I have been reading your posts for a couple of months now and...

I have been reading your posts for a couple of months now and found some very interesting comments and predictions and I thank you guys for that.

My first purchase of TLS was to fill my boots with them when T3 was offered at the end of 2006 for $3.60 (2.00 + 1.60 in instalments). At the time most brokers were negative on them even though they were giving a 28c dividend plus franking credits for a $2 first instalment which worked out to be a 20% yield including franking credits. They also gave me a bonus 4% of free shares when I held them for about a bout 18 months. I can see I sold out in Aug 2008 at around $4.32.

My second purchase was in May 2011 after the Future Fund stop selling the shit out the stock they received from the government as part of the T3 float. In Jan 2008 I think they were a 15.6% stake holder and by May 2011 it was down to a below 5% stake holder. I think I averaged buying around the $3.00 and sold out at $6.20 on the 20th may 2015 and at $5.33 on the 5^th Nov 2015. With hindsight and brains I should have obviously gone short then and I missed the boat bigtime!

Last week I made my 3^rd venture into the stock. I bought 400,000 (all of my SMSF) at an average $3.50 and bought the equivalent March 2019 put options at an average cost price of 32c for protection. I don’t believe this is the bottom of share price but believe the stock is cheap and they will go up within the next 12 months. I will now lay back and relax and wait until March 2019 and let you guys know if I was right. In the meantime I will collect 3 dividend payments of 11c + franking credits, all up worth a total of 47c to me over the 18 months. So even if they stay here or do go down I still make 5c on them. If the really unexpected happened with the share price and it collapsed to say $2.60 in 18 months I would then exercise my put options and then have 1,360k in cash + 188k collected in dividends (with franking) and then be able to buy nearly 600,000 TLS but I think I am dreaming on that one!

This strategy is not a recommendation but suits me at this moment in time as I don’t have the balls to go long without protection.

I think Telstra is a great Australian company and will still be the biggest and best player in the telecommunications market for the foreseeable future as demand for connectivity grows beyond to what we can now imagine. Cutting the dividend was correct IMO and gives the company a new low base to start from and when they can get a few runs on the board the dividends will start to go back up. Lastly I would like to add that Penn does worry me but agree with a few of you who think he should be given a bit more time to prove himself. However I would not be disappointed if they got someone else perhaps like a Sol Trujillo who streamlined the business and saw where the future was and invested heavily in 3G and made some very profitable Chinese investments (I am not convinced Penn could do that).