MO : Dividend ArbitrageAltria Group, Inc.BATS:MOFRED-RABEMANThe following is intended for educational purposes for those interested in neutral strategies (regardless of the behaviour of the stock) involving options Today I executed this promising following dividend arbitrage. STOCK : MO (Altria) Ex Date : March 25 Dividend Expected : $1.06 STRATEGY : CONVERSION meaning 1 COMBO LONG : Buying 100 shares of MO SHORT SYNTHETIC FUTURE : Selling 1 MO Call 61 Expiring on March 27 Buying 1 MO Put 61 Expiring on March 27 DELTA = 0 EXECUTION 2850 COMBOS Margin required $78,417 BOT 285,000 MO @ $64.383 average SLD 2850 Calls @ $ 3.011 average BOT 2850 Puts @ $ 0.243 average EXPECTED Dividend : $302,100 LOSS from Exercise : -$175,275 Profit Before Tax, Commissions and Interests : $126,825 Estimated Commissions and Interests : -$14,402.86 Assuming 30% TAX at source (US Taxpayers) Tax : -$90,630 Profit after Tax : $21,792.14 Performance on margin : 27.79% As a result my overall account will grow by 1.29% this week. Assuming 40 trades per year, performance would be 67%