The four positions that ended at Nov2016 options expiration with the
price of the stock below the strike price were Agnico Eagle Mines (500
shares), Alibaba Group (400 shares), Facebook (300 shares), and Hanes
Brands (1,000 shares). Today, two positions (Alibaba and Agnico Eagle Mines) were continued by establishing covered calls. December 2016 call options were sold against the long shares in these companies. Shares held in the other two stocks (Facebook and Hanes Brands) were sold today. The transactions associated with each of these positions are detailed below.
I. Covered Calls Continuation Transactions -- Agnico Eagle Mines and Alibaba
Agnico Eagle Mines
The transactions to-date are:
10/26/2016 Bought 500 shares Agnico Eagle Mines Ltd.(AEM) @ $48.07
10/26/2016 Sold 5 AEM Nov2016 $46.00 Call options @ $3.12
11/18/2016 5 AEM Call options expired with AEM stock below strike price
11/21/2016 Sold 5 AEM Dec2016 $45.00 Call options @ $1.20
Note: price of AEM stock was $43.27 when these Dec2016 options were sold
Alibaba Group Holding
The transactions to-date are:
10/26/2016 Sold 4 Alibaba (BABA) Nov2016 $95.00 100% Cash-Secured Put options @ $1.25
11/18/2016 4 BABA Puts assigned and 400 shares of Alibaba purchased at $95.00
11/21/2016 Sold 4 BABA Dec2016 $95.00 Call options @ $2.26
Note: the price of BABA was $94.27 when these Call options were sold
The return-on-investment results for these two positions will be detailed when these positions are closed.
II. Two Positions Closed -- Facebook Inc. and Hanes Brands Inc.
The Covered Calls Advisor closed these two holdings today by selling the stock owned in each. Details of the transactions and the associated results are as follows:
Facebook Inc.
The transactions history for this position was as follows:
10/26/2016 Sold 3 Facebook (FB) Nov2016 $125.00 100% Cash-Secured Put options @ $2.22
11/18/2016 3 FB Puts assigned and 300 shares of Facebook purchased at $125.00
11/21/2016 Sold 300 Facebook shares @ $121.67
The overall performance result (including commissions) was as follows:
100% Cash-Secured Cost Basis: $37,500.00
= $125.00*300
Net Profit:
(a) Options Income: +$655.80
= ($2.22*300 shares) - $10.20 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation: -$999.00
= ($121.67-$125.00)*300 shares
Total Net Profit: -$343.20
= (+$655.80 options income +$0.00 dividend income -$999.00 capital appreciation)
Absolute Return: -0.9%
= -$343.20/$37,500.00
Annualized Return: -12.8%
= (-$343.20/$37,500.00)*(365/26 days)
Hanes Brands Inc.
The transactions history for this position was as follows:
10/09/2016 Sold 10 Hanes Brands Inc.(HBI) Nov2016 $25.00 100% Cash-Secured Put options @ $.90
11/18/2016 10 Hanes Puts assigned and 1,000 shares of Hanes stock purchased at $25.00
11/21/2016 Sold 1,000 Hanes shares @ $24.49
The overall performance result (including commissions) was as follows:
100% Cash-Secured Cost Basis: $25,000.00
= $25.00*1,000
Net Profit:
(a) Options Income: +$884.55
= ($.90*1,000 shares) - $15.45 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation: -$510.00
= ($24.49-$25.00)*1,000 shares
Total Net Profit: +$374.55
= (+$884.55 options income +$0.00 dividend income -$510.00 capital appreciation)
Absolute Return: +1.5%
= +$374.55/$25,000.00
Annualized Return: +12.7%
= (+$374.55/$25,000.00)*(365/43 days)
