Today, the Covered Calls Advisor Portfolio(CCAP) established Mar2010 covered calls positions for current stock holdings in Amgen Inc. and Fluor Corporation, both for which prior Feb2010 covered calls had expired out-of-the-money. Details of the covered calls positions established today for AMGN and FLR are as follows:
1. Amgen Inc.(AMGN) -- Continuation
Today it was decided to retain the 200 shares of Amgen Inc.(AMGN) and to establish a Mar2010 covered calls position as follows:
03/03/2010 Sell-to-Open (STO) 2 AMGN Mar2010 $57.50s @ $.69
The transactions history to date for AMGN is as follows:
10/22/09 Bought 200 AMGN @ $56.40
10/22/09 Sold 2 AMGN Nov09 $57.50 Calls @ $1.20
11/21/09 Nov09 Options Expired
11/23/09 Sell-to-Open (STO) 2 AMGN Dec09 $57.50s @ $.93
Note: Price of AMGN was $56.15 when the Dec09 options were sold.
12/19/09 Dec09 Options Expired
12/21/09 Sell-to-Open (STO) 2 AMGN Jan2010 $57.50s @ $1.14
Note: Price of AMGN was $56.80 when the Jan2010 options were sold.
01/16/2010 Jan2010 Options Expired
01/19/2010 Sell-to-Open (STO) 2 AMGN Feb2010 $57.50s @ $1.45
Note: Price of AMGN was $57.02 when the Feb2010 options were sold.
02/20/2010 Feb2010 Options Expired
03/03/2010 Sell-to-Open (STO) 2 AMGN Mar2010 $57.50s @ $.69
Note: Price of AMGN was $57.16 when the Mar2010 options were sold.
Two possible overall performance results(including commissions) for the AMGN transactions would be as follows:
Stock Purchase Cost: $11,288.95
= ($56.40*200+$8.95 commission)
Net Profit:
(a) Options Income: +$1,029.75
= (200*($1.20+$.93+$1.14+$1.45+$.69) - 5*$10.45 commissions)
(b) Dividend Income: +$0.00
(c) Capital Appreciation(If stock price unchanged at $57.16): +$143.05
= ($57.16-$56.40)*200 - $8.95 commissions
(c) Capital Appreciation (If stock exercised at $57.50): +$211.05
= ($57.50-$56.40)*200 - $8.95 commissions
Total Net Profit(If stock price unchanged at $57.16): +$1,172.80
= (+$1,029.75 +$0.00 +$143.05)
Total Net Profit(If stock exercised at $57.50): +$1,240.80
= (+$1,029.75 +$0.00 +$211.05)
Absolute Return if Stock Price Unchanged at $57.16: +10.4%
= +$1,172.80/$11,288.95
Annualized Return If Unchanged (ARIU): +25.4%
= (+$1,172.80/$11,288.95)*(365/149 days)
Absolute Return if Stock Exercised at $57.50: +11.0%
= (+$1,240.80/$11,288.95)
Annualized Return If Exercised (ARIE): +26.9%
= (+$1,240.80/$11,288.95)*(365/149 days)
2. Fluor Corporation (FLR) -- Continuation
Today it was decided to retain the 300 shares of Fluor Corporation (FLR) and to establish a Mar2010 covered calls position as follows:
03/03/2010 Sell-to-Open (STO) 3 FLR Mar2010 $45.00s @ $.35
The transactions history to date for FLR is as follows:
09/22/09 Bought 300 FLR @ $54.93
09/22/09 Sold 3 FLR Oct09 $55.00 Calls @ $1.95
10/17/09 Oct09 Options Expired
The closing price of FLR was $50.24 on expiration Friday.
10/19/09 Sell-to-Open (STO) 3 FLR Nov09 $55.00s @ $.95
The price of FLR was $51.57 today when this transaction was executed.
11/11/09 Buy-to-Close (BTC) 3 FLR Nov09 $55.00s @ $.05
11/11/09 Sell-to-Open (STO) 3 FLR Nov09 $45.00s @ $1.15
Note: Net Credit-Spread upon Roll-Down was $1.10 ($1.15 - $.05)
11/21/09 Nov09 Options Expired
The closing price of FLR was $44.19 on expiration Friday.
12/02/2009 Ex-Dividend $37.50 (.125*300 shares)
12/15/09 Sell-to-Open (STO) 3 FLR Jan2010 $45.00s @ $1.10
Note: The price of FLR was $43.10 today when this transaction was made.
01/16/2010 Jan2010 Options Expired
03/03/2010 Ex-Dividend $37.50 (.125*300 shares)
03/03/2010 Sell-to-Open (STO) 3 FLR Mar2010 $45.00s @ $.35
Note: Price of FLR was $43.26 when the Mar2010 options were sold.
Two possible overall performance results(including commissions) for the FLR transactions would be as follows:
Stock Purchase Cost: $16,487.95
= ($54.93*300+$8.95 commission)
Net Profit:
(a) Options Income: +$1,579.00
= (300*($1.95+$.95-$.05+$1.15+$1.10+$.35) - 5*$11.20 commissions)
(b) Dividend Income: +$75.00 =($.125*2)*300 shares
(c) Capital Appreciation (If stock price unchanged at $43.26): -$3,509.95
= ($43.26-$54.93)*300 - $8.95 commissions
(c) Capital Appreciation (If exercised at $45.00): -$2,987.95
= ($45.00-$54.93)*300 - $8.95 commissions
Total Net Profit(If stock price unchanged at $43.26): -$1,855.95
= (+$1,579.00 +$75.00 -$3,509.95)
Total Net Profit(If stock price exercised at $45.00): -$1,333.95
= (+$1,579.00 +$75.00 -$2,987.95)
Absolute Return if Stock Price Unchanged at $43.26: -11.3%
= -$1,855.95/$16,487.95
Annualized Return If Stock Price Unchanged (ARIU): -23.0%
= (-$1,855.95/$16,487.95)*(365/179 days)
Absolute Return if Exercised at $45.00: -8.1%
= -$1,333.95/$16,487.95
Annualized Return If Exercised (ARIE) -16.5%
= (-$1,333.95/$16,487.95)*(365/179 days)
