Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Calls and Puts for Income -- Ignore unavailable to you. Want to Upgrade?

To: dealmakr who wrote (5215)	7/7/2012 2:07:55 AM
From: Jim P.	Respond to of 5891

Looked at Etrade for the first time in forever. Company looks like it is turning around. Option premiums are rich still. Something I will have to look at closer this weekend. Jim

To: dealmakr who wrote (5215)	7/11/2012 1:46:13 PM
From: dealmakr	1 Recommendation Read Replies (1) \| Respond to of 5891

07/11/12 New Position FCX 07/09/12 Bot 1500 FCX 34.41 (51615) 07/09/12 Sold 15 07/13 34 Call .66 07/10/12 Bot 1500 FCX 33.61 ((50415) 07/10/12 Sold 15 Jul 32 Call 1.75 07/11/12 Sold 15 Jul 33 Call .75 Closed Trades Profit/Loss 07/11/12 Dividend .3125 on 3000 shares 937.5 Total return P/L on closed trades 937.5 Long 3000 FCX avg/share 34.01 (102030) Short 15 07/13/12 34 Call 990 Short 15 Jul 32 Call 2625 Short 15 Jul 33 Call 1125 Net Position Exposure Covered Calls 3000 Shares Naked Calls 1500 Shares The purpose of the trade was to try and capture the dividend and hedge by using options. In the first entry the stock bot @ 34.41 had a .25 time value over intrinsic on the weekly series fairly close to the dividend of .3125. The 2nd buy @ 33.61 is where I put on a longer term write at the 32 level with the .14 over intrinsic at the time. I thought that I may be called out on this one, but not to be. Looking at the total premium written of the calls of 4740 and subtracting that amount from the total cost would give me an adjusted cost of 32.43 if they expired with some downside protection from initial purchase price, not including the dividend. If exercised on the 32&33 strikes same thing, no gain on the stock except for the dividend capture. The short 34 calls may be bot in to cover. If exercised on the lower strike, will look to use the weekly series to write more CC's until I hopefully get called away. This position doesn't include the short Nov 26 puts that I have open. Very tough market out there especially in this sector. Just wanted to throw this one out there and see if anyone has a comment on using options for dividend capture. Good trading dealmakr

To: dealmakr who wrote (5215)	7/21/2012 6:50:40 AM
From: dealmakr	Read Replies (1) \| Respond to of 5891

07/21/12 Updated Position ETFC 06/19/12 Bot 3000 ETFC 7.91 (23730) 06/19/12 Sold 30 Jul 8 Call .37* 06/19/12 Sold 30 Jul 7 Put .12* 06/21/12 Bot 2000 ETFC 7.83 (15660) 06/21/12 Sold 20 Jul 8 Call .32* 06/22/12 Bot 2500 ETFC 7.78 (19450)* 06/22/12 Sold 25 Jul 8 Call .30* 06/22/12 Sold 30 Jul 7 Put .12* 06/26/12 Sold 20 Oct 7 Put .56 07/02/12 Sold 10 Oct 8 Call .71 07/06/12 Sold 10 Oct 8 Call .72 07/09/12 Sold 20 Aug 8 call .26 07/10/12 Bot 2000 ETFC 7.63 (15260) 07/16/12 Bot 2000 ETFC 7.86 (15720) 07/20/12 Sold 50 Aug 8 Call .15 Closed trades Profit/Loss 07/20/12 Sold 2500 ETFC 7.50 (700) 07/21/12 Expired 60 Jul 7 Put 720 07/21/12 Expired 75 Jul 8 Call 2500 Total return P/L on closed trades 2520 Long 9000 ETFC avg/share 7.82 (70370) Stock closed 07/20/12 7.39 Short 70 Aug 8 Call 1270 Short 20 Oct 7 Put 1120 Short 20 Oct 8 Call 1430 Net Position Exposure Covered Calls 9000 Shares Naked Puts 2000 Shares Earnings to me came out ok, but showed continued weakness in DART's. The bank side continues to contract by about 200mm per month and losses there are still looking manageable. This one also sold off with the banks and decided to reduce the position by 2500 shares with the premise that if things continue to weaken can buy them back cheaper or write additional NP's. Longer term timeframe should IMHO work out ok. Good trading dealmakr