The transactions and possible results are as follows:
1. Goldcorp Inc.(GG)
The transactions were as follows:
03/07/2012 Bought 200 Goldcorp Shares @ $46.75
03/08/2012 Sold 2 GG Apr2012 $48.00 Calls @ $1.55
Note: the price of Goldcorp was $47.14 today when the calls were sold.
Two possible overall performance results(including commissions) for the Goldcorp Inc.(GG) transactions would be as follows:
Stock Purchase Cost: $9,358.95
= ($46.75*200+$8.95 commission)
Net Profit:
(a) Options Income: +$299.55
= ($1.55*200 shares) - $10.45 commissions
(b) Dividend Income (GG provides $.045 monthly dividends): +$18.00
= $.045 per share x 200 shares x 2 ex-div dates prior to Apr2012 expiration
(c) Capital Appreciation (If stock price unchanged at $46.75): -$8.95
+($46.75-$46.75)*200 - $8.95 commissions
(c) Capital Appreciation (If stock assigned at $48.00): +$241.05
+($48.00-$46.75)*200 - $8.95 commissions
Total Net Profit(If stock price unchanged at Apr2012 expiration): +$308.60
= (+$299.55 +$18.00 -$8.95)
Total Net Profit(If stock assigned at $48.00 at Apr2012 expiration): +$558.60
= (+$299.55 +$18.00 +$241.05)
1. Absolute Return (If stock price unchanged at Apr2012 expiration): +3.3%
= +$308.60/$9,358.95
Annualized Return (If stock price unchanged at Apr2012 expiration): +27.4%
= (+$308.60/$9,358.95)*(365/44 days)
2. Absolute Return (If stock assigned at $48.00 at Apr2012 expiration): +6.0%
= +$558.60/$9,358.95
Annualized Return (If stock assigned): +49.5%
= (+$558.60/$9,358.95)*(365/44 days)
2. Halliburton Co.(HAL)
The transactions were as follows:03/07/2012 Bought 300 Halliburton Co. Shares @ $34.02
03/08/2012 Sold 3 HAL Mar2012 $35.00 Calls @ $.48
Note: the price of Halliburton was $34.59 today when the calls were sold.
Two possible overall performance results(including commissions) for the Halliburton Co.(HAL)transactions would be as follows:
Stock Purchase Cost: $10,214.95
= ($34.02*300+$8.95 commission)
Net Profit:
(a) Options Income: +$132.80
= ($.48*300 shares) - $11.20 commissions
(b) Dividend Income: $0.00
(c) Capital Appreciation (If stock price unchanged at $34.02): -$8.95
+($34.02-$34.02)*300 - $8.95 commissions
(c) Capital Appreciation (If stock assigned at $35.00): +$285.05
+($35.00-$34.02)*300 - $8.95 commissions
Total Net Profit(If stock price unchanged at Mar2012 expiration): +$123.85
= (+$132.80 +$0.00 -$8.95)
Total Net Profit(If stock assigned at $35.00 at Mar2012 expiration): +$417.85
= (+$132.80 +$0.00 +$285.05)
1. Absolute Return (If stock price unchanged at Mar2012 expiration): +1.2%
= +$123.85/$10,214.95
Annualized Return (If stock price unchanged at Apr2012 expiration): +44.3%
= (+$123.85/$10,214.95)*(365/10 days)
2. Absolute Return (If stock assigned at $35.00 at Mar2012 expiration): +4.1%
= +$417.85/$10,214.95
Annualized Return (If stock assigned): +149.3%
= (+$417.85/$10,214.95)*(365/10 days)
3. Mylan Inc.(MYL)The transactions were as follows:
03/07/2012 Bought 500 Mylan Inc. Shares @ $22.51
03/08/2012 Sold 5 MYL Mar2012 $23.00 Calls @ $.26
Note: the price of Mylan was $22.75 today when the calls were sold.
Two possible overall performance results(including commissions) for the Mylan Inc.(MYL) transactions would be as follows:
Stock Purchase Cost: $11,263.95
= ($22.51*500+$8.95 commission)
Net Profit:
(a) Options Income: +$117.30
= ($.26*500 shares) - $12.70 commissions
(b) Dividend Income: $0.00
(c) Capital Appreciation (If stock price unchanged at $22.51): -$8.95
+($22.51-$22.51)*500 - $8.95 commissions
(c) Capital Appreciation (If stock assigned at $23.00): +$236.05
+($23.00-$22.51)*500 - $8.95 commissions
Total Net Profit(If stock price unchanged at Mar2012 expiration): +$108.35
= (+$117.30 +$0.00 -$8.95)
Total Net Profit(If stock assigned at $23.00 at Mar2012 expiration): +$353.35
= (+$117.30 +$0.00 +$236.05)
1. Absolute Return (If stock price unchanged at Mar2012 expiration): +1.0%
= +$108.35/$11,263.95
Annualized Return (If stock price unchanged at Apr2012 expiration): +35.1%
= (+$108.35/$11,263.95)*(365/10 days)
2. Absolute Return (If stock assigned at $23.00 at Mar2012 expiration): +3.1%
= +$353.35/$11,263.95
Annualized Return (If stock assigned): +114.5%
= (+$353.35/$11,263.95)*(365/10 days)
