft keeps a tight range and I see not cause for concern.

Feb 11 11 30.35 STO 5 Naked Puts Mar 29 @ .57 1.96     13.25     271.75 16689.25
Feb 18 11 32.92 Expiry: 5 Naked Puts Feb 30 expired                
Feb 18 2011: Expiry today.  As I know this stock stays in a trading range I can select to sell the $30 strike for Mar or go to $29.00 for April since I am already holding Mar 30 and 29 puts at this point.

Feb 18 11 30.75 STO 5 Naked Puts Apr $29 @ .42 1.4%     13.25     196.75 16886.00
Mar 18 11 30.99 Expiry: 5 Naked Puts Mar 30 expired
5 Naked Puts Mar 29 expired
               
Mar 21 11 30.50 STO 5 Naked Puts Apr 30 @ .47 1.5%     13.25     221.75 17107.75
Mar 30 11 31.49 BTC 5 Naked Puts Apr 30 @ .04       13.25     (33.25) 17074.50
Mar 30 11 31.49 BTC 5 Naked Puts Apr 29 @ .03
COMMENTS: CLOSED both positions. As per my strategy of the cautious bull, it is worth closing these naked puts early when I am able to do wo for pennies. Presently I will wait to see if the stock pulls back over the next week or so and then sell naked puts again.
      13.25     (28.25) 17046.25
Sep 6 11 33.7- Sold 5 Naked Puts Oct $32 @ .58 1.7%     13.25   16013.25 276.75 17323.00
Oct 21 11 35.20 Expiry: 5 Naked Puts Oct $32 expired                
Oct 25 11 34.91 Sold 5 Naked Puts Nov $33 for .25 0.75%     13.25   16513.25 111.75 17434.75
Nov 9 11 34.65 Sold 6 Naked Puts Dec $30 for .20 0.66%     14.50   18014.50 105.50 17540.25
Dec 16 11 36.49 Expiry: 6 naked puts Dec $30 expired                
Dec 19 11 36.25 Sold 10 Naked Puts Feb 33 @ .28 0.80%     19.50   33019.50 260.50 17800.75
KRAFT TRADES BY YEARS
VIEW KFT-2011 TRADES
VIEW KFT-2010 TRADES
VIEW KFT-2009 TRADES
VIEW KFT-2008 TRADES

 

 

Disclaimer: There are considerable risks involved in all investment strategies. Trade at your own risk.
Stocks, options and investing are risky and can result in considerable losses. None of the strategies, stocks or information discussed or presented are financial advice, trading advice or recommendations. Fullyinformed.com is a private website. Everything presented and discussed are the author's ideas and opinions only.
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