Saturday, January 1, 2011

Returns -- Through December 2010

1. December 2010 Year-to-Date Results:

As shown in the table below, the Covered Calls Advisor Portfolio (CCAP) underperformed the Russell 3000 benchmark by 10.47 percentage points (+14.81% -4.34%) in 2010:

















CCAP Absolute Return (Jan 1st through December 31st, 2010) = +4.34%
($287,453.75-$275,491.90)/$275,491.90

Benchmark Russell 3000(IWV) Absolute Return(Jan 1st through December 31st, 2010) = +14.81%
($74.95-$65.28)/$65.28

With a return of +4.34% for 2010, the underperformance in comparison with the Russell 3000 benchmark was definitely disappointing. The two primary reasons for this underperformance were (1) the extraordinarily variable monthly returns (both positive and negative) of the overall market -- monthly returns exceeded +3.0% or were less than -3.0% in ten of the twelve months in 2010; and (2) sub-par stock selections. Neither of these factors relates to the overall desirability of covered calls investing itself, so the Covered Calls Advisor remains 100% commited to remaining fully invested in covered calls at all times in the year ahead. As shown in the table below, the Covered Calls Advisor Portfolio has outperformed in 3 of the 4 years of its existence. This Covered Calls Advisor is looking forward to 2011 and for a return to outperforming the Russell 3000 benchmark -- the motto of this blog remains: "Stick With Covered Calls."

2. Prior Years Results:
The Covered Calls Advisor Portfolio (CCAP) began in September, 2007. The annualized returns achieved each year for 2007 through 2010 compared with the Russell 3000 benchmark were as follows:












As a reminder, the Covered Calls Advisor Portfolio is not identical to the advisor's personal portfolio. However, it does provide a comparable overall portfolio return result since all equities in the CCAP are also held in the personal portfolio. To ensure comparability, all transaction dates and transaction prices herein are identical to those that were established in the Covered Calls Advisor's personal portfolio. The primary difference between the two accounts is the total number of shares held for each equity. This approach is used to preserve the confidentiality of the total value of the Covered Call Advisor's personal portfolio.

If you have any comments or questions, please feel free to submit them -- they are always welcomed. Click the 'comments' link below. If you prefer confidential communications, my email address is listed at the top-right sidebar of this blog site.

Wishing All a Happy, Healthy, and Prosperous New Year in 2010!

Regards and Godspeed,
Jeff

1 comment:

  1. can you tell us how the covered calls portfolio compared to ur portfolio performance -- obviously just a percentage comparison.

    ReplyDelete