Last Friday was the monthly expiration date for options
on the CBOE – I didn’t have any January calls that were subject to exercise,
having rolled those positions out (and up in some cases), but I still have a
couple of trades this month that I haven’t posted yet. So I’ll take care of that today, showing the
analysis of HAL and SWK.
As a quick forecast of my monthly results, after 10
trades I am just about even on call premiums and dividends. The monthly net is a negative $47 or so, but
with the roll-up adjustments I’ve taken during the rally here, I’ve adjusted my
strike prices upward so that I have the potential to recognize $2,500 or so in
stock gains.
That’s a fair trade, now to manage these positions to
deliver those results.
Here’s the analysis on HAL and SWK:
HAL
The HAL position
consists of 300 shares. My basis is $34.33
per share, and the stock is currently trading in the money above my $35
strike. I rolled the January contract to
February in this trade; assuming it is still in the money next month I will allow
it to be called away. It is close to meeting my goal of 12% annualized return,
but not quite there.
Total option
premiums: $643.08
Total dividend
payments (through the current contract):
$81.00
Total stock gain at $35: $182.92
Total, absolute gain
on the position: $907.00
Total, absolute return
percentage ($907.00/$10,299.90): 8.81%
Annualized total
return percentage (held approx 310 days):
10.37%
SWK
This is a100 share
position with a basis of $72.92; I’ve sold calls with a strike price of $72.50,
which would have resulted in a small loss on the sale, but my current contract
is at a $75 strike. I will allow this to be assigned assuming it is in the
money at February expiration – the stock has returned nearly 14% since I bought
it, so it met my goal.
Total option
premiums: $679.20
Total dividend
payments (through the current contract):
$139.00
Total stock gain at $75.00: $191.32
Total, absolute gain
on the position: $1,009.52
Total, absolute return
percentage ($1,009.52/$7,291.50): 13.85%
Annualized total
return percentage (held 300 days): 16.84%
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