The Covered Calls Advisor Portfolio (CCAP) contained three positions with July 2016 expirations. The three positions (Alphabet Inc., Home Depot Inc., and S&P 500 ETF) were 100% cash-secured Put options and all three were closed out upon expiration since the stock price was above the strike price at options expiration.
The overall average annualized return-on-investment for these three positions was +21.5%. The return-on-investment result for each position was:
- Alphabet Inc. = +1.5% absolute return (+28.3% annualized return)
- Home Depot Inc. = +0.8% absolute return (+16.3% annualized return)
- S&P 500 ETF = +0.9% absolute return (+19.8% annualized return)
The details for each position is shown below. The cash now 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. Any new positions will be posted on this site on the same day they occur.
1. Alphabet Inc. (GOOGL) -- 100% Cash-Secured Put Options Closed at Expiration
The transaction was as follows:
06/27/2016 Sold 1 GOOGL Jul2016 $665.00 100% cash-secured Put option @ $9.90
Note: the price of GOOGL was $679.87 today when this transaction was executed.
07/15/2016 GOOGL Jul2016 options expired
Note: price of GOOGL was $735.63 upon options expiration
The Covered Calls Advisor does not use margin, so the detailed
information on this position and a potential result shown below
reflect the fact that this position was established using 100% cash
securitization for the Put option sold.
The overall performance result (including commissions) was as follows:
100% Cash-Secured Cost Basis: $66,500.00
= $665.00*100
Net Profit:
(a) Options Income: +$981.30
= ($9.90*100 shares) - $8.70 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (GOOGL is above $665.00 strike price at Jul2016 expiration): +$0.00
= ($665.00-$665.00)*100 shares
Total Net Profit: +$981.30
= (+$981.30 options income +$0.00 dividend income +$0.00 capital appreciation)
Absolute Return: +1.5%
= +$981.30/$66,500.00
Annualized Return: +28.3%
= (+$981.30/$66,500.00)*(365/19 days)
2. Home Depot Inc. (HD) -- 100% Cash-Secured Puts Position Closed at Expiration
The transaction was as follows:
06/27/2016 Sold 3 HD Jul2016 $120.00 100% cash-secured Put options @ $1.05
Note: the price of HD was $125.09 today when this transaction was executed.
07/15/2016 HD Jul2016 options expired
Note: price of HD was $134.78 upon options expiration
The overall performance result (including commissions) was as follows:
100% Cash-Secured Cost Basis: $36,000.00
= $120.00*300
Net Profit:
(a) Options Income: +$304.80
= ($1.05*300 shares) - $10.20 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (HD was above $120.00 strike price at Jul2016 expiration): +$0.00
= ($120.00-$120.00)*300 shares
Total Net Profit: +$304.80
= (+$304.80 options income +$0.00 dividend income +$0.00 capital appreciation)
Absolute Return: +0.8%
= +$304.80/$36,000.00
Annualized Return: +16.3%
= (+$304.80/$36,000.00)*(365/19 days)
3. S&P 500 ETF (SPY) -- 100% Cash-Secured Puts Position Closed at Expiration
The transaction was as follows:
06/27/2016 Sold 3 SPY Jul2016 $192.50 100% cash-secured Put options @ $1.86
Note: the price of SPY was $199.75 today when this transaction was executed.
07/15/2016 SPY Jul2016 options expired
Note: price of SPY was $215.83 upon options expiration
The overall performance result (including commissions) was as follows:
100% Cash-Secured Cost Basis: $57,750.00
= $192.50*300
Net Profit:
(a) Options Income: +$547.80
= ($1.86*300 shares) - $10.20 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (SPY was above $192.50 strike price at Jul2016 expiration): +$0.00
= ($192.50-$192.50)*300 shares
Total Net Profit: +$547.80
= (+$547.80 options income +$0.00 dividend income +$0.00 capital appreciation)
Absolute Return: +0.9%
= +$547.80/$57,750.00
Annualized Return: +19.8%
= (+$547.80/$57,750.00)*(365/19 days)
