Diversion

Tuesday, August 13, 2013

Rolling Out IP

After rolling out SPY and BA, and then unwinding the COP and WIN positions, the only August contract I had left in Rescue My IRA was IP.  Then I rolled out to September – so there won’t be any assignments this month.  I’ve also already established replacement positions in TRV and TGT – I’ll post about those later in the week.

Between all of this action, the account has already generated 1% in cash flows for the month – really, I’m just waiting on a few ex-dividend dates now.  Maybe a few more adjustments, but most of the contracts I have now are September covered calls.

Here’s the analysis of the IP position – as with WIN, I have it in the IRA and conventional accounts.

IP – Rescue My IRA position

A 200 share position with a basis of $47.93/share, total $9,585.00. 

Total option premiums:  $501.43
Total dividend payments (including the May and August):  $120.00
Total stock gain at $48:  -$2.11
Total, absolute gain on the position:  $619.32
Total, absolute return percentage ($619.32/$9,585.00):  6.46%
Annualized total return percentage (held approx 120 days):  19.65%

IP – conventional account position

This is a 100 share position with a share basis is $47.76, total $4,775.65.

Total option premiums:  $208.96
Total dividend payments (counting ex-dates through the contract term):  $60.00
Total stock gain at $48:  $7.24
Total, absolute gain on the position:  $276.20
Total, absolute return percentage ($276.20/$4,775.65):  5.78%

Annualized total return percentage (held 120 days):  17.59%

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