tag:blogger.com,1999:blog-49635406535531397242024-03-28T15:58:35.592-04:00 Covered Calls AdvisorCovered Calls Investing in Bull and Bear MarketsJEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comBlogger2291125tag:blogger.com,1999:blog-4963540653553139724.post-15995738156349293732024-03-28T15:56:00.001-04:002024-03-28T15:56:22.644-04:00Covered Calls Established in Netease Inc. ADRThis afternoon my buy/write Covered Calls position was transacted in Netease Inc. ADR (ticker NTES) at a net debit limit order price of $97.72 per share. Two hundred shares were purchased at $103.50 and two April 19th, 2024 Call options were sold at the $100.00 strike price at $5.78 per share. This provides a time value profit potential of $2.28 per share [$5.78 Call options premium - ($103.50 stock purchase price - $100.00 strike price)]. The Delta was 66.6 which approximates a 66.6% probability of closing in-the-money on the options expiration date. Although I am primarily a fundamental, valuation-oriented investor, Netease's short-term price action became oversold today [i.e. RSI(2) = 19.9] since, on a technical analysis basis, it was in what is commonly considered oversold territory (below 30.0). As preferred, the next earnings report on May 30th is after the April 19th options expiration date. <div><br /></div><div>Netease began as a Chinese internet portal in the late 1990s but has now become the second largest mobile game company in the world. It owns one of the most well-known massively multiplayer franchises in China -- Fantasy Westward Journey. The firm's other investments in music streaming, online education, and e-commerce also have long-term potential. Although primarily in China, they also offer services in Japan, U.S., Europe, and SE Asia.<br /><br /></div><div>The ten analysts that cover Netease have an average target price of $135.27 (+30.7% above today's purchase price) and the discounted cash flow margin-of-safety is 22%. Every analyst has either a Strong Buy or Buy rating on the company -- none have a Hold, Sell, or Strong Sell rating. Netease also appeared today in my Stock Rover Overall stock screener (see chart below) where it met all 15 screener filters. I was also pleased to see that LSEG (Refinitiv) gives Netease its top rating of 10 for both its Average Score and its Optimized Score, which puts it in the top 5% of companies monitored by Refinitiv.</div><div><div><br /><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgm-B1Q4y6sNsNeJEgPaMjvhRmks1ZeFVgHOpmSdqwJhvpOuUWPXF6fmdJ2Ysj2e2EQKbqKuboZcX5X_9BArl3QZv1CiTAeXFow8xco6n26RxL_Q81F5aIcyIxUzOySFhx6NJTzfF2_DgYfT14muoOgzAAtzxnz4ViPRrSO-oDBxhopDRSU5N1I0XILrBM/s614/NTES%20SR%20Overall.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="614" data-original-width="535" height="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgm-B1Q4y6sNsNeJEgPaMjvhRmks1ZeFVgHOpmSdqwJhvpOuUWPXF6fmdJ2Ysj2e2EQKbqKuboZcX5X_9BArl3QZv1CiTAeXFow8xco6n26RxL_Q81F5aIcyIxUzOySFhx6NJTzfF2_DgYfT14muoOgzAAtzxnz4ViPRrSO-oDBxhopDRSU5N1I0XILrBM/s600/NTES%20SR%20Overall.png" /></a></div></div><div><div div="" nbsp=""><p><b>As detailed below, a potential return-on-investment result is </b><b>+2.3% absolute return-on-investment (equivalent to +38.6% annualized
return-on-investment for the next 22 days) if the Netease Inc. share price is </b><b><b>in-the-money (i.e. above the $100.00 strike price) and therefore assigned on its April 19th, 2024 options expiration date.</b></b></p><p> <br /><b>Netease Inc. ADR (NTES) -- New Covered Calls Position</b> </p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh4bLsOm9cWjvQh1kdS7ItWtgh7qPqrhdxVuQsCosR6gXZzMkGtM4jRfZIJL7jzBFzTr2xAj2Kl0_sSKAxrkUE8HI_3stb-c2v86yfSBvIcEfcYov8WOiud8XW73ZzHSGDtuYJrPe5pN7A_qVpgx0juzsnMUkk4NkBgQk2Hr29Da4vVP_wVuvTFWzbCluk/s331/NTES%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="152" data-original-width="331" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh4bLsOm9cWjvQh1kdS7ItWtgh7qPqrhdxVuQsCosR6gXZzMkGtM4jRfZIJL7jzBFzTr2xAj2Kl0_sSKAxrkUE8HI_3stb-c2v86yfSBvIcEfcYov8WOiud8XW73ZzHSGDtuYJrPe5pN7A_qVpgx0juzsnMUkk4NkBgQk2Hr29Da4vVP_wVuvTFWzbCluk/s200/NTES%20logo.png" width="200" /></a></div>The Buy/Write transaction was as follows:<br />3/28/2024 Bought 200 shares of Netease Inc. @ $103.50 per share. <br />3/28/2024 Sold 2 NTES April 19th, 2024 $100.00 Call options @ $5.78 per share. The Implied Volatility of these Call options was 35.6 today when this transaction was executed and its Beta (1-year) is 1.02. <p></p><p>
A possible overall performance result (including commissions) for this Netease Inc. ADR Covered Calls position is as follows: <br />Covered Calls Net Investment: $19,545.34<br />
= ($103.50 - $5.78) * 200 shares + $1.34 commission<br />
<br />
Net Profit:<br />
(a) Options Income: +$1,154.66<br />
= ($5.78 * 200 shares) - $1.34 commission <br />(b) Dividend Income: +$0.00<br />
(c) Capital Appreciation (If 200 Netease Inc. shares assigned at $100.00 strike price at the options expiration date): -$700.00 <br />
+($100.00 - $103.50) * 200 shares<br /><br />
Total Net Profit Potential (If 200 Netease Inc. shares assigned at $100.00 strike price at the options expiration date): +$454.66<br />
= (+$1,154.66 options income +$0.00 dividend income -$700.00 capital appreciation)</p><p>Potential Absolute Return-on-Investment: +2.3%<br />
= +$454.66/$19,545.34<br />Potential Annualized Return-on-Investment: +38.6%<br />
= (+$454.66/$19,545.34) * (365/22 days)</p></div></div></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-85874803633744675652024-03-27T13:48:00.003-04:002024-03-27T18:52:27.083-04:00Established Covered Calls Position in Globe Life Inc.Early in this morning's trading session, my buy/write limit order was executed in Globe Life Inc. (ticker GL) to buy 200 shares and simultaneously sell 2 Call options at the April 19th, 2024 monthly options expiration date and at the $110.00 strike price. The net debit limit price for my order was $107.80 which was executed when 200 shares were purchased at $116.50 and 2 April 19th, 2024 Call options were sold for $8.70 per share. Therefore, a maximum potential time value profit of $2.20 per share = [$8.70 Call options premium - ($116.50 stock price - $110.00 strike price)] is possible for this position. <div><br /></div><div>Given that the Beta (1-year) for Globe Life is only 0.53, I am pleased that the Implied Volatility of the Calls was higher than expected at 31.8 when this position was transacted which, as preferred, is substantially higher than the 13.3 of the S&P 500 Volatility Index (i.e. VIX). The Delta for these Call options was approximately 72.0 when this position was established which approximates the probability of 72.0% that the position will be in-the-money at market close on the options expiration date. Also, importantly to the Covered Calls Advisor, there is no quarterly earnings report prior to the options expiration date since the next earnings report on May 8th, 2024 is after the April 19th options expiration date. Globe Life is now the only holding in my Covered Calls Advisor Portfolio in the Financial Sector, now having replaced the U.S. Bancorp position that had an early assignment this morning. <br /><br /><div>This position uses the Covered Calls Advisor's Dividend Capture Strategy (see <a href="https://coveredcallsadvisor.blogspot.com/2023/01/the-covered-calls-advisors-dividend.html">here</a>) since Globe Life Inc. has an upcoming quarterly ex-dividend of $.24 per share (0.8% annual dividend yield) eight days from today on April 4th which is prior to the April 19th options expiration date. I am encouraged by the 6.7% increase in their annual dividend and this dividend is included in the detailed return-on-investment calculations below. Although an early assignment on the day prior to the ex-dividend date is unlikely, either an early assignment on April 3rd (the last trading day prior to the April 4th ex-dividend date) or on the April 19th options expiration date would provide a nice annualized-return-on-investment result for this position. </div><div><br /></div><div>Globe Life Inc. is an insurance company with core operations in life insurance, supplemental health insurance, and annuities and their primary customers are U.S. middle-income families. According to LSEG (Refinitiv), there are 9 analysts covering Globe Life and their current average Target Price is $136.42 which is +17.1% above today's stock purchase price, and Globe Life receives Refinitiv's highest Average Score of 10 which puts them in the top 5% of all North American stocks they cover. Another reason for establishing this position was that it is highly ranked in my "Future 5-Year PEG Ratio" stock screener since it met all 15 filters (see chart below where I circled the 5-Year Forward PEG Ratio filter of 0.78 -- a very attractive valuation metric). This is calculated as the trailing twelve months P/E Ratio of 11.6 divided by the projected next 5 years compounded annual EPS growth rate (i.e. CAGR) of 14.9%. In addition, Globe Life also met all filters in both my Basic Filters stock screener and my Earnings Growers stock screener. </div><p></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgSrQ2rA_rXS_7KBk_TRLiMwgCl7bfPOoUGw3gvL412JsrYSlxI0AU-asZZNfC6BHbh9ejYCxtxpyiJwfwAaQ40h_sqWoV4owH0ETD1XUmV8IMXsgsI2gtB_9An0EikhW7dXYt4oZfTuy66HSAaZ4Doanr6TiZgncOh2fc2-vpb0M7eSEbS22N1E88b3LA/s454/GL%20Future%205-Year%20PEG%20Ratio.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="332" data-original-width="454" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgSrQ2rA_rXS_7KBk_TRLiMwgCl7bfPOoUGw3gvL412JsrYSlxI0AU-asZZNfC6BHbh9ejYCxtxpyiJwfwAaQ40h_sqWoV4owH0ETD1XUmV8IMXsgsI2gtB_9An0EikhW7dXYt4oZfTuy66HSAaZ4Doanr6TiZgncOh2fc2-vpb0M7eSEbS22N1E88b3LA/s600/GL%20Future%205-Year%20PEG%20Ratio.png" width="600" /></a></div><br /> <br />
<b>As detailed below, two potential return-on-investment results for this Globe Life Inc. in-the-money Covered Calls position are: </b><br />
<p></p><ul>
<li><b> +2.0% absolute return-on-investment (equivalent to +92.8% annualized
return-on-investment for the next 8 days) if the stock is assigned early (on the last business day
prior to the April 4th ex-dividend date); or </b><b><br /></b></li>
</ul>
<ul>
<li><b>+2.3% absolute return-on-investment (equivalent to +35.8% annualized return-on-investment over the next 23 days) if the stock is assigned on the April 19th, 2024 options expiration date. </b></li>
</ul>
<br /><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj_6nXqXQ_BUIIbnliSvPo08nVztQjDkum09qBGNCmJU4nlLOEwY55udBGGdNcMhIGA4-j6nYkHBXk5UfrzNpNIm_4YblYr5WeIE6zSerPGVzh4viVfV44Vf1Kumm67366py96o0b1D6752VvV82psdM6aUJJdYSbZehkrsiEkQLDdoD9ttbT3YM2tkDJs/s539/Globe%20Life%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="93" data-original-width="539" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj_6nXqXQ_BUIIbnliSvPo08nVztQjDkum09qBGNCmJU4nlLOEwY55udBGGdNcMhIGA4-j6nYkHBXk5UfrzNpNIm_4YblYr5WeIE6zSerPGVzh4viVfV44Vf1Kumm67366py96o0b1D6752VvV82psdM6aUJJdYSbZehkrsiEkQLDdoD9ttbT3YM2tkDJs/s200/Globe%20Life%20logo.png" width="200" /></a></div>
<b>Globe Life Inc. (GL</b><b style="font-weight: bold;">) -- </b><b style="font-weight: bold;">New Covered Calls Position</b><br />
The buy/write transaction was:<br />3/27/2024 Bought 200 Globe Life shares @ $116.50.<br />3/27/2024 Sold 2 GL 4/19/2024 $110.00 Call options @ $8.70 per share. <br />4/4/2024 Upcoming annual ex-dividend of $.24 per share.<br />
<br />
Two possible overall performance results (including commissions) for this Globe Life Covered Calls position are as follows: <br />
Covered Calls Net Investment: $21,561.34<br />
= ($116.50 - $8.70) * 200 shares + $1.34 commission <br />
<br />
Net Profit Components:<br />
(a) Options Income: +$1,738.66<br />
= ($8.70 * 200 shares) - $1.34 commission <br />
(b) Dividend Income (If Globe Life Call options exercised early on April 3rd, 2024, the last business day prior to the April 4th ex-div date): +$0.00; or<br />
(b) Dividend Income (If stock assigned at the April 19th, 2024 options expiration date): +$48.00<br />
= ($.24 dividend per share x 200 shares)<br />
<div style="border: medium none;"><div class="separator" style="clear: both;">(c) Capital Appreciation (If Globe Life's Call options assigned early on April 3rd): -$1,300.00</div>
+($110.00 strike price - $116.50 stock purchase price) * 200 shares; or<br />
(c) Capital Appreciation (If shares assigned at $110.00 strike price at the April 19th options expiration): -$1,300.00<br />
+($110.00 - $116.50) * 200 shares </div>
<div style="border: medium none;">
<br /></div>
<div style="border: medium none;">
1. Total Net Profit [If option exercised early (business day prior to the April 4th ex-dividend date)]: +$438.66</div>
<div style="border: medium none;">
= (+$1,738.66 options income +$0.00 dividend income -$1,300.00 capital appreciation); or</div>
<div style="border: medium none;">
2. Total Net Profit (If Globe Life's shares assigned at $110.00 at the April 19th, 2024 expiration): +$486.66</div>
<div style="border: medium none;">
= (+$1,738.66 options income +$48.00 dividend income -$1,300.00 capital appreciation)<br />
<br />
<div style="border: medium none;">
1. Potential Absolute Return-on-Investment [If option exercised on business day prior to the April 4th, 2024 ex-dividend date]: +2.0%</div>
<div style="border: medium none;">
= +$438.66/$21,561.34</div>
<div style="border: medium none;">Potential Annualized Return-on-Investment (If option exercised early): +92.8%</div>
<div style="border: medium none;">
= (+$438.66/$21,561.34) * (365/8 days); or</div>
<div style="border: medium none;">
2. Potential Absolute Return-on-Investment (If Globe Life's shares assigned on the April 19th options expiration date): +2.3% </div>
<div style="border: medium none;">
= +$486.66/$21,561.34</div>
<div style="border: medium none;">Potential Annualized Return-on-Investment (If shares are assigned at $110.00 at the April 19th, 2024 options expiration date): +35.8%</div>
<div style="border: medium none;">
= (+$486.66/$21,561.34) * (365/23 days)</div>
</div>
<br />At least eight of the nine metrics used in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet (see below) should be 'YES' prior to establishing a new Covered Calls position using the Covered Calls Advisor's Dividend Capture strategy. As shown below, only seven of the nine criteria are achieved for this Globe Life Inc. Covered Calls position.
<div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEixeG4UXxG7eBlvFJTcSxX9ApyQbXDL6yIAC8CkyTwtC51apEyIzKTJbPQ2Hx0ZBohBbNyvhbHPk4whBhmwTWClvZVWJkc0FfjvPrXak2lZ20FlKsOnHsCSY9P8pP7de3VG20jkncQKVxyrylFytrU8B6Rkjgztg4cnPopsFQv_GK5KAEBQ61s2zR-oAFs/s840/GL%20div%20capt.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="713" data-original-width="840" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEixeG4UXxG7eBlvFJTcSxX9ApyQbXDL6yIAC8CkyTwtC51apEyIzKTJbPQ2Hx0ZBohBbNyvhbHPk4whBhmwTWClvZVWJkc0FfjvPrXak2lZ20FlKsOnHsCSY9P8pP7de3VG20jkncQKVxyrylFytrU8B6Rkjgztg4cnPopsFQv_GK5KAEBQ61s2zR-oAFs/s600/GL%20div%20capt.png" width="600" /></a></div>
<br />
<br /></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-88127474310898833722024-03-27T06:27:00.002-04:002024-03-27T06:27:36.488-04:00Early Assignment of Covered Calls Position in U.S. BancorpI was notified this morning that the five U.S. Bancorp (ticker USB) April 12th, 2024 $40.00 Call options were exercised yesterday. Because the U.S. Bancorp stock price increased from $42.15 when this position was established to $43.53 at yesterday's market close, the original $.29 time value in the Calls when the position was established had declined on yesterday's market close to $0.00, so the owner of these USB Calls exercised their option to buy the 500 shares at the $40.00 strike price in order to receive today's $.49 per share ex-dividend. The +32.5%
annualized-return-on-investment (aroi) achieved by early assignment is slightly greater
than the +29.6% aroi that might have been achieved if this position was
instead assigned on its April 12th options expiration
date. <b><b><b><br /></b></b></b><p>The post when this U.S. Bancorp Covered Calls position was originally established is <a href="https://coveredcallsadvisor.blogspot.com/2024/03/established-covered-calls-in-us-bancorp.html">here</a>.<b> As detailed below, t<b>he return-on-investment result for this U.S. Bancorp</b><b> Covered Calls position was </b></b><b><b><b><b><b><b>+0.7</b><b><b>%</b><b><b> absolute
return in 8 days (equivalent to a +32.5% annualized
return-on-investment)</b></b></b></b>.</b></b></b></b>
<br />
</p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg9w7wDvuV1BYw2pPf7h-ugMdpCIvF1u-G2Nxm6ViiMCzSlifdzQ5Kuqfz39dOKzAGRGQJXBod8D21WCgMmk6voM7grmlQIq-qg7xvnzCwxB_PaDeQxQwTrn7bHq0lVJeE8gna-rayskLjZ6Wmyy9jIXXrIAqeEFNNtzXe45HoHBzG77HaU-h41V0Ja4Qw/s530/USB%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="95" data-original-width="530" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg9w7wDvuV1BYw2pPf7h-ugMdpCIvF1u-G2Nxm6ViiMCzSlifdzQ5Kuqfz39dOKzAGRGQJXBod8D21WCgMmk6voM7grmlQIq-qg7xvnzCwxB_PaDeQxQwTrn7bHq0lVJeE8gna-rayskLjZ6Wmyy9jIXXrIAqeEFNNtzXe45HoHBzG77HaU-h41V0Ja4Qw/s200/USB%20logo.png" width="200" /></a></div>
<b>U.S. Bancorp </b><b style="font-weight: bold;">(USB) -- Early Assignment of C</b><b style="font-weight: bold;">overed Calls Position</b><br />
The buy/write transaction was:<br />3/19/2024 Bought 500 U.S. Bancorp shares @ $42.15.<br />3/19/2024 Sold 5 USB 4/12/2024 $40.00 Call options @ $2.44 per share.<br />
Note: Implied Volatility (IV) of the Call options was at 23.1 when this position was transacted which, as I prefer, is above the current VIX of 13.8. <br />3/27/2024 USB Call options owner exercised their five Call options, so the Covered Calls position was closed out early. The five GPC Call options expired worthless and the 500 U.S. Bancorp shares were sold at the $40.00 strike price.<br /><br />
The overall performance results (including commissions) for this U.S. Bancorp Covered Calls position are as follows: <br />
Covered Calls Net Investment: $19,858.35<br />
= ($42.15 - $2.44) * 500 shares + $3.35 commission <br />
<br />
Net Profit Components:<br />
(a) Options Income: +$1,216.65<br />
= ($2.44 * 500 shares) - $3.35 commission <br />
(b) Dividend Income (U.S. Bancorp Call options exercised early on March 26th, 2024, the last business day prior to the March 27th ex-div date): +$0.00<br /><div style="border: medium none;"><div class="separator" style="clear: both;">(c) Capital Appreciation: -$1,075.00</div>
+($40.00 strike price - $42.15 stock purchase price) * 500 shares<br /></div><div style="border: medium none;"><br /></div>
<div style="border: medium none;">Total Net Profit: +$141.65</div>
<div style="border: medium none;">
= (+$1,216.65 options income +$0.00 dividend income -$1,075.00 capital appreciation)</div><div style="border: medium none;">
<br />
<div style="border: medium none;">Absolute Return-on-Investment: +0.7%</div>
<div style="border: medium none;">
= +$141.65/$19,858.35</div>
<div style="border: medium none;">Annualized Return-on-Investment: +32.5%</div>
<div style="border: medium none;">
= (+$141.65/$19,858.35) * (365/8 days)</div></div><br /><p></p>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-65267246074827743332024-03-26T16:45:00.000-04:002024-03-26T16:45:16.969-04:00Covered Calls Position Established in Schlumberger Ltd.With less than one minute remaining in today's trading, my Covered Calls net debit limit order in Schlumberger Ltd. (now named SLB and also ticker symbol SLB) was transacted. Three hundred shares were purchased at $54.08 and three April 19th, 2024 Call options were sold at $2.48 per share at the $52.50 strike price. So, the corresponding potential time value (aka extrinsic value) profit potential is $.90 per share = [$2.48 Call options premium - ($54.08 stock purchase price - $52.50 strike price)]. Just prior to entering this position, I compared these Calls with their comparable Puts and found that the Calls provided $.20 per share higher time value, so this Covered Calls position was significantly more advantageous than a Cash-Secured Puts position would have been on an annualized-return-on-investment basis. <div><br /></div><div>An in-the-money Covered Calls position was established with the Delta of the Calls at 68.2 when this buy/write limit order transaction was executed, which approximates a 68.2% probability of assignment on the April 19th, 2024 options expiration date. There is no ex-dividend prior to the options expiration date. Their next quarterly earnings report is before market open on the April 19th, 2024 options expiration date, so to avoid normal earnings report stock price volatility, I will be looking for a fortuitous opportunity to close out this position prior to the 4/19 options expiration date.<div><br /></div><div><div>Schlumberger Ltd. is the world's leading oilfield services company, supplying technology, information
solutions and integrated project management services that optimize reservoir performance. Pertaining to portfolio diversification, I already had Covered Calls positions in six Sectors but none in Energy -- so this SLB Energy Sector position further diversifies my current holdings.</div><div> </div><div>As shown below, SLB meets all twenty-one filters in my Large-Cap Value+Profitability+Growth stock screener. I have circled in green three filter results that I found especially attractive. SLB also met all filters for three more of my stock screeners, namely Earnings Growers, Future 5-Year PEG Ratios, and Quality+Value+Growth. </div><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhJ7fBtdz0IxY8Up0TyDa7I28H63H-I3P_XRM-rdR4lCROfFCgRksWl5lai_m5q_ZH1jYo02kMGVKuYTikyiy7wR-dVYrdgp08u3j31D_3m5R6al1SdVLmz_h_2PNa41jZGdMalgoMFyPU-xS-WdEoswBxu4TesiyeP-s_YBfJwMRYSvOOxHQy792ecGfM/s555/SLB%20SR%20screener.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="449" data-original-width="555" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhJ7fBtdz0IxY8Up0TyDa7I28H63H-I3P_XRM-rdR4lCROfFCgRksWl5lai_m5q_ZH1jYo02kMGVKuYTikyiy7wR-dVYrdgp08u3j31D_3m5R6al1SdVLmz_h_2PNa41jZGdMalgoMFyPU-xS-WdEoswBxu4TesiyeP-s_YBfJwMRYSvOOxHQy792ecGfM/s600/SLB%20SR%20screener.png" width="600" /></a></div><div><br /></div><br /><div><b>Schlumberger Ltd. (SLB) -- New Covered Calls Position</b></div><div><div><div>The net debit buy/write limit order was executed as follows:<div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhZKqOVV0Y2uR_OKz4mxSJvpnMxo6kNNPF2-IEo6sI1rSmJKEdJdErgBkgoDVWBpkKhXI69e93E9MYrhyNI8DjhfhPjDjD3WqbvOWKpwGS2KEPuh5EaQNF5fsenVd1JJpC09znj4jKgu9hfxDyqG8dSeG3efwtCV1g0sCRCWa72S6bBk5XKmreoqhcNAYg/s268/SLB%20LOGO.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="188" data-original-width="268" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhZKqOVV0Y2uR_OKz4mxSJvpnMxo6kNNPF2-IEo6sI1rSmJKEdJdErgBkgoDVWBpkKhXI69e93E9MYrhyNI8DjhfhPjDjD3WqbvOWKpwGS2KEPuh5EaQNF5fsenVd1JJpC09znj4jKgu9hfxDyqG8dSeG3efwtCV1g0sCRCWa72S6bBk5XKmreoqhcNAYg/s200/SLB%20LOGO.png" width="200" /></a></div>3/26/2024 Bought 300 shares of SLB stock @ $54.08 per share. <br />3/26/2024 Sold 3 SLB April 19th, 2024 $52.50 Call options @ $2.48 per share. Note: the Implied Volatility of the Calls was 26.3 when this position was established. <br />
<br />A possible overall performance result (including commissions) for this position if it is in-the-money on the options expiration date is as follows: <br />Covered Calls Net Investment: $15,482.01<br />= ($54.08 - $2.48) * 300 shares + $2.01 commission</div><p>Net Profit Components: <br />
(a) Options Income: +$741.99<br />
= ($2.48 * 300 shares) - $2.01 commission <br />
(b) Dividend Income: +$0.00<br />(c) Capital Appreciation (If SLB stock is above the $52.50 strike price at the April 19th options expiration date): -$474.00<br />= ($52.50 strike price - $54.08 stock purchase price) * 300 shares</p><p>Potential Total Net Profit (If SLB is in-the-money and therefore assigned at expiration): +$267.99<br />= (+$741.99 options income + $0.00 dividend income - $474.00 capital appreciation)</p><p><b>Potential Absolute Return-on-Investment (If stock price is in-the-money and therefore assigned on the 4/19/2024 options expiration date): +1.7% </b>= +$267.99/$15,482.01</p><p><b>Potential Equivalent Annualized-Return-on-Investment: +26.3%</b><br />= (+$267.99/$15,482.01) * (365/24 days)</p><p><br /></p></div><div>
<p></p><p></p></div></div></div></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-14626932727649359042024-03-23T11:04:00.000-04:002024-03-23T11:04:41.059-04:00March 22nd, 2024 Weekly Options Expiration ResultsThe Covered Calls Advisor Portfolio had two Covered Calls positions with March 22nd, 2024 weekly options expirations. Both positions closed on their options expiration date yesterday with their equity prices in-the-money, so the Calls expired with no remaining value and the Covered Calls were closed out with the stocks sold at their respective strike prices. The original position and associated return-on-investment details for each position is as follows:<p>1. <b>Merck & Company Inc. (MRK</b><b>) -- +1.3</b><b>% absolute return-on-investment (equivalent to +31.0% annualized return-on-investment) for the 15 days of this investment. </b>This Merck position had a $121.00 strike price and it closed at $123.85 yesterday. The original position details are <a href="https://coveredcallsadvisor.blogspot.com/2024/03/established-covered-calls-in-merck-co.html">here</a>. </p><p>2. <b>Microsoft Corporation (MSFT</b><b>) -- </b><b>+1.3</b><b>% absolute return-on-investment (equivalent to +27.9% annualized return-on-investment) for the 17 days of this investment. </b>This Microsoft position had a $395.00 strike price and it closed at $428.74 yesterday. The original position details are <a href="https://coveredcallsadvisor.blogspot.com/2024/03/covered-call-position-established-in.html">here</a>.</p><p>As always, I welcome your questions at the email address shown below on any topics related to the Covered Calls investing strategy. </p><p>Jeff Partlow<br />The Covered Calls Advisor<br />partlow@cox.net</p><p><br /></p>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-53739511006080575612024-03-22T16:20:00.004-04:002024-03-22T16:29:55.725-04:00Established Covered Calls Position in Euronet Worldwide Inc.Late in this afternoon's trading session, a Covered Calls position was established in Euronet Worldwide Inc. (ticker EEFT). Two hundred shares were purchased at $108.22 and two April 19th, 2024 Call options were sold at the $105.00 strike price at $5.12 per share--a buy/write net debit transaction of $103.10 per share which provides a $1.90 per share time value profit potential. This Covered Calls position was preferable to its comparable Cash-Secured Puts position since the time value for the Puts was only $1.50 (versus the $1.90 obtained for these Calls). As preferred, there is no intervening quarterly earnings report prior to Euronet Worldwide's next report on 4/30/2024 which is after the 4/19/2024 options expiration date. <div><br /></div><div>Euronet Worldwide is a global financial tech solutions and payments provider that operates in these three segments: (1) Electronic Funds Transfer (EFT) supports financial institutions and consumers through Euronet-owned and outsourced ATMs and POS terminals combined with value-added and transaction processing services; (2) Epay provides retail payment solutions and delivers connections between the digital content of the brands and consumers; and (3) Money Transfer provides global money transfers and currency exchange information in retail stores, apps, and websites across 198 countries and territories. Euronet Worldwide is in the Information Technology sector. <br /><div><br /></div><div>The average Target Price of the analysts covering EEFT is $121.82 which is +12.6% above today's stock purchase price. It is the only company that appeared today in my Small-to-Mid-Cap Value+Profitability+Growth stock screener by meeting all 22 filters (see chart below). It is also rated with the highest average score of 10 by LSEG Stock Reports Plus which puts it in their top 5% of the North American stock exchanges universe covered.<div><br /><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiuOONIJMwPyMj1bdYJ6twJpHXSg4dEbvzz2QQH6n12S9gHpSn79QMBhfPO-VjJqrWNRYC5l7V3Og6HJpAIitfEheLhH0t75ho0Q4v0ieXANf84uRLy9mNmwmKAjOOKseOV4O1ZoCU0uCk7B8vOOI0AeiemBvOcWTVnRZBN_-roQ9Mts7ly1Hp5jZEuu6g/s521/EEFT%20VPG.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="465" data-original-width="521" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiuOONIJMwPyMj1bdYJ6twJpHXSg4dEbvzz2QQH6n12S9gHpSn79QMBhfPO-VjJqrWNRYC5l7V3Og6HJpAIitfEheLhH0t75ho0Q4v0ieXANf84uRLy9mNmwmKAjOOKseOV4O1ZoCU0uCk7B8vOOI0AeiemBvOcWTVnRZBN_-roQ9Mts7ly1Hp5jZEuu6g/s600/EEFT%20VPG.png" width="600" /></a></div></div><div><div div="" nbsp=""><p><b>As detailed below, a potential return-on-investment result is </b><b>+1.8% absolute return-on-investment (equivalent to +23.9% annualized
return-on-investment for the next 28 days) if the Euronet Worldwide Inc. share price is </b><b><b>in-the-money (i.e. above the $105.00 strike price) and therefore assigned on its April 19th, 2024 options expiration date.</b></b></p><p> <br /><b>Euronet Worldwide Inc. (EEFT) -- New Covered Calls Position</b> </p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgopKgzsgbmfYzBw6fGU1dCu3_ckd6MrvlN_v18KYGQKZJK41qQuEyu4GOMuisazD5Ylt1V1q_IiloeySAjggNYs5CKPmSOXjyOuK9O0VgxV3ZxpRYpGcS9LZncvyYHdu9ZusXqOBuYrh081CEzPOxEFJPckC-nDYPEtPOTH8qEkoFMJC7n-cwGCLCVDKY/s280/EEFT%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="180" data-original-width="280" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgopKgzsgbmfYzBw6fGU1dCu3_ckd6MrvlN_v18KYGQKZJK41qQuEyu4GOMuisazD5Ylt1V1q_IiloeySAjggNYs5CKPmSOXjyOuK9O0VgxV3ZxpRYpGcS9LZncvyYHdu9ZusXqOBuYrh081CEzPOxEFJPckC-nDYPEtPOTH8qEkoFMJC7n-cwGCLCVDKY/s200/EEFT%20logo.png" width="200" /></a></div>The Buy/Write transaction was as follows:<br />3/22/2024 Bought 200 shares of Euronet Worldwide Inc. @ $108.22 per share. <br />3/22/2024 Sold 2 EEFT April 19th, 2024 $105.00 Call options @ $5.12 per share. The Implied Volatility of these Call options was 23.3 and the Delta was 68.9 when this transaction was executed. <p></p><p>
A possible overall performance result (including commissions) for this Euronet Worldwide Inc. Covered Calls position is as follows: <br />Covered Calls Net Investment: $20,621.34<br />
= ($108.22 - $5.12) * 200 shares + $1.34 commission<br />
<br />
Net Profit:<br />
(a) Options Income: +$1,022.66<br />
= ($5.12 * 200 shares) - $1.34 commission <br />(b) Dividend Income: +$0.00<br />
(c) Capital Appreciation (If 200 Euronet Worldwide Inc. shares assigned at $105.00 strike price at expiration): -$644.00 <br />
+($105.00 - $108.22) * 200 shares<br /><br />
Total Net Profit Potential (If 200 Euronet Worldwide shares assigned at $105.00 strike price at expiration): +$378.66<br />
= (+$1,022.66 options income +$0.00 dividend income -$644.00 capital appreciation)</p><p>Potential Absolute Return-on-Investment: +1.8%<br />
= +$378.66/$20,621.34<br />Potential Annualized Return-on-Investment: +23.9%<br />
= (+$378.66/$20,621.34) * (365/28 days)</p></div></div></div></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-63817980360368927662024-03-20T14:02:00.001-04:002024-03-20T14:02:34.874-04:00Established Covered Calls Position in Amdocs Ltd.Late this morning my buy/write limit order was executed in Amdocs Ltd. (ticker DOX) to buy 200 shares and simultaneously sell 2 Call options at the April 19th, 2024 monthly options expiration date and at the $90.00 strike price. The net debit limit price for my order was $88.90 which was executed when 200 shares were purchased at $91.53 and 2 April 19th, 2024 Call options were sold for $2.63 per share. Therefore, a maximum potential time value profit of $1.10 per share = [$2.63 Call options premium - ($91.53 stock price - $90.00 strike price)] is possible for this position. <br /><br /><div>This position uses the Covered Calls Advisor's Dividend Capture Strategy (see <a href="https://coveredcallsadvisor.blogspot.com/2023/01/the-covered-calls-advisors-dividend.html">here</a>) since Amdocs Ltd. has an upcoming quarterly ex-dividend of $.48 per share (2.1% annual dividend yield) one week from today on March 27th which is prior to the April 19th options expiration date. I am encouraged by the increase in their annual dividend from $.40 last year to $.44 now (a 9.0% increase). This dividend is included in the detailed return-on-investment calculations below. Either an early assignment on March 26th (the last trading day prior to the March 27th ex-dividend date) or on the April 19th options expiration date would provide a satisfactory annualized return on investment result for this position. As shown on the table at the bottom of this post, all nine criteria of the Dividend Capture Strategy are met with this position. The Delta for these Call options was approximately 67.6 when this position was established which approximates the probability of 67.6% that the position will be in-the-money at market close on the options expiration date. Also, importantly to the Covered Calls Advisor, there is no quarterly earnings report prior to the options expiration date since the next earnings report on May 15th, 2024 is after the April 19th options expiration date.</div><div><br />Amdocs Ltd. provides software and services primarily to communications and media companies worldwide. Their services include end-to-end integration, digital business operations, engineering support, cloud services, and consulting services. According to LSEG (Refinitiv), there are 15 analysts covering Amdocs Ltd. and their current average Target Price is $104.90 which is +14.6% above today's stock purchase price. Another reason for establishing this position was that Amdocs is highly ranked in my Stock Rover Overall stock screener since it met all 14 filters (see chart below). It also met all 18 filters in my Quality+Value+Growth stock screener. </div><p></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiraZrWMdzt_1mfoUudtHPiWwKdZoJgbT_moxYtffQmTGPxD_Evmspe4eZgjQGYZKoRH_3bNzfEZ45W1x9XRgpSo7bJM8rGz97r2s_aT_YaLVT7QJ277cHV5w1deT83l2EZrECnDazezwxSujVLGvogh0m8Njhyphenhyphen2qpXINDnZqqz-ExHOcBLzhRZ2Oz1YKE/s575/DOX%20SR%20Overall.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="575" data-original-width="502" height="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiraZrWMdzt_1mfoUudtHPiWwKdZoJgbT_moxYtffQmTGPxD_Evmspe4eZgjQGYZKoRH_3bNzfEZ45W1x9XRgpSo7bJM8rGz97r2s_aT_YaLVT7QJ277cHV5w1deT83l2EZrECnDazezwxSujVLGvogh0m8Njhyphenhyphen2qpXINDnZqqz-ExHOcBLzhRZ2Oz1YKE/s600/DOX%20SR%20Overall.png" /></a></div><br /> <br />
<b>As detailed below, two potential return-on-investment results for this Amdocs Ltd. in-the-money Covered Calls position are:</b><b> </b><br />
<p></p><ul>
<li><b> +1.2% absolute return-on-investment (equivalent to +64.1% annualized
return-on-investment for the next 7 days) if the stock is assigned early (on the last business day
prior to the March 27th ex-dividend date); or </b><b><br /></b></li>
</ul>
<ul>
<li><b>+1.8% absolute return-on-investment (equivalent to +21.5% annualized return-on-investment over the next 30 days) if the stock is assigned on the April 19th, 2024 options expiration date. </b></li>
</ul>
<br /><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhrzKvrP_A8xKZMekswKihTOX5caITz8O8fuWcYx5SKNI94Vdy1YsyAUxP_GYukCWXvZYdPjRzDLNx4RLjyOqlsH7c3rzEaYTrWhZM5KPIcd8AKyj2dmgAiHhpFcWg3zwgNxYyIUfRIpaG7o7AuH7WReU3dP8ofwYJ1mxssRqowlfb7CGuH1bzWBW7jmDE/s481/DOX%20logo.png" style="display: block; padding: 1em 0; text-align: center; clear: right; float: right;"><img alt="" border="0" width="200" data-original-height="105" data-original-width="481" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhrzKvrP_A8xKZMekswKihTOX5caITz8O8fuWcYx5SKNI94Vdy1YsyAUxP_GYukCWXvZYdPjRzDLNx4RLjyOqlsH7c3rzEaYTrWhZM5KPIcd8AKyj2dmgAiHhpFcWg3zwgNxYyIUfRIpaG7o7AuH7WReU3dP8ofwYJ1mxssRqowlfb7CGuH1bzWBW7jmDE/s200/DOX%20logo.png"/></a></div>
<b>Amdocs Ltd.JD. (DOX</b><b style="font-weight: bold;">) -- </b><b style="font-weight: bold;">New Covered Calls Position</b><br />
The buy/write transaction was:<br />3/20/2024 Bought 200 Amdocs Ltd. shares @ $91.53.<br />3/20/2024 Sold 2 DOX 4/19/2024 $90.00 Call options @ $2.63 per share. <br />3/27/2024 Upcoming annual ex-dividend of $.48 per share.<br />
<br />
Two possible overall performance results (including commissions) for this Amdocs Ltd. Covered Calls position are as follows: <br />
Covered Calls Net Investment: $17,781.34<br />
= ($91.53 - $2.63) * 200 shares + $1.34 commission <br />
<br />
Net Profit Components:<br />
(a) Options Income: +$524.66<br />
= ($2.63 * 200 shares) - $1.34 commission <br />
(b) Dividend Income (If Amdocs Call options exercised early on March 26th, 2024, the last business day prior to the March 27th ex-div date): +$0.00; or<br />
(b) Dividend Income (If stock assigned at the April 19th, 2024 options expiration date): +$96.00<br />
= ($.48 dividend per share x 200 shares)<br />
<div style="border: medium none;"><div class="separator" style="clear: both;">(c) Capital Appreciation (If Amdocs' Call options assigned early on March 27th): -$306.00</div>
+($90.00 strike price - $91.53 stock purchase price) * 200 shares; or<br />
(c) Capital Appreciation (If shares assigned at $90.00 strike price at the April 19th options expiration): -$306.00<br />
+($90.00 - $91.53) * 200 shares </div>
<div style="border: medium none;">
<br /></div>
<div style="border: medium none;">
1. Total Net Profit [If option exercised early (business day prior to the March 27th ex-dividend date)]: +$218.66</div>
<div style="border: medium none;">
= (+$524.66 options income +$0.00 dividend income -$306.00 capital appreciation); or</div>
<div style="border: medium none;">
2. Total Net Profit (If Amdocs' shares assigned at $90.00 at the April 19th, 2024 expiration): +$314.66</div>
<div style="border: medium none;">
= (+$524.66 options income +$96.00 dividend income -$306.00 capital appreciation)<br />
<br />
<div style="border: medium none;">
1. Potential Absolute Return-on-Investment [If option exercised on business day prior to the March 27th, 2024 ex-dividend date]: +1.2%</div>
<div style="border: medium none;">
= +$218.66/$17,781.34</div>
<div style="border: medium none;">Potential Annualized Return-on-Investment (If option exercised early): +64.1%</div>
<div style="border: medium none;">
= (+$218.66/$17,781.34) * (365/7 days); or</div>
<div style="border: medium none;">
2. Potential Absolute Return-on-Investment (If Amdocs' shares assigned on the April 19th options expiration date): +1.8% </div>
<div style="border: medium none;">
= +$314.66/$17,781.34</div>
<div style="border: medium none;">Potential Annualized Return-on-Investment (If shares are assigned at $90.00 at the April 19th, 2024 options expiration date): +21.5%</div>
<div style="border: medium none;">
= (+$314.66/$17,781.34) * (365/30 days)</div>
</div>
<br />At least eight of the nine metrics used in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet (see below) must be 'YES' prior to establishing a new Covered Calls position using the Covered Calls Advisor's Dividend Capture strategy. As shown below, all nine criteria are achieved for this Amdocs Ltd. Covered Calls position.
<div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgVn_f2fOutGl3WQsyz6xn-M5QGRkdpfCOneqJDIIoGpDoTxbyaWlb_ON6M-qu_gJ40H6YTYpIuQzzR6ZEafvE-GBM_hVbj3RiO9faqbtWLOEJb0nLl3yMAvt5UNHhk6BLrxOG_b8XGBXSQoYDh5OMRONmTyZt44LDns38jR2suRh0dcJzvHF0hOKbttWM/s840/DOX%20div%20capt.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="713" data-original-width="840" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgVn_f2fOutGl3WQsyz6xn-M5QGRkdpfCOneqJDIIoGpDoTxbyaWlb_ON6M-qu_gJ40H6YTYpIuQzzR6ZEafvE-GBM_hVbj3RiO9faqbtWLOEJb0nLl3yMAvt5UNHhk6BLrxOG_b8XGBXSQoYDh5OMRONmTyZt44LDns38jR2suRh0dcJzvHF0hOKbttWM/s600/DOX%20div%20capt.png" width="600" /></a></div>
<br />
<br />JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-70672645543266957182024-03-20T12:55:00.002-04:002024-03-20T13:26:02.971-04:00Established Covered Calls Position in JD.com Inc.This morning my buy/write limit order was executed in JD.com Inc. (ticker JD) to buy 400 shares and simultaneously sell 4 Call options at the April 19th, 2024 monthly options expiration date and at the $26.50 strike price. The net debit limit price for my order was $25.86 which was executed when 400 shares were purchased at $27.86 and 4 April 19th, 2024 Call options were sold for $2.00 per share. Therefore, a maximum potential time value profit of $.64 per share = [$2.00 Call options premium - ($27.86 stock price - $26.50 strike price)] is available for this position. <br /><br /><div>This position uses the Covered Calls Advisor's Dividend Capture Strategy (see <a href="https://coveredcallsadvisor.blogspot.com/2023/01/the-covered-calls-advisors-dividend.html">here</a>) since JD.com has an upcoming annual ex-dividend of $.76 per share (11.0% annual dividend yield) on Thursday, April 4th which is prior to the April 19th options expiration date. I am encouraged by the increase in their annual dividend from $.62 last year to $.76 now (a 22.6% increase). This dividend is included in the detailed return-on-investment calculations below. Either an early assignment on April 3rd (the last trading day prior to the April 4th ex-dividend date) or on the April 19th options expiration date would provide excellent annualized return on investment results for either outcome. As shown on the table at the bottom of this post, all nine criteria of the Dividend Capture Strategy are met with this position. The Delta for these Call options was approximately 70.1 when this position was established which approximates the probability of 70.1% that the position will be in-the-money at market close on the options expiration date. Also, importantly to the Covered Calls Advisor, there is no quarterly earnings report prior to the options expiration date since the next earnings report on May 9th, 2024 is after the April 19th options expiration date.</div><div><br />JD.com is a holding company engaged in e-commerce businesses primarily in China, so it is included in the Consumer Discretionary sector. Its primary business is its retail segment which, through its own online platform, sells electronics, home appliances, and many other general merchandise categories. On this platform it also provides marketing and advertising services to third-party merchants. In its other business it offers comprehensive logistics services including warehousing, transportation, deliveries, and post-sales services. </div><p>According to LSEG (Refinitiv), there are 39 Wall Street analysts covering JD.com and their current average Target Price is $38.60 which is +38.5% above today's stock purchase price. Another reason for establishing this position was that JD.com is highly ranked in my Quality +Value +Growth stock screener since it met all 18 filters (see chart below). </p><p></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgpRtwcehIFl8AlDJZHcx5tiAbFmFZqqwdY4XU_IbSRlrkCb88DO2vhSjEpoKH2_197imASl9WmkfhwVJdbA7Oksjw1Q7cLbUMRzevu82HecGyFto_j84vikbRL8uKhFB2qjzXlC1IoiXzziQndxq9-k8CmYdZKYlXeTWim_UA_gXno53w6dmvcYrmx3DQ/s449/JD%20Q+V+G.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="398" data-original-width="449" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgpRtwcehIFl8AlDJZHcx5tiAbFmFZqqwdY4XU_IbSRlrkCb88DO2vhSjEpoKH2_197imASl9WmkfhwVJdbA7Oksjw1Q7cLbUMRzevu82HecGyFto_j84vikbRL8uKhFB2qjzXlC1IoiXzziQndxq9-k8CmYdZKYlXeTWim_UA_gXno53w6dmvcYrmx3DQ/s600/JD%20Q+V+G.png" width="600" /></a></div><br /> <br />
<b>As detailed below, two potential return-on-investment results for this in-the-money Covered Calls position are:</b><b> </b><br />
<p></p><ul>
<li><b> +2.4% absolute return-on-investment (equivalent to +59.6% annualized
return-on-investment for the next 15 days) if the stock is assigned early (on the last business day
prior to the April 4th ex-dividend date); or </b><b><br /></b></li>
</ul>
<ul>
<li><b>+5.4% absolute return-on-investment (equivalent to +65.5% annualized return-on-investment over the next 30 days) if the stock is assigned on the April 19th, 2024 options expiration date. </b></li>
</ul>
<br /><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiYyXL9hCCGzbukRN31fHvKr0fyVbY4KiTQmFjCkZPOTQkfxoqbgXjQESPgXQw1RIlEYyLX8PHQ5FjxlyRXtE5rngkRMUW4P52eUvLcgZvSX9lZi823zvs1T-VlaTXjIRP92A8lF7Sw_3auQU0jC1H9Zz9kgmYa8-LwplNvc3xSdgKAcl4GCCdO3VS0HFo/s225/JD.com%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="225" data-original-width="225" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiYyXL9hCCGzbukRN31fHvKr0fyVbY4KiTQmFjCkZPOTQkfxoqbgXjQESPgXQw1RIlEYyLX8PHQ5FjxlyRXtE5rngkRMUW4P52eUvLcgZvSX9lZi823zvs1T-VlaTXjIRP92A8lF7Sw_3auQU0jC1H9Zz9kgmYa8-LwplNvc3xSdgKAcl4GCCdO3VS0HFo/s200/JD.com%20logo.png" width="200" /></a></div>
<b>JD.com Inc. </b><b style="font-weight: bold;">(JD) -- </b><b style="font-weight: bold;">New Covered Calls Position</b><br />
The buy/write transaction was:<br />3/20/2024 Bought 400 JD.com shares @ $27.86.<br />3/20/2024 Sold 4 JD.com 4/19/2024 $26.50 Call options @ $2.00 per share. The Implied Volatility of these Call options was 35.7 when this position was established which, as I prefer, is well above the current 13.8 of the S&P 500 Volatility Index (i.e. VIX).<br />4/4/2024 Upcoming annual ex-dividend of $.76 per share.<br />
<br />
Two possible overall performance results (including commissions) for this JD.com Covered Calls position are as follows: <br />
Covered Calls Net Investment: $10,346.68<br />
= ($27.86 - $2.00) * 400 shares + $2.68 commission <br />
<br />
Net Profit Components:<br />
(a) Options Income: +$797.32<br />
= ($2.00 * 400 shares) - $2.68 commission <br />
(b) Dividend Income (If JD.com Call options exercised early on April 3rd, 2024, the last business day prior to the April 4th ex-div date): +$0.00; or<br />
(b) Dividend Income (If stock assigned at the April 19th, 2024 options expiration date): +$304.00<br />
= ($.76 dividend per share x 400 shares)<br />
<div style="border: medium none;"><div class="separator" style="clear: both;">(c) Capital Appreciation (If JD.com's Call options assigned early on April 3rd): -$544.00</div>
+($26.50 strike price - $27.86 stock purchase price) * 400 shares; or<br />
(c) Capital Appreciation (If shares assigned at $26.50 strike price at the April 19th options expiration): -$544.00<br />
+($26.50 - $27.86) * 400 shares </div>
<div style="border: medium none;">
<br /></div>
<div style="border: medium none;">
1. Total Net Profit [If option exercised early (business day prior to the April 4th ex-dividend date)]: +$253.32</div>
<div style="border: medium none;">
= (+$797.32 options income +$0.00 dividend income -$544.00 capital appreciation); or</div>
<div style="border: medium none;">
2. Total Net Profit (If JD.com's shares assigned at $26.50 at the April 19th, 2024 expiration): +$557.32</div>
<div style="border: medium none;">
= (+$797.32 options income +$304.00 dividend income -$544.00 capital appreciation)<br />
<br />
<div style="border: medium none;">
1. Potential Absolute Return-on-Investment [If option exercised on business day prior to the 4/4/2024 ex-dividend date]: +2.4%</div>
<div style="border: medium none;">
= +$253.32/$10,346.68</div>
<div style="border: medium none;">Potential Annualized Return-on-Investment (If option exercised early): +59.6%</div>
<div style="border: medium none;">
= (+$253.32/$10,346.68) * (365/15 days); or</div>
<div style="border: medium none;">
2. Potential Absolute Return-on-Investment (If JD.com's shares assigned on the April 19th options expiration date): +5.4% </div>
<div style="border: medium none;">
= +$557.32/$10,346.68</div>
<div style="border: medium none;">Potential Annualized Return-on-Investment (If shares are assigned at $26.50 at the April 19th, 2024 options expiration date): +65.5%</div>
<div style="border: medium none;">
= (+$557.32/$10,346.68) * (365/30 days)</div>
</div>
<br />At least eight of the nine metrics used in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet (see below) must be 'YES' prior to establishing a new Covered Calls position using the Covered Calls Advisor's Dividend Capture strategy. As shown below, all nine criteria are achieved for this JD.com Inc. Covered Calls position.
<div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEizMY7Lgo7th3QwHewmCTt79bkqpe3UJpSo7sPjTkdj-gamVzfYbGHhqad28uT_XDFRJRcGuiZDuV9HKwElAxT01IHXChWib3RpIxSzVst-Q4znQ6C2tcFMpEclSth9Xr4uWxQpb3DZGJWk3QvgaZaPSJ70JiyWcWaupbDlMsFlIapz_zjLPNKk4pbvOs4/s840/JD%20div%20capt.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="713" data-original-width="840" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEizMY7Lgo7th3QwHewmCTt79bkqpe3UJpSo7sPjTkdj-gamVzfYbGHhqad28uT_XDFRJRcGuiZDuV9HKwElAxT01IHXChWib3RpIxSzVst-Q4znQ6C2tcFMpEclSth9Xr4uWxQpb3DZGJWk3QvgaZaPSJ70JiyWcWaupbDlMsFlIapz_zjLPNKk4pbvOs4/s600/JD%20div%20capt.png" width="600" /></a></div>
<br />
<br />JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-66351898742685759472024-03-19T16:54:00.005-04:002024-03-20T08:40:35.100-04:00Established Covered Calls in U.S. BancorpA buy/write limit order was entered in U.S. Bancorp (ticker USB) to buy 500 shares and simultaneously sell 5 Call options at the April 12th, 2024 weekly options expiration date and at the $40.00 strike price. The net debit limit price for my order was $39.71 and this order was executed at 3:30pm when 500 shares were purchased at $42.15 and 5 April 12th, 2024 Call options were sold for $2.44 per share. Therefore, a maximum potential time value profit of $.29 per share = [$2.44 options premium - ($42.15 stock price - $40.00 strike price)] is available for this position. <br /><br /><div>This position uses the Covered Calls Advisor's Dividend Capture Strategy since U.S. Bancorp has an upcoming quarterly ex-dividend of $.49 per share on March 27th which is prior to the April 12th options expiration date. This is equivalent to an absolute annual dividend yield of 4.7% and an equivalent annualized dividend yield of 17.7% = [($.49/$42.15) x (365/24 days to expiration)]. This dividend is included in the detailed return-on-investment calculations below. Either an early assignment next week on the last trading day prior to the 3/27/2024 ex-dividend date) or on the April 12th options expiration date would be desirable to the Covered Calls Advisor given the potential annualized return on investments for either outcome. Importantly to the Covered Calls Advisor, there is no quarterly earnings report prior to the options expiration date since the next earnings report on April 17th, 2024 is after the April 12th, 2024 options expiration date.<p><br /></p><p>
<b>As detailed below, two potential return-on-investment results are:</b><b> </b><br />
</p><ul>
<li><b> +0.7% absolute return (equivalent to +32.5</b><b>% annualized
return-on-investment for the next 8 days) if the stock is assigned early (on the last business day
prior to the March 27th ex-dividend date); or </b></li>
</ul>
<ul>
<li><b>+1.9% absolute return (equivalent to +29.6% annualized return-on-investment over the next 24 days) if the stock is assigned on the April 12th, 2024 options expiration date. </b></li>
</ul>
<br />
<div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg9w7wDvuV1BYw2pPf7h-ugMdpCIvF1u-G2Nxm6ViiMCzSlifdzQ5Kuqfz39dOKzAGRGQJXBod8D21WCgMmk6voM7grmlQIq-qg7xvnzCwxB_PaDeQxQwTrn7bHq0lVJeE8gna-rayskLjZ6Wmyy9jIXXrIAqeEFNNtzXe45HoHBzG77HaU-h41V0Ja4Qw/s530/USB%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="95" data-original-width="530" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg9w7wDvuV1BYw2pPf7h-ugMdpCIvF1u-G2Nxm6ViiMCzSlifdzQ5Kuqfz39dOKzAGRGQJXBod8D21WCgMmk6voM7grmlQIq-qg7xvnzCwxB_PaDeQxQwTrn7bHq0lVJeE8gna-rayskLjZ6Wmyy9jIXXrIAqeEFNNtzXe45HoHBzG77HaU-h41V0Ja4Qw/s200/USB%20logo.png" width="200" /></a></div>
<b>U.S. Bancorp </b><b style="font-weight: bold;">(USB) -- </b><b style="font-weight: bold;">New Covered Calls Position</b><br />
The buy/write transaction was:<br />3/19/2024 Bought 500 U.S. Bancorp shares @ $42.15.<br />3/19/2024 Sold 6 USB 4/12/2024 $40.00 Call options @ $2.44 per share.<br />
Note: Implied Volatility (IV) of the Call options was at 23.1 when this position was transacted which, as I prefer, is above the current VIX of 13.8. <br />3/27/2024 Upcoming quarterly ex-dividend of $.49 per share.<br />
<br />
Two possible overall performance results (including commissions) for this U.S. Bancorp Covered Calls position are as follows: <br />
Covered Calls Net Investment: $19,858.35<br />
= ($42.15 - $2.44) * 500 shares + $3.35 commission <br />
<br />
Net Profit Components:<br />
(a) Options Income: +$1,216.65<br />
= ($2.44 * 500 shares) - $3.35 commission <br />
(b) Dividend Income (If U.S. Bancorp Call options exercised early on March 26th, 2024, the last business day prior to the March 27th ex-div date): +$0.00; or<br />
(b) Dividend Income (If U.S. Bancorp stock assigned at the April 12th, 2024 options expiration): +$245.00<br />
= ($.49 dividends per share x 500 shares)<br />
<div style="border: medium none;"><div class="separator" style="clear: both;">(c) Capital Appreciation (If U.S. Bancorp's Call options assigned early on March 27th): -$1,075.00</div>
+($40.00 strike price - $42.15 stock purchase price) * 500 shares; or<br />
(c) Capital Appreciation (If shares assigned at $40.00 strike price at the 4/12/2024 options expiration): -$1,075.00 <br />
+($40.00 - $42.15) * 500 shares </div>
<div style="border: medium none;">
<br /></div>
<div style="border: medium none;">
1. Total Net Profit [If option exercised early (business day prior to the March 27th ex-dividend date)]: +$141.65</div>
<div style="border: medium none;">
= (+$1,216.65 options income +$0.00 dividend income -$1,075.00 capital appreciation); or</div>
<div style="border: medium none;">
2. Total Net Profit (If 500 U.S. Bancorp shares assigned at the $40.00 strike price at the April 12th, 2024 expiration): +$386.65</div>
<div style="border: medium none;">
= (+$1,216.65 options income +$245.00 dividend income -$1,075.00 capital appreciation)<br />
<br />
<div style="border: medium none;">
1. Potential Absolute Return-on-Investment [If option exercised on business day prior to the 3/27/2024 ex-dividend date]: +0.7%</div>
<div style="border: medium none;">
= +$141.65/$19,858.35</div>
<div style="border: medium none;">Potential Annualized Return-on-Investment (If option exercised early): +32.5%</div>
<div style="border: medium none;">
= (+$141.65/$19,858.35) * (365/8 days); or</div>
<div style="border: medium none;">
2. Potential Absolute Return-on-Investment (If U.S. Bancorp's shares assigned on the April 12th options expiration date): +1.9% </div>
<div style="border: medium none;">
= +$386.65/$19,858.35</div>
<div style="border: medium none;">Potential Annualized Return-on-Investment (If 500 U.S. Bancorp shares assigned at $40.00 at the April 12th, 2024 expiration): +29.6%</div>
<div style="border: medium none;">
= (+$386.65/$19,858.35) * (365/24 days)</div>
</div>
<br /><br /></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-36038473798825390402024-03-19T16:24:00.001-04:002024-03-20T08:45:25.335-04:00Covered Calls Position Established in Mondelez International Inc.This afternoon, my buy/write limit order in Mondelez International Inc. (ticker MDLZ) was executed. My net debit limit price of $70.60 was executed when three hundred shares were purchased at $72.25 and three April 5th, 2024 Call options were sold at $1.65 per share at the $71.00 strike price. The potential time value profit was $.40 per share = [$71.00 strike price - ($72.25 stock purchase price - $1.65 Call options price)]. An in-the-money Covered Calls position was established with a Delta of 75.0 which approximates a 75.0% probability this position will be in-the-money and therefore assigned on the April 5th, 2024 options expiration date. As desired, the next quarterly earnings report on April 25th is after the Apr 5th options expiration date.<br /><p></p><p>Mondelez has an upcoming ex-dividend of $.425 per share (2.4% dividend yield at the current stock price) on March 27th which is prior to the April 5th options expiration date, so this dividend is included in the potential return-on-investment results shown below. As shown on the chart at the bottom of this post, all seven of the nine criteria in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet were met for this position. </p><p>As shown in the detailed chart below, Mondelez meets all 14 filters of my StockRover Overall stock screener. There were 40 companies that met all 14 filters, but Mondelez was one of only two companies in the Consumer Staples sector that met all 14 filters. There are 26 Wall Street analysts that follow Mondelez. Their average price target is $83.96 which is +16.1% above today's stock purchase price. Twenty-five analysts rate them as either a Strong Buy or Buy, one rates it as a Hold, and zero analysts rate it as a Sell or Strong Sell. The one-year Beta is 0.41.</p><p></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhvWqwtlDUac_EpEnLVmnwZO75wplvnj1DUNAE_JY5EMRxNa_i1KwtW_xE2ABzPugfxJY-DxxsPcJ9pkwcw-0foFrKpj7kVYlf3v0bn78k5L0g-jVaGo8eatuetiLLI0Bi5oqlqBq5KFXS-tNMOjm4EntGOsP6I5-IQvUCtKz733kkrkwV5pnBWaRwtRbw/s496/MDLZ%20SR%20Overall.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="329" data-original-width="496" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhvWqwtlDUac_EpEnLVmnwZO75wplvnj1DUNAE_JY5EMRxNa_i1KwtW_xE2ABzPugfxJY-DxxsPcJ9pkwcw-0foFrKpj7kVYlf3v0bn78k5L0g-jVaGo8eatuetiLLI0Bi5oqlqBq5KFXS-tNMOjm4EntGOsP6I5-IQvUCtKz733kkrkwV5pnBWaRwtRbw/s600/MDLZ%20SR%20Overall.png" width="600" /></a></div><p><b>Two potential return-on-investment results are: (a) +0.6% absolute return-on-investment (equivalent to +25.4% annualized
return-on-investment for the next 8 days) if the stock is assigned early (on the last trading day prior to the March 27th, 2024 ex-dividend date); OR (b) +1.2%
absolute return-on-investment (equivalent to +24.9% annualized return-on-investment over the next 17 days) if the stock is assigned on the April 5th, 2024 options expiration date. </b></p><p><br /><b><b><br /></b></b></p><p><b>Mondelez International Inc.<b> (MDLZ) </b></b><b>-- </b><b>New Covered Calls Position</b></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg0hLH40cU5GfhkkPNhyphenhyphenqDNineI6Kim4J5iiiZbct69SpAkTjmgBdoI0Ol7rSiBOTpU7wj9X_2ynD_sBPWeYS-raVlMY3ZkveI7O9WfDwRfr6jhan54RD8Jdv1vG_v2NO218lf5qm1pI1eB7o2Yuv6Z-r4qKmpRDl5EZCd7C6ciLc4NkuOYVBjrqXuTwSs/s453/MDLZ%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="111" data-original-width="453" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg0hLH40cU5GfhkkPNhyphenhyphenqDNineI6Kim4J5iiiZbct69SpAkTjmgBdoI0Ol7rSiBOTpU7wj9X_2ynD_sBPWeYS-raVlMY3ZkveI7O9WfDwRfr6jhan54RD8Jdv1vG_v2NO218lf5qm1pI1eB7o2Yuv6Z-r4qKmpRDl5EZCd7C6ciLc4NkuOYVBjrqXuTwSs/s200/MDLZ%20logo.png" width="200" /></a></div>The buy/write transaction was:<br />3/19/2024 Bought 300 Mondelez shares @ $72.25<br />3/19/2024 Sold 2 MDLZ 4/5/2024 $71.00 Call options @ $1.65 per share<b>. </b>The Implied Volatility of these Calls was 11.9 when this position was established.<br /><br />
Two possible overall performance results (including commissions) would be as follows: <br />
Covered Calls Net Investment: $21,182.01<br />= ($72.25 - $1.65) * 300 shares + $2.01 commission<p></p><p></p>
Net Profit Components: <br />
(a) Options Income: +$492.99<br />
= ($1.65 * 300 shares) - $2.01 commission<br />
(b) Dividend Income (If Mondelez shares assigned on 3/26/2024, the business day prior to the 3/27/2024 ex-dividend date): = +$0.00; or<br />
(b) Dividend Income (If MDLZ shares assigned at the 4/5/2024 options expiration date): +$127.50<br />
= $.425 per share x 300 shares <br />
(c) Capital Appreciation (If Mondelez shares assigned early on 3/26/2024): -$375.00 <br />
= ($71.00 strike price -$72.25 stock purchase price) * 300 shares; or<br />
(c) Capital Appreciation (If MDLZ shares assigned with stock above the $71.00 strike price at the April 5th options expiration): -$375.00 <br />
= ($71.00 -$72.25) * 300 shares<br />
<br />
1. Potential Net Profit (If Mondelez shares assigned on 3/26/2024, the day prior to the March 27th ex-dividend date): +$117.99<br />
= (+$492.99 options income +$0.00 dividend income - $375.00 capital appreciation)<br />
2. Potential Net Profit (If Mondelez price is above $71.00 strike price at the April 5th options expiration): +$245.49<br />
= (+$492.99 options income +$127.50 dividend income - $375.00 capital appreciation)<br />
<br />
1. Absolute Return-on-Investment (If Mondelez shares assigned early on 3/26/2024, the day prior to the March 27th, 2024 ex-dividend date): +0.6%<br />
= +$117.99/$21,182.01<br />
Equivalent Annualized Return-on-Investment (If assigned early on day prior to ex-div date): +25.4% <br />
= (+$117.99/$21,182.01) * (365/8 days)<p></p><p>
2. Absolute Return-on-Investment (If MDLZ price is above $71.00 strike price at the April 5th options expiration date): +1.2%<br />
= +$245.49/$21,182.01<br />
Equivalent Annualized Return-on-Investment (If assigned on the 4/5/2024 options expiration date): +24.9% <br />
= (+$245.49/$21,182.01) * (365/17 days)</p><p>
<br />
At least eight of the nine metrics used in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet (see below) must be 'YES' prior to establishing a new Covered Calls position using the Covered Calls Advisor's Dividend Capture strategy. As shown below, only seven of the nine criteria are achieved for this Mondelez International Inc. Covered Calls position. </p><p></p><b><b><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgQu7Xd3IN8RAwk5LwC2gf7z3lw7ZzIpeloFnN8NgeGS9pTzOQSBFjQuBawZKLeOr9fL5BSVC2hMrpwUHHkQkNCZ1v3hgMMkBWnaR3Bavb6lf-JgVZLwN83XKgGbUn5z2oKAsKBX2RGwrm4pIxcDBfGFf1b5a_yaNXRPH2YISRf3JD3ehAGo_wDqenRthc/s840/MDLZ%20div%20capt.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="713" data-original-width="840" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgQu7Xd3IN8RAwk5LwC2gf7z3lw7ZzIpeloFnN8NgeGS9pTzOQSBFjQuBawZKLeOr9fL5BSVC2hMrpwUHHkQkNCZ1v3hgMMkBWnaR3Bavb6lf-JgVZLwN83XKgGbUn5z2oKAsKBX2RGwrm4pIxcDBfGFf1b5a_yaNXRPH2YISRf3JD3ehAGo_wDqenRthc/s600/MDLZ%20div%20capt.png" width="600" /></a></div>
<br />
<br /></b></b><p></p><p></p>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-8082216415418066062024-03-18T13:42:00.000-04:002024-03-18T13:42:03.243-04:00Continuation of Covered Calls Position in Match Group Inc.The Covered Calls Advisor Portfolio has a Covered Calls position in Match Group Inc. (ticker MTCH) which expired with the stock at $33.55 which was below the $35.00 strike price at last Friday's options expiration.
Today this position was continued by rolling out to the March 28th, 2024 weekly options expiration at the $34.50 strike price by selling-to-open three Calls at $.81 per share when the
price of Match Group stock had increased to $34.76. <br /><p><b>As detailed below, a potential outcome for this Match Group investment if the stock is in-the-money and therefore assigned on the options expiration date is +2.9% absolute return-on-investment over 29 days (equivalent to +36.6</b><b><b>% annualized-return-on-investment) </b>if the stock closes above the $34.50 strike price on the March 28th, 2024 options expiration date<b>. </b></b>The transactions history of this Match Group Covered Calls position to-date along with a potential return-on-investment result if the stock is assigned on the March 28th, 2024 options expiration date is as follows:</p><div class="separator" style="clear: both;"><br /></div><div><p><b><b>Match Group Inc. (MTCH) </b></b><b>-- Continuation of</b><b> Covered Calls Position</b></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhp8jrHe-vbtLwAKZ5Tsc-jLk0hywNcb_hKnjAAGsfOBuZ2GOx-7CI-aJYibRWRiN6VRZ-MXdVd8cgOFTz_M-6vP-m_8YFtH7vMJ6S5E7L6NxZEFp0_jVkeqMCBWLyGSuL_rfdeLA_BJkEu-Bf-P2AU9ZKw4Z4Fxh1YpWga2npzZGZeTOvjJOKlmt0P/s282/MTCH%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="179" data-original-width="282" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhp8jrHe-vbtLwAKZ5Tsc-jLk0hywNcb_hKnjAAGsfOBuZ2GOx-7CI-aJYibRWRiN6VRZ-MXdVd8cgOFTz_M-6vP-m_8YFtH7vMJ6S5E7L6NxZEFp0_jVkeqMCBWLyGSuL_rfdeLA_BJkEu-Bf-P2AU9ZKw4Z4Fxh1YpWga2npzZGZeTOvjJOKlmt0P/s200/MTCH%20logo.png" width="200" /></a></div>The buy/write transaction was:<br />2/28/2024 Bought 600 Match Group Inc. shares @ $36.49.<br />2/28/2024 Sold 6 MTCH 3/15/2024 $35.00 Call options @ $2.19 per share<b>.</b><br />3/15/2024 Match Group stock price was below the $35.00 strike price, so the Calls expired and the 600 MTCH shares remained in the Covered Calls Advisor Portfolio. <div>3/18/2024 Continued this Match Group Covered Calls position by selling six March 28th, 2024 $34.50 Call options @ $.81 per share when the stock was trading today at $34.76. The Implied Volatility of these Calls was 40.6 and the Delta was 39.3 when this transaction was executed.</div><div><br /></div>A possible overall performance result (including commissions) for this Match Group Covered Calls position if assigned on its 3/28/2024 options expiration date is as follows: <br />Match Group Covered Calls Net Investment: $20,584.02<br />
= ($36.49 - $2.19) * 600 shares + $4.02 commission<br />
<br />
Net Profit:<br />
(a) Options Income: +$1,791.96<br />
= ($2.19 + $.81) * 600 shares - $8.04 commission <br />
(b) Dividend Income: +$0.00 <br />
= ($0.00 dividends per share x 600 shares)<br />(c) Capital Appreciation (If MTCH shares assigned at $34.50 strike price at expiration): -$1,194.00<br />
+($34.50 strike price - $36.49 stock purchase price) * 600 shares<p></p>
<div style="border: medium none;">Total Net Profit (If options exercised on the 3/28/2024 options expiration date): +$597.96</div>
<div style="border: medium none;">
= (+$1,791.96 options income +$0.00 dividend income -$1,194.00 capital appreciation)</div><div style="border: medium none;"><br /></div><div style="border: medium none;">
<div style="border: medium none;">Potential Absolute Return-on-Investment (If the Match Group Inc. shares are assigned at the $34.50 strike price at the March 28th, 2024 options expiration date): +2.9%</div>
<div style="border: medium none;">
= +$597.96/$20,584.02</div>
<div style="border: medium none;">Potential Annualized Return-on-Investment (If 600 Match Group shares assigned at $34.50 at the 3/28/2024 options expiration date): +36.6%</div>
<div style="border: medium none;">
= (+$597.96/$20,584.02) * (365/29 days)</div>
</div>
<br />
<p></p><p></p></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-82808077141070430262024-03-16T11:23:00.002-04:002024-03-16T11:27:28.436-04:00Monthly Options Expiration Results through March 15th, 2024Each month after the monthly options expiration date, this summary report provides the results on all positions that have been closed out during the past month (i.e. since the prior month's options expiration date). So this post covers the period from the day after last month's February 16th, 2024 options expiration through yesterday's March 15th, 2024 monthly options expiration date. <p></p><p>During this past month, the Covered Calls Advisor Portfolio closed a total of twelve positions. Fortunately, all twelve positions were closed out at a profit. In addition, one Covered Calls position expired out-of-the-money on yesterday's monthly options expiration date (so those shares currently remain in the Covered Calls Advisor Portfolio). </p><p>The specific results for each position are summarized as follows: </p><ul><li>Four Covered Calls positions were closed out when their Call options expired in-the-money (stock price above the strike price) on yesterday's March 15th, 2024 monthly options expiration date as follows:</li></ul><ol style="text-align: left;"><li>Yum China Holdings Inc. -- +1.4% absolute return-on-investment in 18 days (equivalent to a +29.4% annualized return-on-investment). </li><li>Becton Dickinson & Company -- +1.0% absolute return-on-investment in 10 days (equivalent to a +38.1% annualized return-on-investment). </li><li>Schlumberger Ltd. -- +2.8% absolute return-on-investment in 46 days (equivalent to a +21.8% annualized return-on-investment).</li><li>Aptiv PLC -- +1.1% absolute return-on-investment in 11 days (equivalent to a +36.4% annualized return-on-investment).</li></ol><div><br /></div><p></p><p></p><p></p><ul style="text-align: left;"><li>Two Covered Calls positions were closed out by early decision as follows:</li></ul><ol style="text-align: left;"><li>Oshkosh Corporation -- +0.1% absolute return-on-investment in 13 days (equivalent to a +0.3% annualized return-on-investment).</li><li>Newmont Corporation -- +1.7% absolute return-on-investment in 12 days (equivalent to a +49.2% annualized return-on-investment).</li></ol><div><br /></div><p></p><ul style="text-align: left;"><li>Three Covered Calls positions were closed out by early assignment when the Call owners decided to exercise their right to close out their options prior to these companies' ex-dividend date. So, the three Covered Calls positions were closed out. The Calls expired and the shares were sold at their respective strike prices with the following results: </li></ul><ol style="text-align: left;"><li>Genuine Parts Company -- +0.9% absolute return-on-investment in 8 days (equivalent to a +40.5% annualized return-on-investment).</li><li>Newmont Corporation -- +0.9% absolute return-on-investment in 5 days (equivalent to a +68.1% annualized return-on-investment).</li><li>FedEx Corporation -- +1.1% absolute return-on-investment in 14 days (equivalent to a +28.8% annualized return-on-investment).</li></ol><div><br /></div><ul style="text-align: left;"></ul><ul style="text-align: left;"></ul><ul style="text-align: left;"><li>Three Covered Calls positions were closed out in-the-money on their weekly options expiration dates during the past month as follows:</li></ul><ol style="text-align: left;"><li>Delta Air Lines Inc. -- +1.2% absolute return-on-investment in 15 days (equivalent to a +29.4% annualized return-on-investment).</li><li>KraneShares CSI China Internet ETF -- +6.4% absolute return-on-investment in 57 days (equivalent to a +41.1% annualized return-on-investment).</li><li>Target Corporation -- +1.6% absolute return-on-investment in 14 days (equivalent to a +40.6% annualized return-on-investment).</li></ol><div><br /></div><ul style="text-align: left;"><li>One Covered Calls position closed out-of-the-money yesterday on its March 15th, 2024 monthly options expiration date, so the Call options expired and the shares now remain in the Covered Calls Advisor Portfolio. Six hundred shares of Match Group Inc. closed at $33.55 per share which was below its $35.00 strike price. Early next week, a decision will be made to either close out the position by selling the shares or to continue the Covered Calls positions by selling future Call options against the shares currently held. As always, the details of all transactions-to-date will be posted on this blog site on the same day the transactions occur.</li></ul><div><br /></div><p></p><p></p><p></p><p></p><p></p><p></p><p></p><p>During the past year
(last 12 months) 119 of 132 positions (90.2%) in the Covered Calls Advisor Portfolio (CCAP) were closed out at a profit. <b>The Covered Calls Advisor Portfolio weighted average annualized-return-on-investment (aroi) was +14.9</b><b>% during the past year and the average holding period for these 132 closed positions was 20.1 days. In comparison, the benchmark S&P 500 has returned +30.2% during the same prior one-year period. </b></p><p></p><p>This Covered Calls Advisor blog is available to anyone interested in learning about implementing a successful Covered Calls investing strategy. As always, I also encourage you to email me at partlow@cox.net any time you would like my feedback on your Covered Call position ideas or your questions on anything related to the Covered Calls investing strategy.</p><p> Best Wishes,</p><p>Jeff Partlow<br />Covered Calls Advisor<br />partlow@cox.net</p><p><br /></p>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-355192746986452342024-03-15T13:29:00.001-04:002024-03-15T13:29:31.318-04:00Established Covered Calls Position in KraneShares CSI China Internet ETFThis afternoon a 3-week Covered Calls position was established in KraneShares CSI China Internet ETF (ticker KWEB). Five hundred shares were purchased at $26.29 and five April 5th, 2024 Call options were sold at the $25.50 strike price at $1.37 per share--a buy/write net debit transaction of $24.92 per share which provides a $.58 per share time value profit potential. The Delta was 65.7 when this transaction occurred. <div><br /></div><div>Wall Street Analysts rate the top 10 positions in KWEB as having +21.5% upside potential from their current prices. From a valuation perspective, KWEB's trailing-twelve-months P/E ratio is only 18.4 which compares very favorably to the market-cap-weighted "magnificent 7" U.S. companies whose P/E is now in the mid 40s. <div div="" nbsp=""><p><b>As detailed below, a potential result is </b><b>+2.3% absolute return-on-investment (equivalent to +40.5% annualized
return-on-investment for the next 21 days) if the KWEB share price is </b><b><b>in-the-money (i.e. above the $25.50 strike price) and therefore assigned on its April 5th, 2024 options expiration date.</b></b></p><p> <br /><b>KraneShares CSI China Internet ETF (KWEB) -- New Covered Calls Position</b> </p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiCYsK_J0bL03oD7j6Ap0UgRHPh2UsnPHGVqA5tJ_65aQhnjyiWrTZbH5QO1PdFQC5UHwdwVIr7i_mG5Y06XgIG2p1W8xH6iJ-eayl_F6mr5NcYqZaf2hOcnKGXgynZM07-_wqsF79gMWj9Ewoc1SKAoMat_ch2HabIsZeYZA8GIu7yrx6Gs75u5RQpTbA/s900/KWEB%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="506" data-original-width="900" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiCYsK_J0bL03oD7j6Ap0UgRHPh2UsnPHGVqA5tJ_65aQhnjyiWrTZbH5QO1PdFQC5UHwdwVIr7i_mG5Y06XgIG2p1W8xH6iJ-eayl_F6mr5NcYqZaf2hOcnKGXgynZM07-_wqsF79gMWj9Ewoc1SKAoMat_ch2HabIsZeYZA8GIu7yrx6Gs75u5RQpTbA/s200/KWEB%20logo.png" width="200" /></a></div>The Buy/Write transaction was as follows:<br />3/15/2024 Bought 500 shares of CSI China Internet ETF @ $26.29 per share. <br />3/15/2024 Sold 5 KWEB April 5th, 2024 $25.50 Call options @ $1.37 per share. The Implied Volatility of the Calls was 35.2 when this position was established. </div><div div="" nbsp=""><br /></div><div div="" nbsp="">A possible overall performance result (including commissions) for this CSI China Internet ETF Covered Calls position is as follows: </div><div div="" nbsp="">KWEB Covered Calls Net Investment: $12,313.35</div><div div="" nbsp="">= ($26.29 - $1.37) * 500 shares + $3.35 commission<p>Net Profit:<br />
(a) Options Income: +$681.65<br />
= ($1.37 * 500 shares) - $3.35 commission <br />(b) Dividend Income: +$0.00<br />
(c) Capital Appreciation (If 500 CSI China Internet ETF shares assigned at $25.50 strike price at expiration): -$395.00 <br />
+($25.50 - $26.29) * 500 shares<br /><br />
Total Net Profit Potential (If 500 CSI China Internet ETF shares assigned at $25.50 strike price at expiration): +$286.65<br />
= (+$681.65 options income +$0.00 dividend income - $395.00 capital appreciation)</p><p>Potential Absolute Return-on-Investment: +2.3%<br />
= +$286.65/$12,313.35<br />Potential Annualized Return-on-Investment: +40.5%<br />
= (+$286.65/$12,313.35) * (365/21 days)</p></div></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-15107286957793607042024-03-14T12:54:00.005-04:002024-03-14T13:00:50.381-04:00Covered Calls Position Established in Aptiv PLCEarly this afternoon, my buy/write limit order for Aptiv PLC (ticker APTV) was executed. My net debit limit price of $72.64 was executed when two hundred shares were purchased at $77.04 and two April 19th, 2024 Call options were sold at $4.40 per share at the $75.00 strike price. The potential time value profit was $2.36 per share = [$75.00 strike price - ($77.04 stock purchase price - $4.40 Call options price)]. A slightly in-the-money Covered Calls position was established with a Delta of 63.8 which approximates a 63.8% probability this position will be in-the-money and therefore assigned on the April 19th, 2024 options expiration date. As desired, the next quarterly earnings report on May 2nd is after the Apr 19th options expiration date.<br /><p></p><p>Aptiv was part of Delphi Automotive until the spin-off of its power systems division in 2017 which became Aptiv PLC (based in Dublin, Ireland). Aptiv is one of the world's largest vehicle component manufacturers and its customers include all 25 of the leading automotive original equipment manufacturers (OEMs), but with no single company representing more than 10% of revenues. Their two divisions are Signal and Power Solutions (74%) and Advanced Safety and User Experience (26%). </p><p>As shown in the detailed chart below, Aptiv meets all 18 filters of my Quality+Value+Growth stock screener and of the 18 companies that met all 18 filters (when my metric weightings were applied), Aptiv was the second highest. Aptiv also met all the filters in both my Future 5-Year PEG Ratios screener and my Stock Rover Overall stock screener. Aptiv is also now top-rated by Morningstar (5 stars).</p><p></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgl-mExdxTfyK8HvHDlxStS8EPVEpHf33NPeaER2FMC7V5hLJz_MAqd3X_Eh5-ZOsqrKwbCZ3i14mGMMWLzUvSXsqkW5YF7O7nXRWKCsr1PbjVxdIHTVURfLGM1R5dfFzhxnfPbwVS68CEmfwxFjpUWeg1bwBoLPafUFr8YYBa126PsiZfrDPooH1svY4A/s470/APTV%20Q+V+G.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="392" data-original-width="470" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgl-mExdxTfyK8HvHDlxStS8EPVEpHf33NPeaER2FMC7V5hLJz_MAqd3X_Eh5-ZOsqrKwbCZ3i14mGMMWLzUvSXsqkW5YF7O7nXRWKCsr1PbjVxdIHTVURfLGM1R5dfFzhxnfPbwVS68CEmfwxFjpUWeg1bwBoLPafUFr8YYBa126PsiZfrDPooH1svY4A/s600/APTV%20Q+V+G.png" width="600" /></a></div><p><b>As detailed below, the potential return-on-investment results for this Aptiv PLC C</b><b>overed Calls position is +3.2</b><b>% absolute return (equivalent to +32.8% annualized
return-on-investment for the next 36 days) </b><b><b>if the stock is assigned on the April 19th, 2024 options expiration date.</b></b></p><div><p></p><p>
</p><p></p><p><br /><b><b><br /></b></b></p><p><b>Aptiv PLC<b> (APTV) </b></b><b>-- </b><b>New Covered Calls Position</b></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhlSNPOprYJq4E3GMCYcAV9olapg5TkOhqQ8RSV2lMeV2LvpWpQHcw0_6DucJ-DhT_CG-DntoNiu-1Gs-Oz0i8AkSfnqIrsHo6G7dLxl7QG6hrX1ioTY1L85Tb8qrlk9jsaqrvOg2a0FHnP1Bj2NEcIWsxMGrpCibnn8WEgSe92mo6RgpzleIaw9Rkbp3Y/s474/APTV%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="106" data-original-width="474" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhlSNPOprYJq4E3GMCYcAV9olapg5TkOhqQ8RSV2lMeV2LvpWpQHcw0_6DucJ-DhT_CG-DntoNiu-1Gs-Oz0i8AkSfnqIrsHo6G7dLxl7QG6hrX1ioTY1L85Tb8qrlk9jsaqrvOg2a0FHnP1Bj2NEcIWsxMGrpCibnn8WEgSe92mo6RgpzleIaw9Rkbp3Y/s200/APTV%20logo.png" width="200" /></a></div>The buy/write transaction was:<br />3/14/2024 Bought 200 Aptiv PLC shares @ $77.04<br />3/14/2024 Sold 2 APTV 4/19/2024 $75.00 Call options @ $4.40 per share<b>. </b>The Implied Volatility of these Calls was 31.0 when this position was estalished.<br /><br />A possible overall performance result (including commissions) for this Aptiv Covered Calls position is as follows: <br />Aptiv Covered Calls Net Investment: $14,529.34<br />
= ($77.04 - $4.40) * 200 shares + $1.34 commission<br />
<br />
Net Profit:<br />
(a) Options Income: +$878.66<br />
= ($4.40 * 200 shares) - $1.34 commission <br />
(b) Dividend Income: +$0.00 <br />
= ($0.00 dividends per share x 200 shares)<br />(c) Capital Appreciation (If APTV shares assigned at $75.00 strike price at expiration): -$408.00<br />
+($75.00 - $77.04) * 200 shares<p></p>
<div style="border: medium none;">Total Net Profit (If options exercised on the 4/19/2024 options expiration date): +$470.66</div>
<div style="border: medium none;">
= (+$878.66 options income +$0.00 dividend income -$408.00 capital appreciation)</div><div style="border: medium none;"><br /></div><div style="border: medium none;">
<div style="border: medium none;">Potential Absolute Return-on-Investment (If the Aptiv shares are assigned at the $75.00 strike price at the April 19th, 2024 options expiration date): +3.2%</div>
<div style="border: medium none;">
= +$470.66/$14,529.34</div>
<div style="border: medium none;">Potential Annualized Return-on-Investment (If 200 Aptiv PLC shares assigned at $75.00 at the 4/19/2024 options expiration): +32.8%</div>
<div style="border: medium none;">
= (+$470.66/$14,529.34) * (365/36 days)</div>
</div>
<br /><br />
<p></p><p></p></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-39606850732664850602024-03-13T16:11:00.008-04:002024-03-13T16:22:08.141-04:00Covered Calls Position Established in Halozyme Therapeutics Inc.Today a Covered Calls position was established in Halozyme Therapeutics Inc. (ticker HALO) when four hundred shares were purchased at $41.54 and four April 19th, 2024 Call options were sold at $2.86 per share at the $40.00 strike price. So, the corresponding potential time value (aka extrinsic value) profit potential is $1.32 per share = [$2.86 Call options premium - ($41.54 stock purchase price - $40.00 strike price)]. An in-the-money Covered Calls position was established with the Delta of the Calls at 65.8 when this buy/write limit order transaction was executed, which approximates the probability of assignment on the April 19th, 2024 options expiration date. Halozyme does not pay a dividend and importantly, their next quarterly earnings report on May 7th, 2024 is after the April 19th, 2024 options expiration date.<div><br /></div><div>A comparison between whether a Covered Calls or a Cash-Secured Puts position would be preferable was made shortly before I entered this order. The decision was an easy one since the time value for the Covered Calls of $1.32 was substantially better than the $1.10 (midpoint of the $1.00/$1/20 bid/ask price) for the comparable Puts.<br /><div><br /></div><div>Halozyme Therapeutics is a small-cap biotechnology company that has a range of auto-injector devices for subcutaneous and intramuscular delivery to patients. They have license agreements in partnership with several drug companies with 7 currently approved products and 10 expected by 2025. When co-formulated with drugs, their products have the potential to reduce the treatment burden for patients (minutes for subcutaneous injections versus hours for IV infusions). Also, I am very impressed by the leadership qualities of their CEO Helen Torley.</div><div>If interested in additional information on Halozyme, their most recent corporate slides presented in conjunction with their Q4 2023 conference call on 2/20/2024 are <a href="https://s28.q4cdn.com/284259014/files/doc_presentation/2024/HALO-Corporate-Deck-February-2024-FINAL.pdf">here</a>.</div><div> </div><div>As shown below, Halozyme also meets all twelve filters in my Stock Rover Overall stock screener. <div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhpDn4Epv4DmmgpiXprwfFtRt8xd5E1VCs2dlntLnueDpJ6LCzCowEOVsf-oddSsaOxw_8_9ugrWFjXq31euahVmo4Mtf93dcxvj0HS0OsfsNXTWS8DNN38HTI9NmQ90iaYTF7P-gXLA3r1n1tm8OjtDi2ySI-WmeIxw9ieNwEB_8IKfsHcsR6ikfRTLSk/s477/HALO%20Stock%20Rover%20Overall.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="331" data-original-width="477" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhpDn4Epv4DmmgpiXprwfFtRt8xd5E1VCs2dlntLnueDpJ6LCzCowEOVsf-oddSsaOxw_8_9ugrWFjXq31euahVmo4Mtf93dcxvj0HS0OsfsNXTWS8DNN38HTI9NmQ90iaYTF7P-gXLA3r1n1tm8OjtDi2ySI-WmeIxw9ieNwEB_8IKfsHcsR6ikfRTLSk/s600/HALO%20Stock%20Rover%20Overall.png" width="600" /></a></div></div><div><br /></div><br /><div><b>Halozyme Therapeutics Inc. (HALO) -- New Covered Calls Position</b></div><div><div><div>The net debit buy/write limit order was executed as follows:<div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhn8LYwtfNDDThTirD0gz6sWH2odT8RKQqCBuwdVFtwG2y6Vx8TaC0HUYIj0faxMlbuCfhKV_Oyfsonr38ZWbFeMKLdkM5z1qtgmi4hrwuJE3LuzmGXO71XH9IGwIorc4MAenCI8PAgGJ1PTSsby7gvq79iTP1HdHdf3ODQk2MhdsjGQQloA8AU4sOuXTs/s311/HALO%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="162" data-original-width="311" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhn8LYwtfNDDThTirD0gz6sWH2odT8RKQqCBuwdVFtwG2y6Vx8TaC0HUYIj0faxMlbuCfhKV_Oyfsonr38ZWbFeMKLdkM5z1qtgmi4hrwuJE3LuzmGXO71XH9IGwIorc4MAenCI8PAgGJ1PTSsby7gvq79iTP1HdHdf3ODQk2MhdsjGQQloA8AU4sOuXTs/s200/HALO%20logo.png" width="200" /></a></div>3/13/2024 Bought 400 shares of Halozyme Therapeutics stock @ $41.54 per share. <br />3/13/2024 Sold 4 HALO April 19th, 2024 $40.00 Call options @ $2.86 per share. Note: the Implied Volatility of the Calls was 35.2 when this position was established. <br />
<br />A possible overall performance results (including commissions) for this position if the position is in-the-money on the options expiration date is as follows: <br />
Halozyme Covered Calls Net Investment: $15,474.68<br />= ($41.54 - $2.86) * 400 shares + $2.68 commission</div><p>Net Profit Components: <br />
(a) Options Income: +$1,141.32<br />
= ($2.86 * 400 shares) - $2.68 commission <br />
(b) Dividend Income: +$0.00<br />(c) Capital Appreciation (If Halozyme stock is above the $40.00 strike price at the April 19th options expiration date): -$616.00<br />= ($40.00 strike price - $41.54 stock purchase price) * 400 shares</p><p>Potential Total Net Profit (If in-the-money and therefore assigned at expiration): +$525.32<br />= (+$1,141.32 options income + $0.00 dividend income - $616.00 capital appreciation)</p><p><b>Potential Absolute Return-on-Investment (If stock price is in-the-money and therefore assigned on the 4/19/2024 options expiration date): +3.4% </b>= +$525.32/$15,474.68</p><p><b>Potential Equivalent Annualized-Return-on-Investment: +33.5%</b><br />= (+$525.32/$15,474.68) * (365/37 days)</p><p><br /></p></div><div>
<p></p><p></p></div></div></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-17225954838901412192024-03-11T13:29:00.002-04:002024-03-11T13:29:51.388-04:00Closed Out Covered Calls in Newmont CorporationI established a Covered Calls position in Newmont Corporation (ticker NEM) on February 28, 2024 by a simultaneous buy/write purchase of 600 Newmont shares at $29.65 and sold-to-open 6 March 15th, 2024 $28.50 Call options at $1.42 per share. 400 share were called away by early assignment on the last business day prior to the 3/4/2024 ex-dividend date. The ex-div amount was $.25 per share and since the stock price had increased from its $29.65 purchase price to $31.94 at market close on the day prior to the ex-dividend date and the time value remaining in the Calls was $0.00, a Call owner decided to exercise their option to buy 400 shares at the $28.50 strike price and also capture the March 4th ex-dividend. I was pleased with this early assignment since an annualized-return-on-investment for the 400 Newmont shares sold was +68.1%. A description of this close out transaction was posted on my blog <a href="https://coveredcallsadvisor.blogspot.com/2024/03/early-assignment-situations-in-yum.html">here</a>.<div><br /></div><div>Two hundred shares of my original Newmont Covered Calls position were not exercised early, so this Covered Calls position continued in my Covered Calls Advisor Portfolio -- that is until this afternoon. This Covered Calls position had an expiration date of this Friday, March 15th. But the stock price has continued to increase to $34.96 today, so I decided to unwind (i.e. close out) the remaining 200 shares of this Newmont Covered Calls position at a net credit of $28.45, which had only $.05 of time value remaining in this position and with 4 days remaining until the options expiration date. The annualized return-on-investment achieved for the 200 shares of this Newmont Corp. Covered Calls position was +49.2% for the 12 days duration of this investment. I decided to close out this position today since the +49.2% result was better than the +41.5% maximum potential annualized-return-on-investment if this Covered Calls position was instead assigned this Friday on its March 15th options expiration date. </div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-57610584889067481352024-03-11T10:25:00.000-04:002024-03-11T10:25:35.787-04:00Established Covered Calls in Novo-Nordisk GlobalToday, a Covered Calls position was established in Novo-Nordisk Global (ticker NVO) with the purchase of 200 shares at $132.34 per share and two March 28th, 2024 quarterly Call options were sold for $6.32 per share at the $128.00 strike price. So, the corresponding potential time value (aka extrinsic value) profit is $1.98 per share = [$6.32 Call options premium - ($132.34 stock purchase price - $128.00 strike price)]. A moderately in-the-money Covered Calls positions was established with the Delta of the Calls at 70.6 when this buy/write transaction was executed, which approximates the probability of assignment on the March 28th, 2024 options expiration date. Novo-Nordisk's has an upcoming semi-annual ex-dividend at $.9299 per share (2.8% dividend yield at the current stock price) on March 22nd is prior to the March 28th options expiration date, so this dividend is included in the potential return-on-investment results shown below. As shown on the chart at the bottom of this post, eight of the nine criteria in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet were met for this position. As I also prefer, the next quarterly earnings report on May 2nd, 2024 is after the options expiration date.
<p>Novo-Nordisk is a pharmaceutical company based in Denmark. Its key divisions include Diabetes Care,
Obesity Care, and Rare Diseases. Key products include Ozempic, Victoza, and insulin for diabetes; Wegovy
and Saxenda for obesity; and treatments for rare blood and endocrine disorders.</p><p><b>Two potential return-on-investment results are: (a) +1.6% absolute return-on-investment (equivalent to +52.0% annualized
return-on-investment for the next 11 days) if the stock is assigned early (on the last trading day prior to the March 22nd, 2022 ex-dividend date); OR (b) +2.3%
absolute return-on-investment (equivalent to +49.5% annualized return-on-investment over the next 17 days) if the stock is assigned on the March 28th, 2024 options expiration date. </b></p><p></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEipGlmfUEgAb26iTU0iwGMkpk3DBxg2V5qSPGDNfuvfXhp6hXj3X9EBjY4ASLp6WkUm4Lr6v1vmmGPfg43RaqAqNLw_sCoXS7TGRIJ3c_Dioxba9y1yRDw9HThOCcIwJA0T0vS2v2kPQZS0387KyhqWWV_ToaT5pn0DIZyZ14AAaAT5Np7YgVUoTXRiyMI/s262/NVO%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="192" data-original-width="262" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEipGlmfUEgAb26iTU0iwGMkpk3DBxg2V5qSPGDNfuvfXhp6hXj3X9EBjY4ASLp6WkUm4Lr6v1vmmGPfg43RaqAqNLw_sCoXS7TGRIJ3c_Dioxba9y1yRDw9HThOCcIwJA0T0vS2v2kPQZS0387KyhqWWV_ToaT5pn0DIZyZ14AAaAT5Np7YgVUoTXRiyMI/s200/NVO%20logo.png" width="200" /></a></div><p style="font-weight: bold;"><b><b><b><b><b><b><b><b><b><b><br /></b></b></b></b></b></b></b></b></b></b></p><b>Novo-Nordisk Global (NVO) -- New Covered Calls Position</b><br />
The simultaneous buy/write transaction was as follows:<br />3/11/2024 Bought 200 shares of Novo-Nordisk stock @ $132.34 per share. <br />3/11/2024 Sold 2 NVO March 28th, 2024 $128.00 Call options @ $6.32 per share.<br />3/22/2024 Upcoming ex-dividend of $.9299 per share <br />
<br />
Two possible overall performance results (including commissions) would be as follows: <br />
Covered Calls Net Investment: $25,205.34<br />= ($132.34 - $6.32) * 200 shares + $1.34 commission<p></p><p></p>
Net Profit Components: <br />
(a) Options Income: +$1,262.66<br />
= ($6.32 * 200 shares) - $1.34 commission<br />
(b) Dividend Income (If Novo-Nordisk shares assigned on 3/21/2024, the business day prior to the 3/22/2024 ex-dividend date): = +$0.00; or<br />
(b) Dividend Income (If NVO shares assigned at the 3/28/2024 options expiration date): +$185.98<br />
= $.9299 per share x 200 shares <br />
(c) Capital Appreciation (If Novo-Nordisk shares assigned early on 3/22/2024): -$868.00 <br />
= ($128.00 strike price -$132.34 stock purchase price) * 200 shares; or<br />
(c) Capital Appreciation (If NVO shares assigned with stock above the $128.00 strike price at the March 28th options expiration): -$868.00 <br />
= ($128.00 -$132.34) * 200 shares<br />
<br />
1. Potential Net Profit (If Novo-Nordisk shares assigned on 3/21/2024, the day prior to the March 22nd ex-dividend date): +$394.66<br />
= (+$1,262.66 options income +$0.00 dividend income - $868.00 capital appreciation)<br />
2. Potential Net Profit (If NVO price is above $128.00 strike price at the March 28th options expiration): +$580.64<br />
= (+$1,262.66 options income +$185.98 dividend income - $868.00 capital appreciation)<br />
<br />
1. Absolute Return-on-Investment (If Novo-Nordisk shares assigned early on 3/21/2024, the day prior to the March 22nd, 2024 ex-dividend date): +1.6%<br />
= +$394.66/$25,205.34<br />
Equivalent Annualized Return-on-Investment (If assigned early on day prior to ex-div date): +52.0% <br />
= (+$394.66/$25,205.34) * (365/11 days)<p></p><p>
2. Absolute Return-on-Investment (If Novo-Nordisk price is above $128.00 strike price at the March 28th options expiration date): +2.3%<br />
= +$580.64/$25,205.34<br />
Equivalent Annualized Return-on-Investment (If assigned on 3/28/2024 options expiration date): +49.5% <br />
= (+$580.64/$25,205.34) * (365/17 days)</p><p>
<br />
At least eight of the nine metrics used in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet (see below) must be 'YES' prior to establishing a new Covered Calls position using the Covered Calls Advisor's Dividend Capture strategy. As shown below, eight of the nine criteria are achieved for this Novo-Nordisk Global Covered Calls position.</p><p></p><b><b><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh2Vo3kQmMHYU1EDTSaG4n55MsT7i3Ut1dZlhhJ2iVQeiVkswFMEhoCFq-ReRrdsVYF1KNH2eTg3RkARbLQHQ1n13Eg5rCm4yBo2_Aa3OVSS2D1bX597bJh5NilSlJuUiPfChvsGtspysxOicUxOJ6oNnHhHdag6y5f0sG5b6mlhFpF9img1vjufm0WI6k/s840/NVO%20div%20capt.png" style="display: block; padding: 1em 0; text-align: center; "><img alt="" border="0" width="600" data-original-height="713" data-original-width="840" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh2Vo3kQmMHYU1EDTSaG4n55MsT7i3Ut1dZlhhJ2iVQeiVkswFMEhoCFq-ReRrdsVYF1KNH2eTg3RkARbLQHQ1n13Eg5rCm4yBo2_Aa3OVSS2D1bX597bJh5NilSlJuUiPfChvsGtspysxOicUxOJ6oNnHhHdag6y5f0sG5b6mlhFpF9img1vjufm0WI6k/s600/NVO%20div%20capt.png"/></a></div>
<br />
<br /></b></b><p></p><p></p>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-13053510119605053322024-03-08T08:51:00.000-05:002024-03-08T08:51:14.428-05:00Early Assignment of Covered Call Position in FedEx CorporationThis morning I was notified that the FedEx Corporation (ticker FDX) March 15th, 2024 $237.50 Call option was exercised yesterday. Because the FedEx stock price increased from $243.00 when this position was established to $249.93 at yesterday's market close, the original $2.60 time value in the Calls when the position was established had declined on yesterday's market close to $0.00, so the owner of this FedEx Call exercised their option to buy the 100 shares at the $237.50 strike price in order for them to receive today's $1.26 per share ex-dividend. <b><b><b><br /></b></b></b><p>The post when this FedEx Covered Call position was originally established is <a href="https://coveredcallsadvisor.blogspot.com/2024/02/covered-call-established-in-fedex.html">here</a>.<b> As detailed below, t<b>he return-on-investment result </b><b>was </b></b><b><b><b><b><b><b>+1.1</b><b><b>%</b><b><b> absolute
return in 14 days (equivalent to a +28.8% annualized
return-on-investment)</b></b></b></b>.</b></b></b></b></p>
<br /><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/a/AVvXsEih2Kc86q2hiXKDMF3YxyT5FduSKTiPuBqYLWmfBZhFdpr_468TGLFO_Fg4TsLNhXe7iACjTIRrEAFjtNloFb0A0m1z2mqTvXahQWH783uYJbb6OlnSsnTdsEJI1N-kBfE6y2puKfDKZlecX3_hT1kXhnZbfWZnM5hkj4Kbn_1lPvsS8TeWBN655cnF=s281" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><br /><img alt="" border="0" data-original-height="179" data-original-width="281" src="https://blogger.googleusercontent.com/img/a/AVvXsEih2Kc86q2hiXKDMF3YxyT5FduSKTiPuBqYLWmfBZhFdpr_468TGLFO_Fg4TsLNhXe7iACjTIRrEAFjtNloFb0A0m1z2mqTvXahQWH783uYJbb6OlnSsnTdsEJI1N-kBfE6y2puKfDKZlecX3_hT1kXhnZbfWZnM5hkj4Kbn_1lPvsS8TeWBN655cnF=s200" width="200" /></a></div>
<b>FedEx Corporation </b><b style="font-weight: bold;">(FDX) -- </b><b style="font-weight: bold;">Covered Call Position Closed Out by Early Assignment</b><br />The buy/write transaction was:<br />2/23/2024 Bought 100 FedEx shares @ $243.00.<br />2/23/2024 Sold 1 FedEx 3/15/2024 $237.50 Call option @ $8.10 per share.<br />3/8/2024 FedEx Call option owner exercised their one Call option, so the Covered Call position was closed out early. The one FDX Call option expired worthless and the 100 FedEx Corporation shares were sold at the $237.50 strike price.<br />
<br />
The overall performance results (including commissions) for this FedEx Corporation Covered Call position are as follows: <br />Covered Call Net Investment: $23,490.67<br />= ($243.00 - $8.10) * 100 shares + $.67 commission<br /><br />Net Profit Components:<br />(a) Option Income: +$809.33<br />= ($8.10 * 100 shares) - $.67 commission<br />(b) Dividend Income (Call option exercised early on the business day prior to the ex-div date): +$0.00<br />(c) Capital Appreciation (FedEx shares assigned early): -$550.00<br />+($237.50 strike price -$243.00 stock purchase cost) * 100 shares<p></p><div style="border: medium none;">Total Net Profit: +$259.33</div><div style="border: medium none;">= (+$809.33 option income +$0.00 dividend income -$550.00 capital appreciation)</div><div style="border: medium none;"><br /><div style="border: medium none;">Absolute Return-on-Investment: +1.1%</div><div style="border: medium none;">= +$259.33/$23,490.67</div><div style="border: medium none;">Annualized Return-on-Investment: +28.8%</div><div style="border: medium none;">= (+$259.33/$23,490.67) * (365/14 days)</div><div style="border: medium none;"><br /></div></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-37091380764162451702024-03-07T15:29:00.007-05:002024-03-07T15:46:12.664-05:00Established Covered Calls in Merck & Co. Inc.Today, a Covered Calls position was established in Merck & Co. Inc. (ticker MRK) with the purchase of 200 shares at $123.76 per share and two March 22nd, 2024 Call options were sold for $3.52 per share at the $121.00 strike price. A moderately in-the-money Covered Calls positions was established with the Delta of the Calls at 75.2 when this buy/write transaction was executed, which approximates the probability of assignment on the March 22nd, 2024 options expiration date. Merck goes ex-dividend at $.77 per share (2.5% dividend yield at the current stock price) on March 14th which is prior to the March 22nd options expiration date, so this dividend is included in the potential return-on-investment results shown below. All nine criteria in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet were met for this position and there is no quarterly earnings report prior to the options expiration date.
<p><b>Two potential return-on-investment results are: (a) +0.6% absolute return-on-investment (equivalent to +33.0% annualized
return-on-investment for the next 7 days) if the stock is assigned early (on the last trading day prior to the March 14th, 2022 ex-dividend date); OR (b) +1.3%
absolute return (equivalent to +31.0% annualized return over the next 15 days) if the stock is assigned on the March 22nd options expiration date. </b><br />
</p><p></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgKQcdnVNV8lfp5pysohbx1-9yRGKPBwzPd0MTsQurkWghe_XOe_oU7ZAdZjI8iKsqspwm52N5iPBhtx3eiRu-vn5Ku1Ys-B6Qg5T96lIaBYRnzyCUAioWtsOt6U9sERsngZl61Zgxwoe4tcI0vfkP2_S6Drotjzg_Y4Dr2hD-BCQJqDYrjgJKCy8olpN8/s411/MRK%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="122" data-original-width="411" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgKQcdnVNV8lfp5pysohbx1-9yRGKPBwzPd0MTsQurkWghe_XOe_oU7ZAdZjI8iKsqspwm52N5iPBhtx3eiRu-vn5Ku1Ys-B6Qg5T96lIaBYRnzyCUAioWtsOt6U9sERsngZl61Zgxwoe4tcI0vfkP2_S6Drotjzg_Y4Dr2hD-BCQJqDYrjgJKCy8olpN8/s200/MRK%20logo.png" width="200" /></a></div><b><b><b><b><b><b><b><b><b><b><p><b><b><b><b><b><b><b><b><b><b><br /></b></b></b></b></b></b></b></b></b></b></p>Merck & Co. Inc. </b></b>(MRK) -- New Covered Calls Position</b></b></b></b><br /></b></b></b></b>
The simultaneous buy/write transaction was as follows:<br />3/7/2024 Bought 200 shares of Merck & Co. stock @ $123.76 per share. <br />3/7/2024 Sold 2 MRK March 22nd, 2024 $121.00 Call options @ $3.52 per share.<br />3/14/2024 Upcoming ex-dividend of $.77 per share <br />
<br />
Two possible overall performance results (including commissions) would be as follows: <br />
Covered Calls Net Investment: $24,049.34<br />= ($123.76 - $3.52) * 200 shares + $1.34 commission<p></p><p></p>
Net Profit Components: <br />
(a) Options Income: +$704.00 <br />
= ($3.52 * 200 shares)<br />
(b) Dividend Income (If Merck shares assigned on 3/13/2024, the business day prior to the 3/14/2024 ex-dividend date): = +$0.00; or<br />
(b) Dividend Income (If Merck shares assigned at 3/22/2024 options expiration): +$154.00<br />
= $.77 per share x 200 shares <br />
(c) Capital Appreciation (If MRK shares assigned early on 3/13/2024): -$552.00 <br />
= ($121.00 strike price -$123.76 stock purchase price) * 200 shares; or<br />
(c) Capital Appreciation (If MRK shares assigned with stock above the $121.00 strike price at the March 22nd options expiration): -$552.00 <br />
= ($121.00 -$123.76) * 200 shares<br />
<br />
1. Potential Net Profit (If Merck shares assigned on 3/13/2024, the day prior to the March 14th ex-dividend date): +$152.00<br />
= (+$704.00 options income +$0.00 dividend income - $552.00 capital appreciation)<br />
2. Potential Net Profit (If MRK price is above $121.00 strike price at the March 22nd options expiration): +$306.00<br />
= (+$704.00 options income +$154.00 dividend income - $552.00 capital appreciation)<br />
<br />
1. Absolute Return-on-Investment (If Merck shares assigned early on 3/13/2024, the day prior to the March 14th, 2024 ex-dividend date): +0.6%<br />
= +$152.00/$24,049.34<br />
Equivalent Annualized Return-on-Investment (If assigned early on day prior to ex-div date): +33.0% <br />
= (+$152.00/$24,049.34) * (365/7 days)<p></p><p>
2. Absolute Return-on-Investment (If Merck price is above $121.00 strike price at the March 22nd options expiration): +1.3%<br />
= +$306.00/$24,049.34<br />
Equivalent Annualized Return-on-Investment (If assigned on 3/22/2024 options expiration date): +31.0% <br />
= (+$306.00/$24,049.34) * (365/15 days)</p><p>
<br />
At least eight of the nine metrics used in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet (see below) must be 'YES' prior to establishing a new Covered Calls position using the Covered Calls Advisor's Dividend Capture strategy. As shown below, all nine criteria are achieved for this Merck & Co. Inc. Covered Calls position.</p><p></p><b><b><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiOK5y8dwYmMweq7Bv9XRNUA8WoCfj81oC8Gpy5RXe8yX_sVkvEbgiVgDSLHuXk_8emSv31U_i5N0aToIq2uTV6jm6KSQWm2Tif0_3LV6ltR8AfCZG4YO3X_JPDkONAKyBdHQ39IFl8Diivv07u7Pkfujwb-j3a4ch7TMoSvNrJqpnSDbjrODwrvYL4QG0/s840/MRK%20div%20capt.png" style="display: block; padding: 1em 0; text-align: center; "><img alt="" border="0" width="600" data-original-height="713" data-original-width="840" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiOK5y8dwYmMweq7Bv9XRNUA8WoCfj81oC8Gpy5RXe8yX_sVkvEbgiVgDSLHuXk_8emSv31U_i5N0aToIq2uTV6jm6KSQWm2Tif0_3LV6ltR8AfCZG4YO3X_JPDkONAKyBdHQ39IFl8Diivv07u7Pkfujwb-j3a4ch7TMoSvNrJqpnSDbjrODwrvYL4QG0/s600/MRK%20div%20capt.png"/></a></div>
<br />
<br /></b></b><p></p><p></p>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-42895734313407054772024-03-05T15:33:00.000-05:002024-03-05T15:33:51.990-05:00Covered Call Position Established in Becton Dickinson & CompanyA short-term Covered Call net debit limit order was executed and 100 shares of Becton Dickinson & Company (ticker symbol BDX) stock were purchased at $233.29 and 1 March 15th, 2024 $230.00 Call option was sold at $4.73 per share -- a net debit of $228.56 per share. So, the corresponding potential time value (aka extrinsic value) profit was $1.44 per share = [$4.723 Call options premium - ($233.29 stock purchase price - $230.00 strike price)]. The Delta was 67.7 which closely approximates a probability of assignment on the options expiration date of 67.7%. Given the Covered Calls Advisor's current Neutral Overall Market Meter outlook, a slightly in-the-money Covered Calls position was established. <div><br /></div><div>There is an upcoming ex-dividend on Thursday of $.95 per share (a 1.6% annual dividend yield). This dividend is included in the potential return-on-investment results detailed below. Also, as preferred, there is no earnings report prior to the options expiration date<span face="Arial, Helvetica, sans-serif" style="background-color: white; font-size: 16px; letter-spacing: 0.15px;">.</span></div><div><span style="letter-spacing: 0.15px;"><br /></span><div><b><b>As detailed below, a potential outcome for this</b> Becton Dickinson & Company<b> </b><b>investment is +1.0% absolute return-on-investment for the next 10 days (equivalent to +38.1</b></b><b><b>% annualized-return-on-investment) </b>if the stock closes above the $230.00 strike price on the March 15th, 2024 options expiration date<b>.</b></b></div><div><b><br /></b><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEicIB9iFMG0gOddkjq8Ey2wfu5_4KRyyR8mgJZvRHqjLw0xz-FP2j0g1vMKofSCH2Ffk8__gEi0TiXZXiyXiniW2Ik_tFi9ZyPIknqj5w5tbOG02XRBmmMHNxZaXxlnaTsf0wU5pDAFJ7ofP727OvE7dRX3XZM2cIzcQ2DcGC8RyI_NNT9ghwfqx7MLStY/s273/BDX%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="184" data-original-width="273" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEicIB9iFMG0gOddkjq8Ey2wfu5_4KRyyR8mgJZvRHqjLw0xz-FP2j0g1vMKofSCH2Ffk8__gEi0TiXZXiyXiniW2Ik_tFi9ZyPIknqj5w5tbOG02XRBmmMHNxZaXxlnaTsf0wU5pDAFJ7ofP727OvE7dRX3XZM2cIzcQ2DcGC8RyI_NNT9ghwfqx7MLStY/s200/BDX%20logo.png" width="200" /></a></div><b>Becton Dickinson & Company (BDX) -- New </b><b>Covered </b><b>Call Position</b></div><div>The net debit buy/write limit order was executed as follows:</div><div><div>3/5/2024 Bought 100 shares of Becton Dickinson stock @ $233.29 per share. <br />3/5/2024 Sold 1 BDX March 15th, 2024 $230.00 Call option @ $4.73 per share.<br />3/7/2024 Ex-dividend of $.95 per share.</div><div><br />
A possible overall performance result (including commissions) if this position is assigned on its 3/15/2024 option expiration date is as follows: <br />
Covered Calls Net Investment: $22,856.67<br />= ($233.29 - $4.73) * 100 shares + $.67 commission</div><p>Net Profit Components: <br />
(a) Call Option Income: +$472.33<br />
= ($4.73 * 100 shares) - $.67 commission <br />
(b) Dividend Income: +$95.00<br />= $.95 x 100 shares<br />
(c) Capital Appreciation (If Becton Dickinson stock is above the $230.00 strike price at the 3/15/2024 option expiration date): -$329.00 <br />
= ($230.00 - $233.29) * 100 shares <br /><br />
Potential Total Net Profit (If assigned at expiration): +$238.33<br />
= (+$472.33 option income + $95.00 dividend income - $329.00 capital appreciation)<br /><br />
Potential Absolute Return-on-Investment: +1.0%<br />
= +$238.33/$22,856.67<br />Potential Equivalent Annualized-Return-on-Investment: +38.1% <br />
= (+$238.33/$22,856.67) * (365/10 days)</p><p></p></div></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-58095720842857087632024-03-05T12:02:00.001-05:002024-03-05T12:02:16.526-05:00Covered Call Position Established in Microsoft CorporationToday a Covered Call position was establised in Microsoft Corporation (ticker MSFT). My buy/write net debit limit order was executed and 100 Microsoft shares were purchased at $403.23 and 1 March 22nd, 2024 $395.00 Call option was sold at $13.31 per share -- a net debit of $389.92 per share. So, the potential time value profit if the stock is in-the-money and therefore closed out by assignment at expiration is $5.08 per share [$13.31 Call option premium - ($403.23 stock purchase price - $395.00 strike price)]. The Delta was 65.9 which closely approximates the probability of assignment on the options expiration date of 65.9%. This position avoids the next quarterly earnings report on April 30th which is more than a month after the March 22nd options expiration date. <div><br /></div><div><div><b><b>As detailed below, a potential outcome for this Microsoft Corporation investment is +1.3% absolute return-on-investment for the next 17 days (equivalent to +27.9</b></b><b><b>% annualized-return-on-investment) </b>if the stock closes above the $395.00 strike price on the March 22nd, 2024 options expiration date<b>.</b></b></div><div><b><b><br /></b></b></div><div><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjcIhqewXgab4ELDajTwYqeifrOwjDJ8EvU8EUyocBNBI6LJz9jaqnLjUBERnXcUhGNIObkBmNkAN6YSkwxuSkICDGfs31p2bIc2cnSyjwlT1ql5HEyiotVJU8GCutn4knMiLXZz3QZtMx0xYtG8pgJJiu55PHJ-nU9yDlF06ZEfL170He3NymetkkAT5o/s275/MSFT%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="183" data-original-width="275" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjcIhqewXgab4ELDajTwYqeifrOwjDJ8EvU8EUyocBNBI6LJz9jaqnLjUBERnXcUhGNIObkBmNkAN6YSkwxuSkICDGfs31p2bIc2cnSyjwlT1ql5HEyiotVJU8GCutn4knMiLXZz3QZtMx0xYtG8pgJJiu55PHJ-nU9yDlF06ZEfL170He3NymetkkAT5o/s200/MSFT%20logo.png" width="200" /></a></div><b><b><b><b>Microsoft Corporation (MSFT) -- New Covered Call Position</b></b></b></b><div>The net debit buy/write limit order was executed as follows:<br />3/5/2024 Bought 100 shares of Microsoft stock @ $403.23 per share. <br />3/5/2024 Sold 1 MSFT March 22nd, 2024 $395.00 Call option @ $13.31 per share.<br /><br />
A possible overall performance result (including commissions) if this position is assigned on its 3/22/2024 option expiration date is as follows: <br />Microsoft Covered Call Net Investment: $38,992.67<br />= ($403.23 - $13.31) * 100 shares + $.67 commission</div><p>Net Profit Components: <br />
(a) Call Option Income: +$1,330.33<br />
= ($13.31 * 100 shares) - $.67 commission <br />
(b) Dividend Income: +$0.00<br />
(c) Capital Appreciation (If Microsoft stock is above the $395.00 strike price at the March 22nd option expiration date): -$823.00 <br />
= ($395.00 - $403.23) * 100 shares <br /><br />
Potential Total Net Profit (If assigned at expiration): +$507.33<br />
= (+$1,330.33 option income + $0.00 dividend income - $823.00 capital appreciation)<br /><br />
Potential Absolute Return-on-Investment: +1.3%<br />
= +$507.33/$38,992.67<br />Potential Equivalent Annualized-Return-on-Investment: +27.9% <br />
= (+$507.33/$38,992.67) * (365/17 days)</p><p></p></div></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-91764651648871131852024-03-04T15:53:00.005-05:002024-03-04T15:53:56.776-05:00Continuation of Covered Calls Position in Schlumberger LtdThe Covered Calls Advisor Portfolio has a Covered Calls position in Schlumberger Ltd. (now SLB) which expired out-of-the-money at last Friday's options expiration.
Today this position was continued by rolling out to the March 15th, 2024 weekly options expiration at the $50.00 strike price by selling-to-open three Calls at $.91 per share when the
price of SLB stock was $49.56. <br /><p><b>As detailed below, a potential outcome for this SLB investment if the stock is in-the-money and therefore assigned on the options expiration date is +2.8% absolute return-on-investment over 46 days (equivalent to +21.8</b><b><b>% annualized-return-on-investment) </b>if the stock closes above the $50.00 strike price on the March 15th, 2024 options expiration date<b>. </b></b>The transactions history of this SLB Covered Calls position so far along with a potential return-on-investment result if the stock is assigned on the March 15th, 2024 options expiration date is as follows:</p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiRN7rZo8NnHrdebjrCP2URlJvOMTSUS_2KNeYHwxFrwqhn6HDFs8Phzch11epDHEK_PewASZhlakIy6kRzM3kqzzD2Dudtu8CSMKYbXOX1-E-mwLXQwgUtXLdgR4JRCn9ceuLad0uWUswTIeO4cLqauqTpOf36bYVNNKFGluafaoFzM-cpz2LdFVUYhU0/s275/SLB%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="183" data-original-width="275" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiRN7rZo8NnHrdebjrCP2URlJvOMTSUS_2KNeYHwxFrwqhn6HDFs8Phzch11epDHEK_PewASZhlakIy6kRzM3kqzzD2Dudtu8CSMKYbXOX1-E-mwLXQwgUtXLdgR4JRCn9ceuLad0uWUswTIeO4cLqauqTpOf36bYVNNKFGluafaoFzM-cpz2LdFVUYhU0/s200/SLB%20logo.png" width="200" /></a></div><p></p><p></p><br />
<b><b>Schlumberger Ltd. </b></b><b>(SLB) -- Continuation of C</b><b>overed Calls Position</b><br />
The buy/write transaction was:<br />
01/29/2024 Bought 300 Schlumberger shares @ $52.43<br />
01/29/2024 Sold 3 Schlumberger 2/16/2024 $51.00 Call options @ $2.09<br />
Note: the Time Value (aka Extrinsic Value) in the Call options was $.66 per share = [$2.09 Call options premium - ($52.43 stock price - $51.00 strike price)]<br />
02/06/2024 Quarterly ex-dividend of $.275 per share<br />2/16/2024 SLB stock price was below the $51.00 strike price, so the Calls expired and the 300 SLB shares remained in the Covered Calls Advisor Portfolio. <div>2/20/2024 Continued this SLB Covered Calls position by selling three March 1st, 2024 $50.00 Call options @ $.56 per share when the stock was trading at $48.87. The Delta for these Calls was 33.8 when this transaction was executed.</div><div>3/1/2024 SLB stock price was below the $50.00 strike price, so the Calls expired and the 300 SLB shares remained in the Covered Calls Advisor Portfolio. <div>3/4/2024 Continued this SLB Covered Calls position by selling three March 15th, 2024 $50.00 Call options @ $.91 per share when the stock was trading at $49.56. </div><div><br /></div>A possible overall performance result (including commissions) for this SLB Covered Calls position if assigned on the March 15th expiration date is as follows: <br />
Covered Calls Net Investment: $15,104.01<br />
= ($52.43 - $2.09) * 300 shares + $2.01 commission <br />
<br />
Net Profit Components:<br />
(a) Options Income: +$1,061.97<br />
= ($2.09 + $.56 + $.91) * 300 shares - $6.03 commissions<br />(b) Dividend Income: +$82.50 <br />
= ($.275 dividend per share x 300 shares)<br />
<div style="border: medium none;">(c) Capital Appreciation (If SLB shares assigned at $50.00 strike price at the March 15th options expiration): -$729.00 <br />
+($50.00 strike price - $52.43 stock purchase price) * 300 shares </div>
<div style="border: medium none;">
<br /></div>
<div style="border: medium none;">Total Net Profit (If SLB shares assigned at $50.00 strike price at the March 15th, 2024 expiration): +$415.47</div>
<div style="border: medium none;">
= (+$1,061.97 options income +$82.50 dividend income -$729.00 capital appreciation)<br />
<br />
<div style="border: medium none;">Potential Absolute Return-on-Investment (If SLB shares assigned at $50.00 at the March 15th, 2024 options expiration): +2.8%</div>
<div style="border: medium none;">
= +$415.47/$15,104.01 </div>
<div style="border: medium none;">Potential Annualized Return-on-Investment: +21.8%</div>
<div style="border: medium none;">
= (+$415.47/$15,104.01) * (365/46 days)</div>
</div>
<br /></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-16518066073934947292024-03-04T10:30:00.003-05:002024-03-04T14:29:41.365-05:00Covered Calls Position Established in Aptiv PLCThis morning my buy/write limit order for Aptiv PLC (ticker APTV) was executed. My net debit limit price of $74.18 was executed when three hundred shares were purchased at $78.14 and three March 15th, 2024 Call options were sold at $3.96 per share at the $75.00 strike price. The potential time value profit was $.82 per share = [$75.00 strike price - ($78.14 stock purchase price - $3.96 Call options price)]. An in-the-money Covered Calls position was established with a Delta of 74.6 which approximates a 74.6% probability this position will be in-the-money and therefore assigned on the March 15th, 2024 options expiration date. As desired, there is no earnings report prior to the options expiration date.<br /><p></p><p>Aptiv was part of Delphi Automotive until the spin-off of its power systems division in 2017 which became Aptiv PLC (based in Dublin, Ireland). Aptiv is one of the world's largest vehicle component manufacturers and its customers include all 25 of the leading automotive original equipment manufacturers (OEMs), but with no single company representing more than 10% of revenues. Their two divisions are Signal and Power Solutions (74%) and Advanced Safety and User Experience (26%). </p><p>As shown in the detailed chart below, Aptiv meets all 18 filters of my Quality+Value+Growth stock screener. It is now also top-rated by both Morningstar (5 stars) and CFRA (Strong Buy).</p><p></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgUnmgnfKVHQya7Ioq5i203vaXOsA3Da8haB3hwWkcBl3vmrxPpThYE2my-dtI7XecOobD2R37Rtmdx9Kfq0AksQ9TfWtyzgSv-11Jwwp9uOXk7nZWSRyn2ccMJWkAGbgxPxC4Bh-Z9EiM5CAYSDJEZxxdwReNO8pWL3-IWJVqRKDYQ71g6cPje0r4qv_U/s740/APTV%20Q+V+G.png" style="display: block; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="740" data-original-width="525" height="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgUnmgnfKVHQya7Ioq5i203vaXOsA3Da8haB3hwWkcBl3vmrxPpThYE2my-dtI7XecOobD2R37Rtmdx9Kfq0AksQ9TfWtyzgSv-11Jwwp9uOXk7nZWSRyn2ccMJWkAGbgxPxC4Bh-Z9EiM5CAYSDJEZxxdwReNO8pWL3-IWJVqRKDYQ71g6cPje0r4qv_U/s600/APTV%20Q+V+G.png" /></a></div><p><b>As detailed below, the potential return-on-investment results for this Aptiv PLC C</b><b>overed Calls position is +1.1</b><b>% absolute return (equivalent to +36.4% annualized
return-on-investment for the next 11 days) </b><b><b>if the stock is assigned on the March 15th, 2024 options expiration date.</b></b></p><div><p></p><p>
</p><p></p><p><br /><b><b><br /></b></b></p><p><b>Aptiv PLC<b> (APTV) </b></b><b>-- </b><b>New Covered Calls Position</b></p><div class="separator" style="clear: both;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhlSNPOprYJq4E3GMCYcAV9olapg5TkOhqQ8RSV2lMeV2LvpWpQHcw0_6DucJ-DhT_CG-DntoNiu-1Gs-Oz0i8AkSfnqIrsHo6G7dLxl7QG6hrX1ioTY1L85Tb8qrlk9jsaqrvOg2a0FHnP1Bj2NEcIWsxMGrpCibnn8WEgSe92mo6RgpzleIaw9Rkbp3Y/s474/APTV%20logo.png" style="clear: right; display: block; float: right; padding: 1em 0px; text-align: center;"><img alt="" border="0" data-original-height="106" data-original-width="474" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhlSNPOprYJq4E3GMCYcAV9olapg5TkOhqQ8RSV2lMeV2LvpWpQHcw0_6DucJ-DhT_CG-DntoNiu-1Gs-Oz0i8AkSfnqIrsHo6G7dLxl7QG6hrX1ioTY1L85Tb8qrlk9jsaqrvOg2a0FHnP1Bj2NEcIWsxMGrpCibnn8WEgSe92mo6RgpzleIaw9Rkbp3Y/s200/APTV%20logo.png" width="200" /></a></div>The buy/write transaction was:<br />3/4/2024 Bought 300 Aptiv PLC shares @ $78.14<br />3/4/2024 Sold 3 APTV 3/15/2024 $75.00 Call options @ $3.96 per share<b>.</b><br /><br />A possible overall performance result (including commissions) for this Aptiv Covered Calls position is as follows: <br />Aptiv Covered Calls Net Investment: $22,256.01<br />
= ($78.14 - $3.96) * 300 shares + $2.01 commission<br />
<br />
Net Profit:<br />
(a) Options Income: +$1,185.99<br />
= ($3.96 * 300 shares) - $2.01 commission <br />
(b) Dividend Income: +$0.00 <br />
= ($0.00 dividends per share x 300 shares)<br />(c) Capital Appreciation (If APTV shares assigned at $75.00 strike price at expiration): -$942.00<br />
+($75.00 - $78.14) * 300 shares<p></p>
<div style="border: medium none;">Total Net Profit (If options exercised on the 3/15/2024 options expiration date): +$243.99</div>
<div style="border: medium none;">
= (+$1,185.99 options income +$0.00 dividend income -$942.00 capital appreciation)</div><div style="border: medium none;"><br /></div><div style="border: medium none;">
<div style="border: medium none;">Potential Absolute Return-on-Investment (If the Aptiv shares are assigned at the $75.00 strike price at the March 15th, 2024 options expiration date): +1.1%</div>
<div style="border: medium none;">
= +$243.99/$22,256.01</div>
<div style="border: medium none;">Potential Annualized Return-on-Investment (If 300 Aptiv PLC shares assigned at $75.00 at the 3/15/2024 options expiration): +36.4%</div>
<div style="border: medium none;">
= (+$243.99/$22,256.01) * (365/11 days)</div>
</div>
<br /><br />
<p></p><p></p></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-74008018636346889792024-03-02T11:06:00.000-05:002024-03-02T11:06:09.259-05:00March 1st, 2024 Options Expiration ResultsThe Covered Calls Advisor Portfolio had four Covered Calls positions with March 1st, 2024 options expirations. Three positions (Delta Air Lines Inc., KraneShares CSI China Internet ETF, and Target Corporation) closed in-the-money so their Calls expired and the shares were called away (i.e. sold) at their respective strike prices. The fourth position in Schlumberger Ltd. (SLB) closed out-of-the-money so the Calls expired and the 300 SLB shares remain in the Covered Calls Advisor Portfolio. A summary of the results for each of these four positions are as follows:<p>1. <b>Delta Air Lines Inc. </b><b>-- +1.2</b><b>% absolute return (equivalent to +29.4% annualized return-on-investment) for the 15 days of this investment. </b>This Covered Call position was assigned at the $39.50 strike price on its 3/1/2024 options expiration date since Delta's stock closed in-the-money at $42.16 per share. The original post detailing the history of this Covered Calls position is <a href="https://coveredcallsadvisor.blogspot.com/2024/02/established-covered-calls-in-delta-air.html">here</a>. </p><p>2. <b>KraneShares CSI China Internet ETF (KWEB)</b><b> -- </b><b>+6.4</b><b>% absolute return (equivalent to +41.1% annualized return-on-investment) for the 57 days of this investment. </b>This Covered Calls position was assigned at the $25.50 strike price on its March 1st options expiration date since it closed in-the-money yesterday at $25.99 per share. The most recent post detailing this Covered Calls position is <a href="https://coveredcallsadvisor.blogspot.com/2024/02/continuation-of-covered-calls-position_21.html">here</a>. </p><p>3. <b>Target Corporation </b><b>-- +1.6</b><b>% absolute return (equivalent to +40.6% annualized return-on-investment) for the 14 days of this investment. </b>This Covered Call position was assigned at the $142.00 strike price on its 3/1/2024 options expiration date since Target's stock closed in-the-money at $155.29 per share. The original post detailing the history of this Covered Calls position is <a href="https://coveredcallsadvisor.blogspot.com/2024/02/covered-calls-position-established-in.html">here</a>. </p><p>4. <b>Schlumberger Ltd. (SLB)</b><b> -- </b>This Covered Calls position closed yesterday at $49.35 which was below its $50.00 strike price, so the three 3/1/2024 SLB Call options expired and 300 SLB shares now remain in the Covered Calls Advisor Portfolio. Early next week a decision will be made to either close out the position by selling the shares or continuing with this Covered Calls position by selling three SLB Calls against the 300 shares currently owned. As always, I will post the transactions-to-date for this position when my next transaction is executed.</p><p>As always, I welcome your feedback at my email address shown below with your questions or topics related to this blog post specifically or anything related to the Covered Calls investing strategy.</p><p>Best Wishes,<br /></p><p>Jeff Partlow<br />The Covered Calls Advisor<br />partlow@cox.net</p>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.comtag:blogger.com,1999:blog-4963540653553139724.post-942137815980387892024-03-02T09:12:00.003-05:002024-03-02T09:19:23.411-05:00Potential Early Assignment Situations in Yum China Holdings Inc. and Newmont Corporation There are two Covered Calls positions (Yum China Holdings Inc. and Newmont Corporation) that go ex-dividend this Monday (March 4th, 2024). Both companies stock prices were substantially in-the-money at yesterday's (i.e. Friday's) market close and with little to no time value now remaining in the Call options, so there was the possibility of early exercise of these positions by the Call options owners. The original blog posts when these positions were established are detailed <a href="https://coveredcallsadvisor.blogspot.com/2024/02/established-covered-calls-position-in_26.html">here</a> for the Yum China position and <a href="https://coveredcallsadvisor.blogspot.com/2024/02/established-covered-calls-in-newmont.html">here</a> for the Newmont position.<div><br /></div><div>There are 500 shares and 5 March 15th, 2024 $40.00 Calls for my Yum China Holdings Inc. Covered Calls position and Monday's ex-dividend amount is $.16 per share. The stock price closed yesterday at $42.95 and the Calls closed at $3.00 (at the midpoint of their $2.90/$3.10 Bid/Ask pricing). Therefore, there was only $.05 time value per share ($40.00 + $3.00 - $42.95) remaining in the Call options and 11 calendar days still remaining until the options expiration date. I was somewhat surprised that a Call owner did not choose to exercise their option to buy the 500 YUMC shares at the $40.00 strike price and capture Monday's $.16 per share dividend. But with the stock price now well in-the-money, I am satisfied to be able to capture the dividend myself and also continue with this Yum China Covered Calls position. <div><br /></div><div>There are 600 shares and 6 March 15th, 2024 $28.50 Calls for my Newmont Corp. Covered Calls position and Monday's ex-dividend is $.25 per share. Early this morning I was notified by my broker's email that a partial exercise was made. Four of my six Newmont March 15th, 2024 Calls were exercised early by an owner of those Calls and the other two Calls were not exercised and they remain in my Covered Calls Advisor Portfolio. </div><div><br /></div><div>This Newmont stock price closed yesterday at $31.94 and the Calls closed at $3.425 (at the midpoint of their $3.35/$3.50 Bid/Ask pricing). Therefore, there was $0.00 time value per share remaining in these Call options and still 11 calendar days until the 3/15/2024 options expiration date -- so I was expecting all 600 shares to be assigned. I am pleased for the 400 shares early assignment since a +68.1% annualized-return-on-investment was achieved for the 5 days duration of this position. For the remaining 200 shares Covered Calls position, my maximum potential annualized-return-on-investment is also very attractive at +45.1% over the 16 days duration if the Newmont stock price remains in-the-money (i.e. above the $28.50 strike price) at market close on the March 15th, 2024 options expiration date.</div><div><p></p></div></div>JEFF PARTLOW: THE COVERED CALLS ADVISORhttp://www.blogger.com/profile/08557852106022595430noreply@blogger.com