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Saturday, January 17, 2009

January 2009 Expiration Transactions

The Covered Calls Advisor Portfolio (CCAP) contained a total of 12 positions with January 2009 expirations, with the following results:
- 2 position (RTN & SY) closed in-the-money.
The calls were exercised and the stock was called away. The annualized percent return-on-investment(ROI) results were:

Raytheon Co. +31.7%
Sybase Inc. +133.4%

- 10 positions in the CCAP (MO,ESRX,FLR,GU,HUM,FXI,EWY,MSFT,POT, and USO) ended out-of-the-money. Decisions will be made to either sell the equities, or to keep them and sell calls to establish Feb09 covered call positions. The related transactions will be made during the next few days and the actual transactions will be posted on this blog site on the same day they occur.


Details for the Raytheon and Sybase exercised positions are as follows:

1. Raytheon Company -- Closed
The Transactions History was as follows:
12/22/08 Initial Stock Purchase Transaction -- Bought 300 RTN @ $49.20
12/22/08 Initial Calls Sold Transaction -- Sold 3 RTN Jan09 $47.50 Calls @ $2.60
12/30/08 $84.00 Ex-Dividend ($.28 * 300 shares)
01/17/09 Jan09 Options Exercised -- 300 shares RTN called away
Note: Closing price of RTN was $52.67 on expiration Friday

The overall performance results(including commissions) for the RTN transactions through the Jan09 expiration were as follows:
Stock Purchase Cost: $14,768.95
($49.20*300+$8.95 commission)

Net Profit:
(a) Options Income: +$768.80 (300*$2.60 - $11.20 commissions)
(b) Dividend Income: +$84.00
(c) Capital Appreciation: -$518.95
= ($47.50-$49.20)*300 - $8.95 commissions

Total Net Profit: +$333.85
= (+$768.80 +$84.00 -$518.95)

RTN Annualized Return on Investment +31.7%
(+$333.85/$14,768.95)*(365/26 days)


2. Sybase Inc. -- Closed
The Transactions History was as follows:
12/22/08 Initial Stock Purchase Transaction -- Bought 300 SY @ $23.36
12/22/08 Initial Calls Sold Transaction -- Sold 3 SY Jan09 $25.00 Calls @ $.65
01/17/09 Jan09 Options Exercised -- 300 shares SY called away
Note: Closing price of SY was $25.04 on expiration Friday

The overall performance results(including commissions) for the SY transactions through the Jan09 expiration were as follows:
Stock Purchase Cost: $7,016.95
($23.36*300+$8.95 commission)

Net Profit:
(a) Options Income: +$183.80 (300*$.65 - $11.20 commissions)
(b) Dividend Income: +$0.00
(c) Capital Appreciation: +$483.05
= ($25.00-$23.36)*300 - $8.95 commissions

Total Net Profit: +$666.85
= (+$183.80 +$0.00 +$483.05)

SY Annualized Return on Investment +133.4%
(+$666.85/$7,016.95)*(365/26 days)

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