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Thursday, September 25, 2008

Establish Dell Inc Covered Calls

A new covered calls position was established today in the Covered Calls Advisor Portfolio(CCAP) as follows:

Established Dell Inc (DELL) Covered Calls for Oct08. Dell currently provides an extremely attractive price for this value-oriented investor. It was purchased today at a P/E of 12, a P/Sales of 0.5, cash at 28% of market cap, and total debt of 6% of market cap. Given Dell's relatively new presence in Best Buy stores, near-term growth potential is good for both revenue and earnings.

09/25/08 Bought 1200 DELL @ $16.73
09/25/08 Sold 12 DELL Oct08 $17.00 Calls @ $.75

Annualized Return If Stock Price Unchanged (ARIU): +71.0%
Annualized Return If Exercised (ARIE): +96.8%
Downside Breakeven Protection: 4.5%

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