Monday, March 23, 2009

Establish Express Scripts Inc Covered Calls


A new covered call position was established today in the Covered Calls Advisor Portfolio(CCAP) with the purchase of Express Scripts Inc (ESRX) covered calls.

A summary of the transactions is as follows:
Established Express Scripts Inc Covered Calls for Apr09:
03/23/09 Bought 200 ESRX @ $47.05
03/23/09 Sold 2 ESRX Apr09 $50.00 Calls @ $1.40

Absolute Return if Stock Price Unchanged at $47.05: +3.0%
= $1.40/$47.05
Annualized Return if Unchanged(ARIU): +41.7%
Absolute Return if Exercised at $50.00: +9.2%
= [($1.40+($50.00-$47.05)]/$47.05
Annualized Return if Exercised(ARIE): +129.8%
Downside Breakeven Price Point: $45.65
Downside Breakeven Protection: 3.0%

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