Like many of my generational colleagues, the baby boomers, I've found that my best intentions about saving for retirement aren't always meeting the mark. In 2011, I took some old 401(k) accounts and combined them into a self-directed IRA with Scottrade, and established a strategy of using covered calls to stabilize and enhance my returns. Rescue My IRA chronicles the progress of my IRA rescue using this approach.
Thursday, February 12, 2015
Called on the ex-date for a Hat Trick: BA
Yesterday, my BA
position went ex-dividend and was called away – the stock has had a good run in
the new year so far and has traded in-the-money since January. The call was not unexpected; in fact, since I
scored a hat trick with it – earning income from covered call premiums, a
dividend payment, and a stock gain – it is one of this year’s Rescue My IRA success
Next steps for me are
to put the proceeds back to work, so I’m getting busy with research now. In the meantime, here’s the final analysis of
the BA trade, net of commissions and fees:
Bought 100 shares in September
2014 at an average price of $129.37, total position basis $12,937.00.
Sold on unwind 100
shares at $13,500.00.
(for the term of this trade, strike prices ranges from $130 to $135)
Total Net Profit after Unwinding: $759.91
Absolute Return on Investment: ($759.91/$12.937.00) = 5.87%
Annualized Return (140 days): 5.87%*(365/140) = 15.31%