- Seven of the nine positions (Blackstone Group, Citigroup Inc., Hertz Global Holdings Inc., iShares MSCI China ETF, Potash Corp. of Saskatchewan Inc., SanDisk Corp, and United Continental Holdings Inc.) were closed out at expiration. This was the optimal result for these seven positions in that the maximum potential return-on-investment (ROI) results from when the positions were established were actually achieved. The annualized ROIs for these seven closed positions are:
Blackstone Group = +2.5% absolute return (equivalent to +18.8% annualized return for the 48 day holding period)
Citigroup Inc. = +2.3% absolute return (equivalent to +24.2% annualized return for the 34 day holding period)
Hertz Global Holdings Inc. = +3.9% absolute return (equivalent to +30.6% annualized return for the 47 day holding period)
iShares MSCI China ETF = +1.8% absolute return (equivalent to +17.1% annualized return for 38 day holding period)
Potash Corp. of Saskatchewan Inc. = +2.8% absolute return (equivalent to +26.6% annualized return for 38 day holding period)
SanDisk Corp = +2.6% absolute return (equivalent to +35.9% annualized return for the 26 day holding period)
United Continental Holdings Inc. = +3.6% absolute return (equivalent to +34.4% annualized return for the 38 day holding period)
The detailed transactions history and results for each of the seven closed positions is detailed below. The cash available from the closing of these positions will be retained in the Covered Calls Advisor Portfolio until new covered calls and/or 100% cash-secured puts positions are established (most likely in the next week or two). These transactions will be posted on this blog the same day they occur.
- Two of the nine positions ended at expiration with long stock positions (Marthon Petroleum Corp and Transocean Inc.). The two Marathon Petroleum Corp 100% cash-secured Puts were assigned at their $70.00 strike price since MPC closed at Sep2013 options expiration last Friday at $64.51, well below the $70.00 strike price. The covered calls position in Transocean Inc. had its options expire since the stock price closed Friday at $45.06, below the Sep2013 options' $48.00 strike price. So, the Covered Calls Advisor Portfolio (CCAP) now owns 200 long shares in Marathon Petroleum and 300 long shares in Transocean Inc. A decision will be made early this week to either sell these shares or to continue with covered calls positions by selling Oct2013 call options against the current long stock holdings. When these decisions are made and the accompanying transactions are completed, a post will be made on this blog on the same day with the transaction details.
Details of the transactions and associated return-on-investment results for the seven closed positions are as follows:
1. Blackstone Group(BX) -- Closed
The transaction was as follows:
8/5/2013 Sold 3 Sep2013 $22.00 Puts @ $.58
Note: The price of BX was $22.74 when this transaction was executed.
The return-on-investment result (including commissions) for this BX transaction was as follows:
100% Cash-Secured Cost Basis: $6,600.00 = $22.00*300
Net Profit:
(a) Options Income: +$162.80
= ($.58*300 shares) - $11.20 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (BX closed above $22.00 at Sep2013 expiration): +$0.00
= ($22.00-$22.00)*300 shares
Total Net Profit: +$162.80
= (+$162.80 +$0.00 +$0.00)
Absolute Return (BX Sep2013 Put options expired worthless): +2.5%
= +$162.80/$6,600.00
Annualized Return: +18.8%
= (+$162.80/$6,600.00)*(365/48 days)
2. Cititgroup Inc.(C) -- Closed
The transaction was as follows:
8/19/2013 Sold 3 Sep2013 $49.00 Puts @ $1.14
Note: The price of Citi was $49.73 when this transaction was executed.
The Covered Calls Advisor does not use margin, so the detailed information on this position and the performance result shown below reflect the fact that this position was established using 100% cash securitization for the three Put options sold.
The overall performance result (including commissions) for this Citigroup transaction was as follows:
100% Cash-Secured Cost Basis: $14,700.00 = $49.00*300
Note: the price of C was $49.73 when these Put options were sold.
Net Profit:
(a) Options Income: +$330.80
= ($1.14*300 shares) - $11.20 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (Citigroup stock price was above $49.00 at Sep2013 expiration): +$0.00 = ($49.00-$49.00)*300 shares
Total Net Profit: +$330.80
= (+$330.80 +$0.00 +$0.00)
Absolute Return (Citi Sep2013 Put options expired worthless): +2.3%
= +$330.80/$14,700.00
Annualized Return: +24.2%
= (+$330.80/$14,700.00)*(365/34 days)
3. Hertz Global Holdings Inc.(HTZ) -- Closed
The transactions were as follows:
08/06/2013 Bought 700 HTZ shares @ $24.50
08/06/2013 Sold 7 HTZ Sep2013 $24.00 Call Options @ $1.50
The return-on-investment performance result (including commissions) for these Hertz covered calls was as follows:
Stock Purchase Cost: $17,158.95
= ($24.50*700+$8.95 commission)
Net Profit:
(a) Options Income: +$1,035.80
= 700*$1.50 - $14.20 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (HTZ assigned at $24.00) = -$358.95
= ($24.00-$24.50)*700 - $8.95 commissions
Total Net Profit: $676.85
= (+$1,035.80 +$0.00 -$358.95)
Absolute Return: +3.9%
= +$676.85/$17,158.95
Annualized Return: +30.6%
= (+$676.85/$17,158.95)*(365/47 days)
4. iShares MSCI China ETF (FXI) -- Closed
The transaction is as follows:
8/15/2013 Sold 5 Sep2013 $35.00 Puts @ $.65
Note: The price of FXI was $35.95 when this transaction was executed.
The overall performance result (including commissions) for this FXI transaction was as follows:
100% Cash-Secured Cost Basis: $17,500.00 = $35.00*500
Net Profit:
(a) Options Income: +$312.30
= ($.65*500 shares) - $12.70 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (FXI above $35.00 at Sep2013 expiration): +$0.00
= ($35.00-$35.00)*500 shares
Total Net Profit: +$312.30 = (+$312.30 +$0.00 +$0.00)
Absolute Return: +1.8%
= +$312.30/$17,500.00
Annualized Return: +17.1%
= (+$312.30/$17,500.00)*(365/38 days)
5. Potash Corp of Saskatchewan Inc. (POT) -- Closed
The transactions were as follows:
08/15/2013 Bought 300 POT shares @ $30.10
08/06/2013 Sold 3 POT Sep2013 $29.00 Call Options @ $2.00
The overall performance result (including commissions) for these Potash Corp (POT) covered calls was as follows:
Stock Purchase Cost: $9,038.95
= ($30.10*300+$8.95 commission)
= ($30.10*300+$8.95 commission)
(a) Options Income: +$588.80
= 300*$2.00 - $11.20 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (POT assigned at $29.00) = -$338.95
= ($29.00-$30.10)*300 - $8.95 commissions
= 300*$2.00 - $11.20 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (POT assigned at $29.00) = -$338.95
= ($29.00-$30.10)*300 - $8.95 commissions
Total Net Profit: +$249.85
= +$588.80+$0.00-$338.95
Absolute Return: +2.8%= +$588.80+$0.00-$338.95
= +$249.85/$9,038.95
Annualized Return: +26.6%
= (+$249.85/$9,038.95)*(365/38 days)
Annualized Return: +26.6%
= (+$249.85/$9,038.95)*(365/38 days)
6. SanDisk Corporation (SNDK) -- Closed
The transaction is as follows:
8/27/2013 Sold 2 Sep2013 $55.00 SNDK Puts @ $1.46
Note: The price of SNDK was $55.44 when this transaction was executed.
The Covered Calls Advisor does not use margin, so the detailed information on this position and some potential results shown below reflect the fact that this position was established using 100% cash securitization for the two Put options sold.
The performance result (including commissions) for this SanDisk transaction was as follows:
100% Cash-Secured Cost Basis: $11,000.00 = $55.00*200
Net Profit:
(a) Options Income: +$281.55
= ($1.46*200 shares) - $10.45 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (SNDK was above $55.00 at Sep2013 expiration): +$0.00
= ($55.00-$55.00)*200 shares
Total Net Profit: +$281.55
= (+$281.55 +$0.00 +$0.00)
Absolute Return: +2.6%
= +$281.55/$11,000.00
Annualized Return: +35.9%
= (+$281.55/$11,000.00)*(365/26 days)
7. United Continental Holdings Inc. (UAL)
The transaction is as follows:
Absolute Return (UAL was above $28.00 at Sep2013 options expiration and Put options thus expired worthless): +3.6%
= +$300.80/$8,400.00
Annualized Return: +34.4%
8/27/2013 Sold 2 Sep2013 $55.00 SNDK Puts @ $1.46
Note: The price of SNDK was $55.44 when this transaction was executed.
The Covered Calls Advisor does not use margin, so the detailed information on this position and some potential results shown below reflect the fact that this position was established using 100% cash securitization for the two Put options sold.
The performance result (including commissions) for this SanDisk transaction was as follows:
100% Cash-Secured Cost Basis: $11,000.00 = $55.00*200
Net Profit:
(a) Options Income: +$281.55
= ($1.46*200 shares) - $10.45 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (SNDK was above $55.00 at Sep2013 expiration): +$0.00
= ($55.00-$55.00)*200 shares
Total Net Profit: +$281.55
= (+$281.55 +$0.00 +$0.00)
Absolute Return: +2.6%
= +$281.55/$11,000.00
Annualized Return: +35.9%
= (+$281.55/$11,000.00)*(365/26 days)
7. United Continental Holdings Inc. (UAL)
The transaction is as follows:
8/15/2013 Sold 3 Sep2013 $28.00 Puts @ $1.04
Note: The price of UAL was $29.57 when this transaction was executed.
Note: The price of UAL was $29.57 when this transaction was executed.
The overall performance result (including commissions) for this UAL transaction was as follows:
100% Cash-Secured Cost Basis: $8,400.00 = $28.00*300
Net Profit:
(a) Options Income: +$300.80
= ($1.04*300 shares) - $11.20 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (UAL was above $28.00 at Sep2013 expiration): +$0.00
= ($28.00-$28.00)*300 shares
100% Cash-Secured Cost Basis: $8,400.00 = $28.00*300
Net Profit:
(a) Options Income: +$300.80
= ($1.04*300 shares) - $11.20 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (UAL was above $28.00 at Sep2013 expiration): +$0.00
= ($28.00-$28.00)*300 shares
Total Net Profit: +$300.80
= (+$300.80 +$0.00 +$0.00)
= (+$300.80 +$0.00 +$0.00)
= +$300.80/$8,400.00
Annualized Return: +34.4%
= (+$300.80/$8,400.00)*(365/38 days)
