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Monday, March 24, 2008

Boeing, Celanese, Disney, Frontier Oil, Humana, MSCI South Korea Index ETF, Mylan, and Seagate Technology -- Continuation Transactions

1. Boeing (BA) Continuation Transaction

The following transaction was made today to establish a covered calls position against the 200 shares of BA:
03/24/08 Covered Calls Transaction -- STO 2 Apr08 80 Calls @ $.85

The Transactions History to date is as follows:
02/20/08 Initial Stock Purchase Transaction -- Bought 200 BA @ $84.35
02/20/08 Initial Sold Calls Transaction -- Sold 2 BA Mar08 85 Calls @ $2.40
03/22/08 Mar08 Options Expired
03/24/08 Covered Calls Continuation Transaction -- Sold 2 Apr08 80 Calls @ $.85
Note: Price of BA was $75.40 when calls were written today.


The overall performance results(including commissions)for the BA transactions through the Apr08 expiration would be as follows:
Stock Purchase Cost: $16,879.95
($84.35*200+$9.95 commission)

Net Profit:
(a) Options Income: $627.10 (200*$2.40 + 200*$.85 - 2*$11.45 commissions)
(b) Dividend Income: $0
(c) Capital Appreciation (If stock price unchanged from $75.40): -$1,809.90
= ($75.40-$84.35)*200 - 2*$9.95 commissions
(c) Capital Appreciation (If exercised): -$889.90
= ($80.00-$84.35)*200 - 2*$9.95 commissions

Total Net Profit(If stock price unchanged at $75.40): -$1,182.80
= ($627.10+$0-$1,809.90)
Total Net Profit(If stock price exercised at $80.00): -$262.80
= ($627.10+$0-$889.90)


Annualized Return If Unchanged (ARIU) -43.3% (-$1,182.80/$16,879.95)*(365/59)
Annualized Return If Exercised (ARIE) -9.6% (-$262.80/$16,879.95)*(365/59)



2. Celanese (CE) Continuation Transaction

The following transaction was made today to establish a covered calls position against the 300 shares of CE:
03/24/08 Covered Calls Transaction -- STO 3 Apr08 40 Calls @ $1.70

The Transactions History to date is as follows:
02/22/08 Initial Stock Purchase Transaction -- Bought 300 CE @ $40.62
02/22/08 Initial Calls Sold Transaction -- Sold 3 CE Mar08 40 Calls @ $1.95
03/22/08 Mar08 Options Expired
03/24/08 Covered Calls Continuation Transaction -- Sold 3 Apr08 40 Calls @ $1.70
Note: Price of CE was $38.90 when calls were written today.


The overall performance results(including commissions)for the CE transactions through the Apr08 expiration would be as follows:
Stock Purchase Cost: $12,195.95
($40.62*300+$9.95 commission)

Net Profit:
(a) Options Income: $1,070.60 (300*$1.95 + 300*$1.70 - 2*$12.20 commissions)
(b) Dividend Income: $0
(c) Capital Appreciation (If stock price unchanged from $38.90): -$535.90
= ($38.90-$40.62)*300 - 2*$9.95 commissions
(c) Capital Appreciation (If exercised): -$205.90
= ($40.00-$40.62)*300 - 2*$9.95 commissions

Total Net Profit(If stock price unchanged at $38.90): +$534.70
= ($1,070.60+$0-$535.90)
Total Net Profit(If stock price exercised at $40.00): +$864.70
= ($1,070.60+$0-$205.90)


Annualized Return If Unchanged (ARIU) +28.1% (+$534.70/$12,195.95)*(365/57 days)
Annualized Return If Exercised (ARIE) +45.4% (+$864.70/$12,195.95)*(365/57 days)


3. Disney (DIS) Continuation Transaction

The following transaction was made today to establish a covered calls position against the 600 shares of DIS:
03/24/08 Covered Calls Transaction -- STO 6 Apr08 32.5 Calls @ $.65

The Transactions History to date is as follows:
02/20/08 Initial Stock Purchase Transaction -- Bought 600 DIS @ $32.09
02/20/08 Initial Calls Sold Transaction -- Sold 6 DIS Mar08 32.5 Calls @ $.80
03/22/08 Mar08 Options Expired
03/24/08 Covered Calls Continuation Transaction -- Sold 6 Apr08 32.5 Calls @ $.65
Note: Price of DIS was $31.85 when calls were written today.

The overall performance results(including commissions)for the DIS transactions through the Apr08 expiration would be as follows:
Stock Purchase Cost: $19,263.95
($32.09*600+$9.95 commission)

Net Profit:
(a) Options Income: $841.10 (600*$.80 + 600*$.65 - 2*$14.45 commissions)
(b) Dividend Income: $0
(c) Capital Appreciation (If stock price unchanged from $31.85): -$163.90
= ($31.85-$32.09)*600 - 2*$9.95 commissions
(c) Capital Appreciation (If exercised): +$226.10
= ($32.50-$32.09)*600 - 2*$9.95 commissions

Total Net Profit(If stock price unchanged at $31.85): +$677.20
= ($841.10+$0-$163.90)
Total Net Profit(If stock price exercised at $32.50): +$1,067.20
= ($841.10+$0+$226.10)


Annualized Return If Unchanged (ARIU) +21.7% (+$677.20/$19,263.95)*(365/59 days)
Annualized Return If Exercised (ARIE) +34.3% (+$1,067.20/$19,263.95)*(365/59 days)


4. Frontier Oil (FTO) Continuation Transaction

The following transaction was made today to establish a covered calls position against the 500 shares of FTO:
03/24/08 Covered Calls Transaction -- STO 5 Apr08 30 Calls @ $1.45

The Transactions History to date is as follows:
02/20/08 Initial Stock Purchase Transaction -- Bought 500 FTO @ $37.60
02/20/08 Initial Calls Sold Transaction -- Sold 5 FTO Mar08 40 Calls @ $1.35
03/22/08 Mar08 Options Expired
03/24/08 Covered Calls Continuation Transaction -- Sold 5 Apr08 30 Calls @ $1.45
Note: Price of FTO was $28.85 when the calls were sold today.

The overall performance results(including commissions)for the FTO transactions through the Apr08 expiration would be as follows:
Stock Purchase Cost: $18,809.95
($37.60*500+$9.95 commission)

Net Profit:
(a) Options Income: $1,372.60 (500*$1.35 + 500*$1.45 - 2*$13.70 commissions)
(b) Dividend Income: $0
(c) Capital Appreciation (If stock price unchanged from $28.85): -$4,394.90
= ($28.85-$37.60)*500 - 2*$9.95 commissions
(c) Capital Appreciation (If exercised): -$3,819.90
= ($30.00-$37.60)*600 - 2*$9.95 commissions

Total Net Profit(If stock price unchanged at $28.85): -$3,022.30
= ($1,372.60+$0-$4,394.90)
Total Net Profit(If stock price exercised at $30.00): -$2,447.30
= ($1,372.60+$0-$3,819.90)


Annualized Return If Unchanged (ARIU) -99.4% (-$3,022.30/$18,809.95)*(365/59 days)
Annualized Return If Exercised (ARIE) -80.5% (-$2,447.30/$18,809.95)*(365/59 days)


5. Humana (HUM) Continuation Transaction

The following transaction was made today to establish a covered calls position against the 200 shares of HUM:
03/24/08 Covered Calls Transaction -- STO 5 Apr08 50 Calls @ $1.25

The Transactions History to date is as follows:
02/20/08 Initial Stock Purchase Transaction -- Bought 200 HUM @ $68.65
02/20/08 Initial Calls Sold Transaction -- Sold 2 HUM Mar08 70 Calls @ $2.20
03/22/08 Mar08 Options Expired
03/24/08 Covered Calls Continuation Transaction -- Sold 2 Apr08 50 Calls @ $1.25
Note: Price of HUM was $46.10 when the calls were sold today.

The overall performance results(including commissions)for the HUM transactions through the Apr08 expiration would be as follows:

Stock Purchase Cost: $13,739.95
($68.65*200+$9.95 commission)

Net Profit:
(a) Options Income: $667.10 (200*$2.20 + 200*$1.25 - 2*$11.45 commissions)
(b) Dividend Income: $0
(c) Capital Appreciation (If stock price unchanged from $46.10): -$4,529.90
= ($46.10-$68.65)*200 - 2*$9.95 commissions
(c) Capital Appreciation (If exercised): -$3,749.90
= ($50.00-$68.65)*200 - 2*$9.95 commissions

Total Net Profit(If stock price unchanged at $46.10): -$3,862.80
= ($667.10+$0-$4,529.90)
Total Net Profit(If stock price exercised at $50.00): -$3,082.80
= ($667.10+$0-$3,749.90)


Annualized Return If Unchanged (ARIU) -173.9% (-$3,862.80/$13,739.95)*(365/59 days)
Annualized Return If Exercised (ARIE) -138.8% (-$3,082.80/$13,739.95)*(365/59 days)


6. MSCI South Korea Index ETF (EWY) Continuation Transaction

The following transaction was made today to establish a covered calls position against the 600 shares of EWY:
03/24/08 Covered Calls Transaction -- STO 6 Apr08 57 Calls @ $1.10

The Transactions History to date is as follows:

11/28/07 Initial Stock Purchase Transaction -- Bought 800 EWY @ $65.22
11/28/07 Initial Calls Sold Transaction -- Sold 8 EWY Dec07 68 Calls @ $1.75
12/15/07 Dec07 Options Expiration Date – EWY closed below the strike price
12/24/07 Ex-Dividend Date $.369 * 800 shares
01/25/08 Covered Calls Continuation Transaction -- STO 8 Feb08 62 Calls @ $1.00
02/16/08 Feb08 Expiration Date -- EWY closed below the strike price
02/19/08 Covered Calls Continuation Transaction -- STO 8 Mar08 63 Calls @ $.80
03/22/08 Mar08 Expiration Date -- EWY closed below the strike price
3/24/08 Ex-Dividend Date $.369 * 800 shares
3/24/08 Covered Calls Continuation Transaction -- STO 8 Apr08 57 Calls @ $1.10
Note: Price of EWY was $54.75 when the calls were sold today.

The overall performance results(including commissions)for the EWY transactions through the Apr08 expiration would be as follows:
Stock Purchase Cost: $52,185.95
($65.22*800+$9.95 commission)

Net Profit:
(a) Options Income: +$3,656.20 [800*($1.75+$1.00+$.80+$1.10) - 4*$15.95 commissions]
(b) Dividend Income: +$590.40 (800*$.369+ 800*$.369)
(c) Capital Appreciation (If stock price unchanged from $54.75): -$8,395.90
= ($54.75-$65.22)*800 - 2*$9.95 commissions
(c) Capital Appreciation (If exercised): -$6,595.90
= ($57.00-$65.22)*800 - 2*$9.95 commissions

Total Net Profit(If stock price unchanged at $54.75): -$4,149.30
= (+$3,656.20 +$590.40 -$8,395.90)
Total Net Profit(If stock price exercised at $63.00): -$2,349.30
= (+$3,656.20 +$590.40 -$6,595.90)


Annualized Return If Unchanged (ARIU) -20.3%
(-$4,149.30/$52,185.95)*(365/143)
Annualized Return If Exercised (ARIE) -11.5%
(-$2,349.30/$52,185.95)*(365/143)


7. Mylan (MYL) Continuation Transaction

The following transaction was made today to establish a covered calls position against the 800 shares of MYL:
03/24/08 Covered Calls Transaction -- STO 5 Apr08 12.5 Calls @ $.20

The Transactions History to date is as follows:
02/20/08 Initial Stock Purchase Transaction -- Bought 800 MYL @ $12.85
02/20/08 Initial Calls Sold Transaction -- Sold 8 MYL Mar08 12.5 Calls @ $.75
03/22/08 Mar08 Options Expired
03/24/08 Covered Calls Continuation Transaction -- Sold 8 Apr08 12.5 Calls @ $.20
Note: Price of MYL was $11.27 when the calls were sold today.

The overall performance results(including commissions)for the MYL transactions through the Apr08 expiration would be as follows:

Stock Purchase Cost: $10,289.95
($12.85*800+$9.95 commission)

Net Profit:
(a) Options Income: $728.10 (800*$.75 + 800*$.20 - 2*$15.95 commissions)
(b) Dividend Income: $0
(c) Capital Appreciation (If stock price unchanged from $11.27): -$1,283.90
= ($11.27-$12.85)*800 - 2*$9.95 commissions
(c) Capital Appreciation (If exercised): -$299.90
= ($12.50-$12.85)*800 - 2*$9.95 commissions

Total Net Profit(If stock price unchanged at $11.27): -$555.80
= ($728.10+$0-$1,283.90)
Total Net Profit(If stock price exercised at $12.50): +$428.20
= ($728.10+$0-$299.90)


Annualized Return If Unchanged (ARIU) -33.4% (-$555.80/$10,289.95)*(365/59 days)
Annualized Return If Exercised (ARIE) +25.7% (+$428.20/$10,289.95)*(365/59 days)


8. Seagate Technology (STX) Continuation Transaction

The following transaction was made today to establish a covered calls position against the 800 shares of STX:
03/24/08 Covered Calls Transaction -- STO 8 Apr08 22.5 Calls @ $.60

The Transactions History to date is as follows:
12/26/07 Initial Stock Purchase Transaction -- Bought 800 STX @ 25.84
12/26/07 Initial Call Options -- Sold 8 STX Jan08 27.5 Calls @ $.55
01/19/08 Jan08 Options Expiration Date -- STX closed below the strike price
01/30/08 Ex-Dividend Date $.100 * 800 shares = $80 dividend income
02/13/08 Covered Calls Continuation Transaction -- STO 8 Mar08 25 Calls @ $0.45
03/22/08 Mar08 Options Expired
03/24/08 Covered Calls Continuation Transaction -- Sold 8 Apr08 22.5 Calls @ $.60
Note: Price of STX was $21.70 when the calls were sold today.

The overall performance results(including commissions)for the STX transactions through the Apr08 expiration would be as follows:
Stock Purchase Cost: $20,681.95
($25.84*800+$9.95 commission)

Net Profit:
(a) Options Income: $1,152.15 (800*$.55 + 800*$.45 +800*$.60 - 3*$15.95 commissions)
(b) Dividend Income: $80.00 ($.100 dividend * 800 shares)
(c) Capital Appreciation (If stock price unchanged from $21.70): -$3,331.90
= ($21.70 - $25.84)*800 - 2*$9.95 commissions
(c) Capital Appreciation (If exercised): -$2,691.90
= ($22.50-$25.84)*800 - 2*$9.95 commissions

Total Net Profit(If stock price unchanged at $23.12): -$2,099.75
= ($1,152.15 + $80.00 - $3,331.90)
Total Net Profit(If stock price exercised at $22.50): -$1,459.75
= ($1,152.15 + $80.00 - $2,691.90)

Annualized Return If Unchanged (ARIU) -32.2% (-$2,099.75/$20,681.95)*(365/115)
Annualized Return If Exercised (ARIE) -22.4% (-$1,459.75/$20,681.95)*(365/115)

1 comment:

  1. Hello!

    I just wanted to say that I have found your blog very informative and well-written. Thanks for your posts. I've learned a lot here. I have been learning about covered calls, and have been employing them as part of my investing for about 4 months now. There's a lot to learn, but I'm doing well so far. I'd say that my approach is a little more conservative than your own, but that could change as I gain more confidence.

    Thanks, and keep up the great posts!

    ReplyDelete