Monday, June 3, 2013

Establish Covered Calls -- Fluor Corporation

Today, a new covered calls position was established in Fluor Corporation  (Ticker Symbol FLR) with a Jun2013  options expiration date.  The details are as follows:

1. Fluor Corporation (FLR) -- New Covered Calls Position
The transactions were as follows:
06/03/2013 Bought 200 FLR shares @ $62.66
06/03/2013 Sold 2 FLR Jun2013 $62.50 Call Options @ $1.80.
Note: the price of FLR was $62.69 when the options were sold.


A possible overall performance result (including commissions) for these Fluor Corporation (FLR) covered calls is as follows:
Stock Purchase Cost: $12,540.95
= ($62.66*200+$8.95 commission)

Net Profit:
(a) Options Income: +$349.55
= 200*$1.80 - $10.45 ommissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (If FLR assigned at $62.50) = -$40.95
= ($62.50-$62.66)*200 - $8.95 commissions

Total Net Profit (If FLR assigned at $62.50): +$308.60
= (+$349.55 +$0.00 -$40.95)

Absolute Return if Assigned (at $62.50): +2.5%
= +$308.60/$12,540.95
Annualized Return If Assigned (ARIA): +44.9%
= (+$308.60/$12,540.95)*(365/20 days)