During the past month (since August 1st), the benchmark S&P 500 (SPY) has experienced a substantial decline of -4.5%. The Covered Calls Advisor Portfolio had four positions with September 2nd, 2022 options expirations, all of which were established with moderately in-the-money strike prices.
Only one of these positions (Cleveland-Cliffs Inc.) closed in-the-money at yesterday's expiration . The other three companies (Applied Materials Inc., Discover Financial Services, and MGM Resorts International) closed out-of-the-money (i.e. with their stock prices below their strike price). So, the Call options for these 3 positions expired and their shares now remain in the Covered Calls Advisor Portfolio. A decision will be made next week to either sell these shares or to continue these Covered Calls positions by selling future Call options against the shares currently held.
The results for the closed position in Cleveland-Cliffs was +1.5% absolute return (equivalent to +37.3% annualized return-on-investment) for the 15 days of this investment. The original post detailing this Covered Calls position is here. The cash now available from the assignment (i.e. closing) of this
position will be retained until new Covered Calls (and/or
100%
Cash-Secured Puts) positions are established. Given the Covered Calls
Advisor's currently Bearish Overall Market outlook, new positions will
be hedged by continuing to establish Covered Calls at in-the-money
strike prices with good downside protection.
Please email me at the address shown below if you would like my feedback on any questions or comments you have related to the Covered Calls investing strategy.
Best Wishes,
Jeff Partlow
The Covered Calls Advisor
partlow@cox.net
