Wow – we only had two
and half trading days so far in July, but I’ve made the best of it in the
Rescue My IRA account. Besides rolling
out my CAT position, I unwound a couple of winners and used them to offset a
loser, and then established new positions with the proceeds. As a result, I have three posts going up here
on the blog over the course of the next few days.
Looking at my trading
history with this CAT position, I see I first sold a Nov 2012 call with a $90
strike price. Assuming the shares are
called with this new contract – also a $90 strike, for November 2013, I will
have had the shares for just more than a year – let’s call it 15 months. As the analysis shows, it is performing right
on target, with an annualized return of just over 12 percent.
Here’s the analysis of
the CAT positions.
CAT
This is a 100 share
position with a basis of $87.17, established in the fall of 2012. I have sold
$90, $92.50, and $95 strikes, rolling them more or less monthly. This transaction rolled out August options to
November, stretching a bit to get the net premium up over $100 and to cover a
last ex-dividend date.
Total option
premiums: $796.67
Total dividend payments
(including the forecast October 2013 ex-dividend): $276.00
Total stock gain at $90: $265.83
Total, absolute gain
on the position: $1,338.50
Total, absolute return
percentage ($1,338.50/$8,717.00): 15.36%
Annualized total
return percentage (held approx 450 days):
12.45%
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