Monday, June 2, 2008

Continuation Transaction -- Frontier Oil

The following transaction was made today to establish a covered calls position against the 500 shares of FTO:
06/02/08 Covered Calls Transaction -- STO 5 Jun08 35 Calls @ $.60

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.
04/19/08 Apr08 Options Expired
06/02/08 Covered Calls Continuation Transaction -- Sold 5 Jun08 35 Calls @ $.60

The overall performance results(including commissions)for the FTO transactions through the Jun08 expiration would be as follows:
Stock Purchase Cost: $18,809.95
($37.60*500+$9.95 commission)

Net Profit:
(a) Options Income: +$1,658.90 (500*($1.35+$1.45+$.60) - 3*$13.70 commissions)
(b) Dividend Income: $0
(c) Capital Appreciation (If exercised): -$1,319.90
= ($35.00-$37.60)*500 - 2*$9.95 commissions

Total Net Profit(If stock price exercised at $35.00): +$339.00
= (+$1,658.90 +$0 -$1,319.90)

Annualized Return If Exercised (ARIE) +5.4%
(+$339.00/$18,809.95)*(365/122 days)

No comments:

Post a Comment