Last Friday was expiration Friday for January 2011. A decision was made today to sell the 300 shares owned in Intel Corp.(INTC). The Covered Calls Advisor views both Intel and Microsoft prospects similarly in that their sales are both correlated strongly with PC sales. This advisor has determined that Microsoft's software-focused product offerings have better ongoing growth prospects than the hardware-focused and commoditized nature of Intel. So the Intel position was sold and the preferred Microsoft covered calls position will be continued.
1. Intel Corp.(INTC) -- Closed
The transactions history was as follows:
12/27/2010 Bought 300 INTC @ $20.71
12/27/2010 Sell-to-Open(STO) 3 INTC Jan2011 $21.00 CallS @ $.40
Note: The price of INTC was $20.78 today when these options were sold.
01/22/2011 Jan2011 INTC options expired
Note: The price of INTC was $20.82 at closing on expiration Friday.
01/24/2011 Sold 300 INTC @ $21.05
The overall performance result(including commissions) for the Intel Corp.(INTC) transactions was as follows:
Stock Purchase Cost: $6,242.95
= ($20.78*300+$8.95 commission)
Net Profit:
(a) Options Income: +$111.05
= (300*$.40 - $11.20 commissions)
(b) Dividend Income: $0.00
(c) Capital Appreciation (Stock sold at $21.05): +$93.05
= ($21.05-$20.71)*300 - $8.95 commissions
Total Net Profit(With stock sold at $21.05): +$204.10
= (+$111.05 +$0.00 +$93.05)
Absolute Return: +3.3%
= +$204.10/$6,242.95
Annualized Return: +42.6%
= (+$204.10/$6,242.95)*(365/28 days)
