Monday, September 30, 2013

Monthly Results: September 2013

September was another good month – I remember that back in May, I thought it would be the month for a correction or stabilization after everybody got back from vacations.  Instead, the Rescue My IRA climbed steadily throughout the month from the August level of $145K to close out September at more than $148K. The Fed spoke and said it would take it easy on fiscal moves, Syria appeared to stabilize, but we ended the month with the pending government shutdown and even the threat from Congressional Republicans of a default on US debt – if you can believe that!

An overview of investing activities for the month of September would have to highlight capital gains on my BA and GE shares.  I took action to unwind the BA shares at a gain, reinvested the proceeds in a GE weekly position that was called away, and then swept those proceeds into a TXT positions a couple of months out – just recognizing the capital gains from BA and GE yields nearly $700 in profits. 

The gains, plus dividends in the amount of $415 and covered call premiums for $360 (net) mean I met my goal for a 1% return per month, and the current statement value of the account shows a nearly 12% increase for the calendar year. 

I still plan to upgrade my Scottrade account soon, in order to give me more flexibility in a steady/consolidation market next year, but in the meantime, like I said above, it’s covered calls for me.  

So, finally, here is a summary of the Rescue My IRA statistics for September 2013, based on the September 30 market close:   

Account Status:
·         Total Account Value, 9/30/2013 Market Close:  $148,452.86 (vs. August close of $145,215.47)
·         Total Cash Reserve, 9/30/2013 Market Close:  $11,251.86
·         Core Stock Positions (as of 9/30/2013):   AFL (200 shares), CAT (100 shares), CMI (100 shares), DVN (200 shares), F (200 shares), IP (200 shares), KO (300 shares), PFE (400 shares), PSA (100 shares), SPY (100 shares), TGT (100 shares), and TRV (100 shares), TXT (300 shares)

Performance Metrics:
Option Premiums Collected (net, month of September):  $360.41 (0.27 %)
Capital Gains Collected (net, month of September):  $675.58 (0.51%)
Dividends Collected (recognized on the ex-date): $415.00 (0.31%)
Interest on Cash Reserve (estimated): $0.11
Total, Absolute Return:  $1,451.10
Absolute Return, Percentage Basis:  1.09%
Annualized Return, Percentage Basis:  13.29%

Next Month To-dos:

Turns out that October will be a light month for dividends – less than $200 is forecast from three positions:  CAT, F, and PFE.  All three of these positions have November contracts, so it is unlikely that they will be called away early.

There are currently six October contracts:  DVN, PSA, SPY, TGT, TRV, and TXT.  At the time of this post, only the PSA and TRV positions are in-the-money; if they are both called away I will end up with a slight capital loss, since I sold at-the-money calls on these.  I may try to do a little repair on the PSA position before the month is over – I originally started by selling $165 strikes, but rolled down to $160 – there may be room to roll-up if I extend the term out to the back months.

Well, those kinds of things make the whole Rescue My IRA a good time.  I really have my work cut out for me to generate the 1% return this month.  Fortunately I have six positions to work with – we’ll see what we can do.

Next month will be over before we know it.  Happy investing!

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