Deciding Which Option to Sell on an Existing Position

Every options expiration weekend I go through a process of deciding which option to sell on existing positions where the current option has expired. This article will describe that process.

I start out by calculating how much option premium I need in order to provide a 12% annual yield on the original stock investment. For non-dividend paying stocks the calculation is simple, just multiply the per share cost basis of the stock by 1% to get the monthly premium required. For dividend paying stocks, I must first calculate the dividend yield based on my cost basis, not on the current stock price. Then determine how much option premium I need to add in order to yield 12% annually, and finally divide the total by 12 to get the monthly premium required.

Here are the formulas I use:

Yield on Cost = Annual Dividend / Cost Basis per Share
Required Option Yield = 12% - Yield on Cost
Required Option Premium = Cost Basis per Share * Required Option Yield
Required Monthly Premium = Required Option Premium / 12

The following are a few examples using some of the positions I adjusted yesterday.

Example 1 - ADP

Cost Basis per Share: $43.08
Annual Dividend: $1.32
Yield on Cost: 3.06%
Required Option Yield = 8.94%
Required Option Premium = $3.85
Total Annual Income = $5.17
Total Annual Yield = 12%
Required Monthly Premium = $0.32

So, in order to get a 12% annual yield from dividends and option premiums I only needed to sell an ADP option for $0.32 per month. Now, I wanted to go two strikes OTM on this position to get back to the original strike price. The Jan09 42.50 call had a bid of less than $0.32 so it didn't meet my criteria. So I needed to go out an extra month, which meant I needed to get at least $0.64 for 2 months, $0.92 for 3 months, etc. So, I sold a Feb 42.50 call for $0.91, which was almost 3 months worth of option premium for a 2 month call.

Example 2 - BAC

Cost Basis per Share: $33.72
Annual Dividend: $1.28
Yield on Cost: 3.80%
Required Option Yield = 8.20%
Required Option Premium = $2.77
Total Annual Income = $4.05
Total Annual Yield = 12%
Required Monthly Premium = $0.23

In this example I only needed $0.23 and was able to get twice that amount by selling the Jan09 16.00 call, two strikes OTM, for $0.47.

Example 3 - BBT

Cost Basis per Share: $33.36
Annual Dividend: $1.88
Yield on Cost: 5.64%
Required Option Yield = 6.36%
Required Option Premium = $2.12
Total Annual Income = $4.00
Total Annual Yield = 12%
Required Monthly Premium = $0.18

In this example I only needed $0.18 and was able to get $0.19 by selling the Jan09 32.50 call, three strikes OTM.

Example 4 - WFMI

Cost Basis per Share: $42.82
Annual Dividend: $0.00 (dividend suspended)
Yield on Cost: 0.00%
Required Option Yield = 12%
Required Option Premium = $5.14
Total Annual Income = $5.14
Total Annual Yield = 12%
Required Monthly Premium = $0.43

This is an example of a non-dividend paying stock. In this case, the dividend was suspended. I needed $0.43 for a Jan09 11.00 call, two strikes OTM, but wasn't able to get it. Nor could I get $0.86 for a Feb09 11.00 call, although I could have gotten $0.84 on a Feb09 10.00 call but that was too close to the money. So I had to settle for the Feb09 11.00 call at $.43, about half of what I needed.

This method helps me determine how much option premium I need to meet my goal of 12% annual yield on the overall portfolio. Sometimes I get more on a given position and sometimes I get less, but on average I should be able to meet my goal on the entire portfolio. I hope this article has provided some insight into my thought process.

TLT - New Position

A new position was established today on TLT. The following is the trade information, including IB commissions:

22-Dec-08 - Initial Stock Position - BTO 100 TLT @ 121.03
22-Dec-08 - Initial Call Option - STO 1 Jan09 121.00 Call @ 3.39

Stock Investment: $12,102.95
Income Generated: $339.00
Percent Income Generated: 2.80%
Annualized Income Generated: 40.89%
Net Profit If Called: $336.05
Percent Return If Called: 2.78%
Annualized Return If Called: 40.54%
Days Held to Expiration: 25 days

APD - New Position

A new position was established today on APD. The following is the trade information, including IB commissions:

22-Dec-08 - Initial Stock Position - BTO 100 APD @ 45.68
22-Dec-08 - Initial Call Option - STO 1 Jan09 45.00 Call @ 2.29

Stock Investment: $4,568.00
Income Generated: $229.00
Percent Income Generated: 5.01%
Annualized Income Generated: 73.19%
Net Profit If Called: $161.00
Percent Return If Called: 3.52%
Annualized Return If Called: 51.46%
Days Held to Expiration: 25 days

WGO - Adjustment

The following adjustment was made today on WGO:

22-Dec-08 - Interim Trade - STO 2 Feb09 7.50 Call @ 0.14 -

Current Position Summary:

Stock Investment: $6,455.00
Income Generated: $1,758.70
Percent Income Generated: 27.25%
Annualized Income Generated: 7.58%
Net Profit If Called: -$3,196.30
Percent Return If Called: -49.52%
Annualized Return If Called: -13.78%
Days Held to Expiration: 1312 days

Trade History:

19-Jul-05 - Initial Stock Position - BTO 100 WGO @ 34.92 -
19-Jul-05 - Initial Call Option - STO 1 Aug05 35.00 Call @ 1.09 - Expired
22-Aug-05 - Continued Trade - STO 1 Sep05 35.00 Call @ 0.44 - Closed
01-Sep-05 - Buy Back & Roll Out - BTC 1 Sep05 35.00 Call @ -0.06 -
19-Sep-05 - Continued Trade - STO 1 Nov05 35.00 Call @ 0.34 - Closed
03-Oct-05 - Dividend Received - DIV 100 Dividend @ 0.09 -
21-Oct-05 - Buy Back & Roll Down - BTC 1 Nov05 35.00 Call @ -0.06 -
24-Oct-05 - Interim Trade - STO 1 Nov05 30.00 Call @ 0.24 - Closed
14-Nov-05 - Buy Back & Roll Up - BTC 1 Nov05 30.00 Call @ -2.66 -
21-Nov-05 - Continued Trade - STO 1 Jan06 35.00 Call @ 0.99 - Expired
09-Jan-06 - Dividend Received - DIV 100 Dividend @ 0.09 -
23-Jan-06 - Continued Trade - STO 1 Mar06 35.00 Call @ 0.44 - Expired
20-Mar-06 - Dollar Cost Averaging - BTO 100 WGO @ 29.63 -
20-Mar-06 - Combined Cost Basis - $6,455.00 200 @ 32.28 -
20-Mar-06 - Continued Trade - STO 2 Jul05 35.00 Call @ 0.69 - Expired
03-Apr-06 - Dividend Received - DIV 100 Dividend @ 0.09 -
10-Jul-06 - Dividend Received - DIV 200 Dividend @ 0.09 -
24-Jul-06 - Continued Trade - STO 2 Jan07 35.00 Call @ 1.39 - Closed
09-Oct-06 - Dividend Received - DIV 200 Dividend @ 0.10 -
22-Dec-06 - Buy Back & Roll Out - BTC 2 Jan07 35.00 Call @ -0.16 -
22-Dec-06 - Continued Trade - STO 2 Apr07 35.00 Call @ 1.19 - Expired
08-Jan-07 - Dividend Received - DIV 200 Dividend @ 0.10 -
09-Apr-07 - Dividend Received - DIV 200 Dividend @ 0.10 -
23-Apr-07 - Continued Trade - STO 2 May07 35.00 Call @ 0.54 - Expired
21-May-07 - Continued Trade - STO 2 Jun07 35.00 Call @ 0.09 - Expired
19-Jun-07 - Continued Trade - STO 2 Jan08 35.00 Call @ 0.94 - Expired
09-Jul-07 - Dividend Received - DIV 200 Dividend @ 0.10 -
08-Oct-07 - Dividend Received - DIV 200 Dividend @ 0.12 -
24-Jan-08 - Interim Trade - STO 2 Feb08 22.50 Call @ 0.44 - Expired
21-Feb-08 - Interim Trade - STO 2 Apr08 22.50 Call @ 0.79 - Expired
07-Apr-08 - Dividend Received - DIV 200 Dividend @ 0.12 -
23-Apr-08 - Interim Trade - STO 2 Jul08 17.50 Call @ 0.49 - Expired
08-Jul-08 - Dividend Received - DIV 200 Dividend @ 0.12 -
22-Jul-08 - Interim Trade - STO 2 Sep08 15.00 Call @ 0.40 - Closed
12-Sep-08 - Buy Back & Roll Out - BTC 2 Sep08 15.00 Call @ -0.06 -
12-Sep-08 - Interim Trade - STO 2 Oct08 15.00 Call @ 0.23 - Expired
06-Oct-08 - Dividend Received - DIV 200 Dividend @ 0.12 -
20-Oct-08 - Interim Trade - STO 2 Dec08 10.00 Call @ 0.15 - Expired
22-Dec-08 - Interim Trade - STO 2 Feb09 7.50 Call @ 0.14 -

WFMI - Adjustment

The following adjustment was made today on WFMI:

22-Dec-08 - Interim Trade - STO 2 Feb09 11.00 Call @ 0.56 -

Current Position Summary:

Stock Investment: $8,563.00
Income Generated: $1,968.00
Percent Income Generated: 22.98%
Annualized Income Generated: 12.54%
Net Profit If Called: -$4,395.00
Percent Return If Called: -51.33%
Annualized Return If Called: -28.00%
Days Held to Expiration: 669 days

Trade History:

23-Apr-07 - Initial Stock Position - BTO 100 WFMI @ 47.19 - VICC
23-Apr-07 - Initial Call Option - STO 1 May07 50.00 Call @ 0.83 - Expired
21-May-07 - Interim Trade - STO 1 Jul07 45.00 Call @ 0.24 - Closed
21-Jun-07 - Buy Back and Roll Out - BTC 1 Jul07 45.00 Call @ -0.03 -
21-Jun-07 - Dollar Cost Averaging - BTO 100 WFMI @ 38.44 -
21-Jun-07 - Combined Cost Basis - $8,563.00 200 @ 42.82 -
21-Jun-07 - Continued Trade - STO 2 Aug07 45.00 Call @ 0.29 - Expired
24-Jul-07 - Dividend Received - DIV 200 Dividend @ 0.18 -
20-Aug-07 - Continued Trade - STO 2 Sep07 50.00 Call @ 0.20 - Expired
24-Sep-07 - Continued Trade - STO 2 Oct07 50.00 Call @ 0.16 - Expired
22-Oct-07 - Continued Trade - STO 2 Dec07 50.00 Call @ 2.64 - Expired
14-Jan-08 - Continued Trade - STO 2 May08 45.00 Call @ 1.45 - Closed
22-Jan-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
22-Apr-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
28-Apr-08 - Buy Back & Roll Down - BTC 2 May08 45.00 Call @ -0.06 -
28-Apr-08 - Interim Trade - STO 2 May08 34.00 Call @ 0.53 - Expired
22-May-08 - Interim Trade - STO 2 Jul08 31.00 Call @ 0.54 - Expired
22-Jul-08 - Interim Trade - STO 2 Aug08 24.00 Call @ 0.89 - Expired
22-Aug-08 - Interim Trade - STO 2 Oct08 21.00 Call @ 0.43 - Expired
20-Oct-08 - Interim Trade - STO 2 Nov08 17.00 Call @ 0.44 - Expired
24-Nov-08 - Interim Trade - STO 2 Dec08 11.00 Call @ 0.27 - Expired
22-Dec-08 - Interim Trade - STO 2 Feb09 11.00 Call @ 0.56 -

UTX - Adjustment

The following adjustment was made today on UTX:

22-Dec-08 - Interim Trade - STO 1 Feb09 60.00 Call @ 0.60 -

Current Position Summary:

Stock Investment: $7,524.00
Income Generated: $641.50
Percent Income Generated: 8.53%
Annualized Income Generated: 10.59%
Net Profit If Called: -$882.50
Percent Return If Called: -11.73%
Annualized Return If Called: -14.56%
Days Held to Expiration: 294 days

Trade History:

02-May-08 - Initial Stock Position - BTO 100 UTX @ 75.24 -
02-May-08 - Initial Call Option - STO 1 Jun08 75.00 Call @ 2.37 - Expired
10-Jun-08 - Dividend Received - DIV 100 Dividend @ 0.32 -
07-Jul-08 - Interim Trade - STO 1 Aug08 70.00 Call @ 0.26 - Expired
22-Aug-08 - Interim Trade - STO 1 Sep08 70.00 Call @ 0.35 - Closed
10-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.32 -
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 70.00 Call @ -0.06 -
12-Sep-08 - Interim Trade - STO 1 Oct08 70.00 Call @ 0.69 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 60.00 Call @ 0.39 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 55.00 Call @ 0.79 - Expired
10-Dec-08 - Dividend Received - DIV 100 Dividend @ 0.39 -
22-Dec-08 - Interim Trade - STO 1 Feb09 60.00 Call @ 0.60 -

USB - Adjustment

The following adjustment was made today on USB:

22-Dec-08 - Interim Trade - STO 1 Feb09 30.00 Call @ 0.50 -

Current Position Summary:

Stock Investment: $3,494.00
Income Generated: $460.80
Percent Income Generated: 13.19%
Annualized Income Generated: 14.50%
Net Profit If Called: -$33.20
Percent Return If Called: -0.95%
Annualized Return If Called: -1.04%
Days Held to Expiration: 332 days

Trade History:

25-Mar-08 - Initial Stock Position - BTO 100 USB @ 34.94 -
25-Mar-08 - Initial Call Option - STO 1 May08 35.00 Call @ 1.39 - Expired
15-Apr-08 - Dividend Received - DIV 100 Dividend @ 0.43 -
22-May-08 - Continued Trade - STO 1 Jun08 35.00 Call @ 0.28 - Expired
07-Jul-08 - Interim Trade - STO 1 Aug08 32.50 Call @ 0.14 - Expired
15-Jul-08 - Dividend Received - DIV 100 Dividend @ 0.43 -
22-Aug-08 - Continued Trade - STO 1 Sep08 32.50 Call @ 0.59 - Closed
12-Sep-08 - Buy Back & Roll Out/Up - BTC 1 Sep08 32.50 Call @ -1.76 -
12-Sep-08 - Continued Trade - STO 1 Dec08 35.00 Call @ 2.19 - Expired
15-Oct-08 - Dividend Received - DIV 100 Dividend @ 0.43 -
22-Dec-08 - Interim Trade - STO 1 Feb09 30.00 Call @ 0.50 -

TGT - Adjustment

The following adjustment was made today on TGT:

22-Dec-08 - Interim Trade - STO 1 Feb09 40.00 Call @ 1.41 -

Current Position Summary:

Stock Investment: $5,937.00
Income Generated: $1,320.75
Percent Income Generated: 22.25%
Annualized Income Generated: 18.04%
Net Profit If Called: -$616.25
Percent Return If Called: -10.38%
Annualized Return If Called: -8.42%
Days Held to Expiration: 450 days

Trade History:

28-Nov-07 - Initial Stock Position - BTO 100 TGT @ 59.37 -
28-Nov-07 - Initial Call Option - STO 1 Dec07 55.00 Call @ 5.66 - Expired
07-Jan-08 - Continued Trade - STO 1 Feb07 55.00 Call @ 0.84 - Expired
21-Feb-08 - Continued Trade - STO 1 Mar08 55.00 Call @ 1.44 - Expired
10-Mar-08 - Dividend Received - DIV 100 Dividend @ 0.14 -
25-Mar-08 - Continued Trade - STO 1 Apr08 55.00 Call @ 1.31 - Expired
23-Apr-08 - Interim Trade - STO 1 May08 55.00 Call @ 0.62 - Closed
16-May-08 - Buy Back & Roll Out/Up - BTC 1 May08 55.00 Call @ -0.11 -
19-May-08 - Continued Trade - STO 1 Jun08 57.50 Call @ 1.21 - Expired
10-Jun-08 - Dividend Received - DIV 100 Dividend @ 0.14 -
07-Jul-08 - Continued Trade - STO 1 Jul08 50.00 Call @ 0.58 - Expired
22-Jul-08 - Continued Trade - STO 1 Sep08 50.00 Call @ 1.25 - Closed
10-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.16 -
12-Sep-08 - Buy Back & Roll Out/Up - BTC 1 Sep08 50.00 Call @ -6.80 -
12-Sep-08 - Continued Trade - STO 1 Oct08 57.50 Call @ 2.62 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 45.00 Call @ 1.18 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 35.00 Call @ 1.39 - Expired
10-Dec-08 - Dividend Received - DIV 200 Dividend @ 0.16 -
22-Dec-08 - Interim Trade - STO 1 Feb09 40.00 Call @ 1.41 -

PFE - Adjustment

The following adjustment was made today on PFE:

22-Dec-08 - Interim Trade - STO 2 Mar09 20.00 Call @ 0.31 -

Current Position Summary:

Stock Investment: $4,565.00
Income Generated: $595.80
Percent Income Generated: 13.05%
Annualized Income Generated: 11.32%
Net Profit If Called: $30.80
Percent Return If Called: 0.67%
Annualized Return If Called: 0.58%
Days Held to Expiration: 421 days

Trade History:

24-Jan-08 - Initial Stock Position - BTO 200 PFE @ 22.83 -
24-Jan-08 - Initial Call Option - STO 2 Mar08 22.50 Call @ 0.96 - Expired
04-Mar-08 - Dividend Received - DIV 200 Dividend @ 0.32 -
25-Mar-08 - Continued Trade - STO 2 Jun08 22.50 Call @ 0.24 - Expired
03-Jun-08 - Dividend Received - DIV 200 Dividend @ 0.32 -
24-Jul-08 - Continued Trade - STO 1 Dec08 22.50 Call @ 0.22 -
24-Jul-08 - Continued Trade - STO 1 Dec08 22.50 Call @ 0.22 - Expired
29-Jul-08 - Continued Trade - STO 1 Dec08 22.50 Call @ 0.14 - Expired
03-Sep-08 - Dividend Received - DIV 200 Dividend @ 0.32 -
02-Dec-08 - Dividend Received - DIV 200 Dividend @ 0.32 -
22-Dec-08 - Interim Trade - STO 2 Mar09 20.00 Call @ 0.31 -

KO - Adjustment

The following adjustment was made today on KO:

22-Dec-08 - Interim Trade - STO 1 Jan09 47.50 Call @ 0.55 -

Current Position Summary:

Stock Investment: $5,022.00
Income Generated: $379.00
Percent Income Generated: 7.55%
Annualized Income Generated: 24.16%
Net Profit If Called: $107.00
Percent Return If Called: 2.13%
Annualized Return If Called: 6.82%
Days Held to Expiration: 114 days

Trade History:

24-Sep-08 - Initial Stock Position - BTO 100 KO @ 50.22 -
24-Sep-08 - Initial Call Option - STO 1 Oct08 50.00 Call @ 1.59 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 50.00 Call @ 0.79 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 50.00 Call @ 0.48 - Expired
15-Dec-08 - Dividend Received - DIV 100 Dividend @ 0.38 -
22-Dec-08 - Interim Trade - STO 1 Jan09 47.50 Call @ 0.55 -

JNJ - Adjustment

The following adjustment was made today on JNJ:

22-Dec-08 - Continued Trade - STO 1 Jan09 60.00 Call @ 1.45 -

Current Position Summary:

Stock Investment: $6,146.00
Income Generated: $630.60
Percent Income Generated: 10.26%
Annualized Income Generated: 50.61%
Net Profit If Called: $484.60
Percent Return If Called: 7.88%
Annualized Return If Called: 38.89%
Days Held to Expiration: 74 days

Trade History:

03-Nov-08 - Initial Stock Position - BTO 100 JNJ @ 61.46 -
03-Nov-08 - Initial Call Option - STO 1 Nov08 60.00 Call @ 2.95 - Expired
24-Nov-08 - Continued Trade - STO 1 Dec08 60.00 Call @ 1.90 - Expired
22-Dec-08 - Continued Trade - STO 1 Jan09 60.00 Call @ 1.45 -

GE - Adjustment

The following adjustment was made today on GE:

24-Nov-08 - Interim Trade - STO 1 Dec08 17.50 Call @ 0.29 -

Current Position Summary:

Stock Investment: $2,501.00
Income Generated: $261.00
Percent Income Generated: 10.44%
Annualized Income Generated: 25.39%
Net Profit If Called: -$440.00
Percent Return If Called: -17.59%
Annualized Return If Called: -42.81%
Days Held to Expiration: 150 days

Trade History:

23-Sep-08 - Initial Stock Position - BTO 100 GE @ 25.01 -
23-Sep-08 - Initial Call Option - STO 1 Oct08 25.00 Call @ 1.79 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 22.00 Call @ 0.34 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 22.00 Call @ 0.34 - Expired
22-Dec-08 - Interim Trade - STO 1 Feb09 18.00 Call @ 0.48 -

EXP - Adjustment

The following adjustments were made today on EXP:

22-Dec-08 - Interim Trade - STO 2 Feb09 22.50 Call @ 0.64 -

Current Position Summary:

Stock Investment: $10,856.00
Income Generated: $2,731.95
Percent Income Generated: 25.17%
Annualized Income Generated: 8.89%
Net Profit If Called: -$3,624.05
Percent Return If Called: -33.38%
Annualized Return If Called: -11.80%
Days to Expiration: 1033 days

Trade History:

24-Apr-06 - Initial Stock Position - BTO 100 EXP @ 70.60 -
24-Apr-06 - Initial Call Option - STO 1 May06 65.00 Call @ 8.29 - Expired
22-May-06 - Continued Trade - STO 1 Oct06 60.00 Call @ 2.39 -
20-Jul-06 - Dividend Received - DIV 100 Dividend @ 0.18 -
25-Jul-06 - Interim Trade - STO 1 Jan07 50.00 Call @ 2.19 - Closed
25-Jul-06 - Buy Back & Roll Out/Down - BTC 1 Oct06 60.00 Call @ -0.21 - Closed
23-Oct-06 - Interim Trade - STO 1 Jan07 40.00 Call @ 1.34 - Closed
23-Oct-06 - Buy Back & Roll Down - BTC 1 Jan07 50.00 Call @ -0.26 -
02-Nov-06 - Dividend Received - DIV 100 Dividend @ 0.18 -
19-Dec-06 - Buy Back & Roll Out/Up - BTC 1 Jan07 40.00 Call @ -3.41 -
19-Dec-06 - Interim Trade - STO 1 Jul07 45.00 Call @ 4.39 - Closed
05-Jul-07 - Interim Trade - STO 1 Jan08 55.00 Call @ 3.29 - Closed
05-Jul-07 - Buy Back & Roll Out/Up - BTC 1 Jul07 45.00 Call @ -5.41 -
20-Jul-07 - Dividend Received - DIV 100 Dividend @ 0.20 -
24-Oct-07 - Buy Back & Roll Down - BTC 1 Jan08 55.00 Call @ -0.16 -
24-Oct-07 - Second Stock Position - BTO 100 EXP @ 37.96 -
24-Oct-07 - Combined Cost Basis - $10,856.00 200 @ 54.28 -
24-Oct-07 - Interim Trade - STO 2 Jan08 45.00 Call @ 0.69 - Expired
05-Nov-07 - Dividend Received - DIV 100 Dividend @ 0.20 -
21-Jan-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
24-Jan-08 - Interim Trade - STO 2 Feb08 35.00 Call @ 1.29 - Expired
21-Feb-08 - Interim Trade - STO 2 Apr08 40.00 Call @ 0.84 - Expired
18-Apr-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
23-Apr-08 - Interim Trade - STO 2 Jul08 40.00 Call @ 0.99 - Expired
22-Jul-08 - Interim Trade - STO 1 Oct08 30.00 Call @ 0.54 - Expired
23-Jul-08 - Interim Trade - STO 1 Sep08 30.00 Call @ 0.34 - Closed
24-Jul-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 30.00 Call @ -0.36 -
12-Sep-08 - Interim Trade - STO 1 Oct08 30.00 Call @ 1.09 - Expired
20-Oct-08 - Interim Trade - STO 2 Nov08 20.00 Call @ 0.64 - Expired
06-Nov-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
24-Nov-08 - Interim Trade - STO 2 Dec08 20.00 Call @ 0.34 - Expired
22-Dec-08 - Interim Trade - STO 2 Feb09 22.50 Call @ 0.64 -

EMR - Adjustment

The following adjustment was made today on EMR:

22-Dec-08 - Continued Trade - STO 1 Jan09 35.00 Call @ 1.56 -

Current Position Summary:

Stock Investment: $3,569.00
Income Generated: $533.00
Percent Income Generated: 14.93%
Annualized Income Generated: 75.71%
Net Profit If Called: $464.00
Percent Return If Called: 13.00%
Annualized Return If Called: 65.91%
Days Held to Expiration: 72 days

Trade History:

05-Nov-08 - Initial Stock Position - BTO 100 EMR @ 35.69 -
05-Nov-08 - Initial Call Option - STO 1 Nov08 35.00 Call @ 1.90 - Expired
24-Nov-08 - Continued Trade - STO 1 Dec08 35.00 Call @ 1.54 - Expired
10-Dec-08 - Dividend Received - DIV 100 Dividend @ 0.33 -
22-Dec-08 - Continued Trade - STO 1 Jan09 35.00 Call @ 1.56 -

DOV - Adjustment

The following adjustment was made today on DOV:

22-Dec-08 - Interim Trade - STO 1 Jan09 35.00 Call @ 0.29 -

Current Position Summary:

Stock Investment: $5,421.00
Income Generated: $339.00
Percent Income Generated: 6.25%
Annualized Income Generated: 9.43%
Net Profit If Called: -$1,582.00
Percent Return If Called: -29.18%
Annualized Return If Called: -40.02%
Days Held to Expiration: 242 days

Trade History:

19-May-08 - Initial Stock Position - BTO 100 DOV @ 54.21 -
19-May-08 - Initial Call Option - STO 1 Jun08 55.00 Call @ 1.15 - Expired
15-Jun-08 - Dividend Received - DIV 100 Dividend @ 0.20 -
07-Jul-08 - Continued Trade - STO 1 Sep08 55.00 Call @ 0.47 - Expired
15-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.25 -
23-Sep-08 - Interim Trade - STO 1 Dec08 50.00 Call @ 0.78 - Expired
15-Dec-08 - Dividend Received - DIV 100 Dividend @ 0.25 -
22-Dec-08 - Interim Trade - STO 1 Jan09 35.00 Call @ 0.29 -

DHI - Adjustment

The following adjustments were made today on DHI:

22-Dec-08 - Interim Trade - STO 3 Feb09 10.00 Call @ 0.44 -

Current Position Summary:

Stock Investment: $8,777.00
Income Generated: $2,275.90
Percent Income Generated: 25.93%
Annualized Income Generated: 7.29%
Net Profit If Called: -$3,501.10
Percent Return If Called: -39.89%
Annualized Return If Called: -11.21%
Days Held to Expiration: 1299 days

Trade History:

01-Aug-05 - Initial Stock Position - BTO 100 DHI @ 40.18 -
01-Aug-05 - Initial Call Option - STO 1 Aug05 40.00 Call @ 1.29 - Expired
19-Aug-05 - Dividend Received - DIV 100 Dividend @ 0.09 -
22-Aug-05 - Continued Trade - STO 1 Oct05 40.00 Call @ 0.54 - Closed
05-Oct-05 - Buy Back & Roll Out/Down - BTC 1 Oct05 40.00 Call @ -0.11 -
24-Oct-05 - Interim Trade - STO 1 Nov05 35.00 Call @ 0.49 - Closed
31-Oct-05 - Dividend Received - DIV 100 Dividend @ 0.09 -
18-Nov-05 - Buy Back & Roll Out/Up - BTC 1 Nov05 35.00 Call @ -0.31 -
21-Nov-05 - Continued Trade - STO 1 Dec05 40.00 Call @ 0.34 - Expired
09-Jan-06 - Continued Trade - STO 1 Jan06 40.00 Call @ 0.49 - Expired
23-Jan-06 - Continued Trade - STO 1 Feb06 40.00 Call @ 0.69 - Expired
10-Feb-06 - Dividend Received - DIV 100 Dividend @ 0.10 -
21-Feb-06 - Continued Trade - STO 1 Apr06 40.00 Call @ 0.44 - Closed
23-Mar-06 - Buy Back & Roll Out - BTC 1 Apr06 40.00 Call @ -0.11 -
23-Mar-06 - Continued Trade - STO 1 Aug06 40.00 Call @ 0.94 -
19-May-06 - Dividend Received - DIV 100 Dividend @ 0.10 -
23-May-06 - Buy Back & Roll Out/Down - BTC 1 Aug06 40.00 Call @ -0.11 - Closed
23-May-06 - Second Stock Position - BTO 100 DHI @ 26.89 -
23-May-08 - Combined Cost Basis - $6,707.00 200 @ 33.54 -
23-May-06 - Continued Trade - STO 2 Jan07 35.00 Call @ 1.04 -
25-Jul-06 - Buy Back & Roll Down - BTC 2 Jan07 35.00 Call @ -0.16 - Closed
25-Jul-06 - Third Stock Position - BTO 100 DHI @ 20.70 -
25-Jul-06 - Combined Cost Basis - $8,777.00 300 @ 29.26 -
25-Jul-06 - Interim Trade - STO 3 Jan07 25.00 Call @ 0.99 - Closed
01-Nov-06 - Dividend Received - DIV 300 Dividend @ 0.15 -
19-Dec-06 - Buy Back & Roll Up - BTC 3 Jan07 25.00 Call @ -2.36 -
19-Dec-06 - Continued Trade - STO 3 Jan08 30.00 Call @ 2.74 - Expired
09-Feb-07 - Dividend Received - DIV 300 Dividend @ 0.15 -
18-May-07 - Dividend Received - DIV 300 Dividend @ 0.15 -
27-Aug-07 - Dividend Received - DIV 300 Dividend @ 0.15 -
16-Nov-07 - Dividend Received - DIV 300 Dividend @ 0.15 -
24-Jan-08 - Interim Trade - STO 3 Feb08 15.00 Call @ 0.69 - Closed
20-Feb-08 - Dividend Received - DIV 300 Dividend @ 0.15 -
21-Feb-08 - Interim Trade - STO 3 Mar08 17.50 Call @ 0.39 - Expired
25-Mar-08 - Interim Trade - STO 3 May08 20.00 Call @ 0.39 - Expired
22-May-08 - Interim Trade - STO 3 Jul08 17.50 Call @ 0.16 - Expired
29-May-08 - Dividend Received - DIV 300 Dividend @ 0.08 -
22-Jul-08 - Interim Trade - STO 1 Aug08 12.50 Call @ 0.43 - Closed
22-Jul-08 - Interim Trade - STO 1 Sep08 15.00 Call @ 0.27 - Closed
22-Jul-08 - Interim Trade - STO 1 Nov08 17.50 Call @ 0.33 - Closed
15-Aug-08 - Buy Back and Roll Out - BTC 1 Aug08 12.50 Call @ -0.04 -
15-Aug-08 - Interim Trade - STO 1 Sep08 12.50 Call @ 0.77 - Closed
28-Aug-08 - Dividend Received - DIV 300 Dividend @ 0.08 -
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 15.00 Call @ -0.36 -
12-Sep-08 - Buy Back & Roll Out/Up - BTC 1 Sep08 12.50 Call @ -1.86 -
12-Sep-08 - Interim Trade - STO 1 Oct08 15.00 Call @ 0.84 - Expired
12-Sep-08 - Interim Trade - STO 1 Nov08 15.00 Call @ 1.39 - Closed
20-Oct-08 - Buy Back and Roll Down - BTC 1 Nov08 17.50 Call @ -0.06 -
20-Oct-08 - Buy Back and Roll Down - BTC 1 Nov08 15.00 Call @ -0.06 -
20-Oct-08 - Interim Trade - STO 3 Dec08 10.00 Call @ 0.24 - Expired
18-Dec-08 - Dividend Received - DIV 300 Dividend @ 0.04 -
22-Dec-08 - Interim Trade - STO 3 Feb09 10.00 Call @ 0.44 -

CRI - Adjustment

The following adjustment was made today on CRI:

22-Dec-08 - Continued Trade - STO 2 Jan09 20.00 Call @ 0.76 -

Current Position Summary:

Stock Investment: $4,049.00
Income Generated: $611.20
Percent Income Generated: 15.10%
Annualized Income Generated: 9.55%
Net Profit If Called: $562.20
Percent Return If Called: 13.88%
Annualized Return If Called: 8.78%
Days Held to Expiration: 577 days

Trade History:

19-Jun-07 - Initial Stock Position - BTO 100 CRI @ 26.54 -
19-Jun-07 - Initial Call Option - STO 1 Sep07 25.00 Call @ 2.99 - Expired
24-Sep-07 - Interim Trade - STO 1 Dec07 22.50 Call @ 0.69 - Expired
14-Jan-08 - Interim Trade - STO 1 Mar08 20.00 Call @ 0.49 - Expired
25-Mar-08 - Interim Trade - STO 1 Apr08 17.50 Call @ 0.24 - Expired
24-Apr-08 - Dollar Cost Averaging - BTO 100 CRI @ 13.95 -
24-Apr-08 - Combined Cost Basis - $4,049.00 200 @ 20.25 -
24-Apr-08 - Interim Trade - STO 2 Sep08 17.50 Call @ 0.64 - Closed
12-Sep-08 - Buy Back & Roll Out/Up - BTC 2 Sep08 17.50 Call @ -2.16 -
12-Sep-08 - Continued Trade - STO 2 Dec08 20.00 Call @ 1.60 - Expired
22-Dec-08 - Continued Trade - STO 2 Jan09 20.00 Call @ 0.76 -

CNI - Adjustment

The following adjustment was made today on CNI:

22-Dec-08 - Interim Trade - STO 1 Jan09 40.00 Call @ 0.24 -

Current Position Summary:

Stock Investment: $5,201.00
Income Generated: $511.42
Percent Income Generated: 9.83%
Annualized Income Generated: 31.21%
Net Profit If Called: -$689.58
Percent Return If Called: -13.26%
Annualized Return If Called: -42.08%
Days Held to Expiration: 115 days

Trade History:

23-Sep-08 - Initial Stock Position - BTO 100 CNI @ 52.01 -
23-Sep-08 - Initial Call Option - STO 1 Oct08 50.00 Call @ 3.19 - Expired
30-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.22 -
30-Sep-08 - Withholding Tax - TAX 1 CA Tax @ -0.03 -
20-Oct-08 - Interim Trade - STO 1 Nov08 45.00 Call @ 1.04 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 40.00 Call @ 0.46 - Expired
22-Dec-08 - Interim Trade - STO 1 Jan09 40.00 Call @ 0.24 -

BBT - Adjustment

The following adjustment was made today on BBT:

22-Dec-08 - Continued Trade - STO 2 Jan09 32.50 Call @ 0.19 -

Current Position Summary:

Stock Investment: $6.671.00
Income Generated: $938.60
Percent Income Generated: 14.07%
Annualized Income Generated: 17.29%
Net Profit If Called: $767.60
Percent Return If Called: 11.51%
Annualized Return If Called: 14.14%
Days Held to Expiration: 297 days

Trade History:

25-Mar-08 - Initial Stock Position - BTO 100 BBT @ 35.26 -
25-Mar-08 - Initial Call Option - STO 1 Apr08 35.00 Call @ 1.68 - Expired
23-Apr-08 - Continued Trade - STO 1 May08 35.00 Call @ 0.67 - Expired
01-May-08 - Dividend Received - DIV 100 Dividend @ 0.46 -
19-May-08 - Continued Trade - STO 1 Jun08 35.00 Call @ 1.47 - Expired
07-Jul-08 - Interim Trade - STO 1 Aug08 27.50 Call @ 0.35 - Closed
01-Aug-08 - Dividend Received - DIV 100 Dividend @ 0.47 -
11-Aug-08 - Buy Back and Roll Out/Up - BTC 1 Aug08 27.50 Call @ -4.02 -
11-Aug-08 - Dollar Cost Averaging - BTO 100 BBT @ 31.45 -
11-Aug-08 - Combined Cost Basis - $6,671.00 200 @ 33.36 -
11-Aug-08 - Continued Trade - STO 2 Dec08 32.50 Call @ 3.49 - Expired
03-Nov-08 - Dividend Received - DIV 200 Dividend @ 0.47 -
22-Dec-08 - Continued Trade - STO 2 Jan09 32.50 Call @ 0.19 -

BAC - Adjustment

The following adjustment was made today on BAC:

22-Dec-08 - Interim Trade - STO 1 Jan09 16.00 Call @ 0.47 -

Current Position Summary:

Stock Investment: $3,372.00
Income Generated: $552.00
Percent Income Generated: 16.37%
Annualized Income Generated: 52.41%
Net Profit If Called: -$1,220.00
Percent Return If Called: -36.18%
Annualized Return If Called: -115.84
Days Held to Expiration: 114 days

Trade History:

24-Sep-08 - Initial Stock Position - BTO 100 BAC @ 33.72 -
24-Sep-08 - Initial Call Option - STO 1 Oct08 32.50 Call @ 3.21 - Expired
26-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.64 -
20-Oct-08 - Interim Trade - STO 1 Nov08 27.50 Call @ 0.73 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 17.50Call @ 0.47 - Expired
22-Dec-08 - Interim Trade - STO 1 Jan09 16.00 Call @ 0.47 -

AXP - Adjustment

The following adjustment was made today on AXP:

22-Dec-08 - Interim Trade - STO 2 Jan09 22.50 Call @ 0.31 -

Current Position Summary:

Stock Investment: $9,400.00
Income Generated: $1,796.40
Percent Income Generated: 19.11%
Annualized Income Generated: 16.81%
Net Profit If Called: -$3,103.60
Percent Return If Called: -33.02%
Annualized Return If Called: -29.04%
Days Held to Expiration: 415 days

Trade History:

28-Nov-07 - Initial Stock Position - BTO 100 AXP @ 56.74 -
28-Nov-07 - Initial Call Option - STO 1 Dec07 55.00 Call @ 3.21 - Expired
07-Jan-08 - Continued Trade - STO 1 Feb08 55.00 Call @ 0.69 - Expired
08-Feb-08 - Dividend Received - DIV 100 Dividend @ 0.18 -
21-Feb-08 - Interim Trade - STO 1 Apr08 50.00 Call @ 0.89 - Expired
25-Apr-08 - Interim Trade - STO 1 May08 50.00 Call @ 0.30 - Expired
09-May-08 - Dividend Received - DIV 100 Dividend @ 0.18 -
19-May-08 - Interim Trade - STO 1 Jul08 50.00 Call @ 2.65 - Expired
23-Jul-08 - Interim Trade - STO 1 Aug08 42.50 Call @ 0.60 - Expired
08-Aug-08 - Dividend Received - DIV 100 Dividend @ 0.18 -
22-Aug-08 - Interim Trade - STO 1 Sep08 42.50 Call @ 0.28 - Closed
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 42.50 Call @ -0.16 -
12-Sep-08 - Interim Trade - STO 1 Oct08 42.50 Call @ 0.79 - Expired
23-Sep-08 - Second Stock Position - BTO 100 AXP @ 37.26 -
23-Sep-08 - Combined Cost Basis - $9,400.00 200 @ 47.00 -
23-Sep-08 - Initial Call Option - STO 1 Oct08 35.00 Call @ 3.67 - Expired
20-Oct-08 - Interim Trade - STO 2 Nov08 27.50 Call @ 1.22 - Expired
10-Nov-08 - Dividend Received - DIV 200 Dividend @ 0.18 -
24-Nov-08 - Interim Trade - STO 2 Dec08 25.00 Call @ 0.54 - Expired
22-Dec-08 - Interim Trade - STO 2 Jan09 22.50 Call @ 0.31 -

ADP - Adjustment

The following adjustment was made today on ADP:

22-Dec-08 - Continued Trade - STO 1 Feb09 42.50 Call @ 0.91 -

Current Position Summary:

Stock Investment: $4,308.00
Income Generated: $396.00
Percent Income Generated: 9.19%
Annualized Income Generated: 22.37%
Net Profit If Called: $338.00
Percent Return If Called: 7.85%
Annualized Return If Called: 19.09%
Days Held to Expiration: 150 days

Trade History:

23-Sep-08 - Initial Stock Position - BTO 100 ADP @ 43.08 -
23-Sep-08 - Initial Call Option - STO 1 Oct08 42.50 Call @ 1.75 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 37.50 Call @ 0.84 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 40.00 Call @ 0.46 - Expired
22-Dec-08 - Continued Trade - STO 1 Feb09 42.50 Call @ 0.91 -

TLT - Closed

The TLT position was called away for a profit today. The following is the trade history and returns, including IB commissions.

Covered Call Results

Stock Investment: $11,071.00
Income Generated: $209.00
Net Profit: $238.00
Percent Return: 2.15%
Annualized Return: 112.09%
Duration of Trade: 7 days

Trade History:

09-Dec-08 - Initial Stock Position - BTO 100 TLT @ 110.71 -
09-Dec-08 - Initial Call Option - STO 1 Dec08 111.00 Call @ 2.09 - Exercised
16-Dec-08 - Option Exercised - EX 1 Dec08 111.00 Call @ 111.00 -

TIP - Closed

The TIP Dec08 96.00 call was exercised on Fri and the stock was called away for a profit. The following is the trade history and returns, including IB commissions.

Covered Call Results

Stock Investment: $9,509.00
Income Generated: $79.00
Net Profit: $170.00
Percent Return: 1.79%
Annualized Return: 14.83%
Duration of Trade: 44 days

Trade History:

05-Nov-08 - Initial Stock Position - BTO 100 TIP @ 95.09 -
05-Nov-08 - Initial Call Option - STO 1 Dec08 96.00 Call @ 0.79 - Exercised
19-Dec-08 - Option Exercised - EX 1 Dec08 96.00 Call @ 96.00 -

PG - Closed

The PG Dec08 60.00 call was exercised on Fri and the stock was called away for a profit. The following is the trade history and returns, including IB commissions.

Covered Call Results

Stock Investment: $6,348.00
Income Generated: $549.00
Net Profit: $201.00
Percent Return: 3.17%
Annualized Return: 46.23%
Duration of Trade: 25 days

Trade History:

24-Nov-08 - Initial Stock Position - BTO 100 PG @ 63.48 -
24-Nov-08 - Initial Call Option - STO 1 Dec08 60.00 Call @ 5.49 - Exercised
19-Dec-08 - Option Exercised - EX 1 Dec08 60.00 Call @ 60.00 -

CL - Closed

The CL Dec08 60.00 call was exercised on Fri and the stock was called away for a profit. The following is the trade history and returns, including IB commissions.

Covered Call Results

Stock Investment: $6,362.00
Income Generated: $519.00
Net Profit: $157.00
Percent Return: 2.47%
Annualized Return: 36.03%
Duration of Trade: 25 days

Trade History:

24-Nov-08 - Initial Stock Position - BTO 100 CL @ 63.62 -
24-Nov-08 - Initial Call Option - STO 1 Dec08 60.00 Call @ 5.19 - Exercised
19-Dec-08 - Option Exercised - EX 1 Dec08 60.00 Call @ 60.00 -

LM - Adjustment

The following adjustment was made today on LM:

18-Dec-08 - Buy Back & Roll Out - BTC 1 Dec08 20.00 Call @ -1.51 -
18-Dec-08 - Interim Trade - STO 1 Feb09 25.00 Call @ 2.14 -

Current Position Summary:

Stock Investment: $9,109.00
Income Generated: $1,805.00
Percent Income Generated: 19.82%
Annualized Income Generated: 12.60%
Net Profit If Called: -$4,804.00
Percent Return If Called: -52.74%
Annualized Return If Called: -33.54%
Days Held to Expiration: 574 days

Trade History:

27-Jul-07 - Initial Stock Position - BTO 100 LM @ 91.09 -
27-Jul-07 - Initial Call Option - STO 1 Aug07 90.00 Call @ 3.49 - Expired
20-Aug-07 - Continued Trade - STO 1 Sep07 90.00 Call @ 2.09 - Expired
24-Sep-07 - Continued Trade - STO 1 Oct07 90.00 Call @ 0.47 - Expired
15-Oct-07 - Dividend Received - DIV 100 Dividend @ 0.24 -
25-Oct-07 - Continued Trade - STO 1 Dec07 85.00 Call @ 2.09 - Expired
31-Dec-07 - Dividend Received - DIV 100 Dividend @ 0.24 -
07-Jan-08 - Interim Trade - STO 1 Feb08 80.00 Call @ 0.97 - Expired
21-Feb-08 - Interim Trade - STO 1 Mar08 75.00 Call @ 0.64 - Expired
25-Mar-08 - Interim Trade - STO 1 Apr08 65.00 Call @ 0.68 - Expired
07-Apr-08 - Dividend Received - DIV 100 Dividend @ 0.24 -
23-Apr-08 - Interim Trade - STO 1 May08 65.00 Call @ 0.39 - Expired
22-May-08 - Interim Trade - STO 1 Jul08 60.00 Call @ 0.82 - Expired
07-Jul-08 - Dividend Received - DIV 100 Dividend @ 0.24 -
29-Jul-08 - Interim Trade - STO 1 Sep08 45.00 Call @ 1.40 - Closed
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 45.00 Call @ -0.40 -
12-Sep-08 - Interim Trade - STO 1 Oct08 45.00 Call @ 1.50 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 25.00 Call @ 1.59 - Expired
20-Oct-08 - Dividend Received - DIV 100 Dividend @ 0.24 -
24-Nov-08 - Interim Trade - STO 1 Dec08 20.00 Call @ 0.49 - Closed
18-Dec-08 - Buy Back & Roll Out - BTC 1 Dec08 20.00 Call @ -1.51 -
18-Dec-08 - Interim Trade - STO 1 Feb09 25.00 Call @ 2.14 -

TLT - Closed

The TLT position was called away for a profit today. The following is the trade history and returns, including IB commissions.

Covered Call Results

Stock Investment: $11,071.00
Income Generated: $209.00
Net Profit: $238.00
Percent Return: 2.15%
Annualized Return: 112.09%
Duration of Trade: 7 days

Trade History:

09-Dec-08 - Initial Stock Position - BTO 100 TLT @ 110.71 -
09-Dec-08 - Initial Call Option - STO 1 Dec08 111.00 Call @ 2.09 - Exercised
16-Dec-08 - Option Exercised - EX 1 Dec08 111.00 Call @ 111.00 -

Rolling Up vs Closing and Re-entering

Last week I closed a TLT Dec 103 position early and established a new TLT Dec 111 position. A comment was posted asking why I didn't just roll the position up to the Dec 111 strike instead. I responded to the comment but thought this would make a good article.

By closing the TLT Dec 103 position I realized a gain of $273.50. Establishing a new Dec 111 position brought in another $209.00 of income with the potential profit of $238.00 if called and a combined total profit of $511.50. However, if not called, I would still have the realized profit from the Dec 103 position of $273.50, and the $209.00 of income generated by the Dec 111 position, for a combined profit of $482.50.

If I rolled the position instead, I would have had to buy back the Dec 103 call, at a loss, and sell the Dec 111 call for a total net debit of $392.50 with the potential profit of $515.50 if called. However, if not called, I would have a loss of $392.50.

So, by closing the Dec 103 and establishing a new Dec 111 position, I sacrificed $4.00 in profit if TLT closes above $111 but locked in a realized gain of $273.50, and would still end up with $482.50 if TLT closes below $111, rather than a loss of $392.50 had I rolled.

As it turns out, TLT is looks like it will close above $111, so rolling would have provided $4 more profit than closing and re-entering. If I could predict the future, rolling would have been the better option (no pun intended). However, since I can't predict the future, I'd rather take a sure gain by closing the existing position, and then re-entering to get a better return if not called. TLT could have just as easily gone down, in which case rolling would have generated a loss.

BHP - Adjustment

The following adjustment was made today on BHP:

15-Dec-08 - Buy Back and Roll Out/Up - BTC 2 Dec08 37.50 Call @ -4.41 -
15-Dec-08 - Interim Trade - STO 2 May09 45.00 Call @ 6.39 -

The BHP Dec08 37.50 call was ITM with about $0.20 time value left, so I rolled it out/up to a May09 45 call for a net credit to avoid assignment.

Current Position Summary:

Stock Investment: $12,754.00
Income Generated: $2,172.40
Percent Income Generated: 17.03%
Annualized Income Generated: 23.03%
Net Profit If Called: -$1,581.60
Percent Return If Called: -12.40%
Annualized Return If Called: -16.76%
Days Held to Expiration: 270 days

Trade History:

18-Aug-08 - Initial Stock Position - BTO 100 BHP @ 65.11 -
18-Aug-08 - Initial Call Option - STO 1 Sep08 65.00 Call @ 3.00 - Expired
22-Sep-08 - Continued Trade - STO 1 Oct08 65.00 Call @ 3.30 - Expired
23-Sep-08 - Second Stock Position - BTO 100 BHP @ 62.43 -
23-Sep-08 - Combined Cost Basis - $12,754.00 200 @ 63.77 -
23-Sep-08 - Initial Call Option - STO 1 Oct08 60.00 Call @ 5.10 - Expired
25-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.82 -
20-Oct-08 - Interim Trade - STO 2 Nov08 45.00 Call @ 1.19 - Expired
24-Nov-08 - Interim Trade - STO 2 Dec08 37.50 Call @ 1.57 - Closed
15-Dec-08 - Buy Back and Roll Out/Up - BTC 2 Dec08 37.50 Call @ -4.41 -
15-Dec-08 - Interim Trade - STO 2 May09 45.00 Call @ 6.39 -

SNDK - Adjustment

The following adjustments were made today on SNDK:

11-Dec-08 - Buy Back and Roll Out/Up - BTC 2 Dec08 8.00 Call @ -2.01 -
11-Dec-08 - Interim Trade - STO 2 Jan09 11.00 Call @ 1.13 -

The SNDK Dec08 8 call was ITM with less than $.10 time value so I rolled it out to a Jan09 11 call for a net debit. I usually try to get a net credit but I would have had to go out to Apr09 to get it and I didn't want to go out that far. I could have averaged down, but I don't want to invest any more money in SNDK at this time. So I gave back at $180 of income.

Current Position Summary:

Stock Investment: $10,854.00
Income Generated: $3,813.20
Percent Income Generated: 35.13%
Annualized Income Generated: 12.85%
Net Profit If Called: -$4,840.80
Percent Return If Called: -44.60%
Annualized Return If Called: -16.31%
Days Held to Expiration: 998 days

Trade History:

24-Apr-06 - Initial Stock Position - BTO 100 SNDK @ 59.56 -
24-Apr-06 - Initial Call Option - STO 1 Jul06 57.50 Call @ 7.09 - Closed
06-Jul-06 - Buy Back & Roll Out/Down - BTC 1 Jul06 57.50 Call @ -0.16 -
06-Jul-06 - Second Stock Position - BTO 100 SNDK @ 48.98 -
06-Jul-06 - Combined Cost Basis - $10,854.00 200 @ 54.27 -
06-Jul-06 - Continued Trade - STO 2 Oct06 55.00 Call @ 3.39 - Expired
23-Oct-06 - Continued Trade - STO 2 Jan07 55.00 Call @ 2.14 - Closed
19-Dec-06 - Buy Back & Roll Out/Down - BTC 2 Jan07 55.00 Call @ -0.16 -
19-Dec-06 - Continued Trade - STO 2 Feb07 50.00 Call @ 1.69 - Closed
06-Feb-07 - Buy Back & Roll Out/Down - BTC 2 Feb07 50.00 Call @ -0.06 -
06-Feb-07 - Interim Trade - STO 2 Apr07 45.00 Call @ 1.39 - Expired
27-Apr-07 - Interim Trade - STO 2 May07 45.00 Call @ 0.84 - Expired
21-May-07 - Interim Trade - STO 2 Jun07 45.00 Call @ 0.98 - Closed
15-Jun-07 - Buy Back & Roll Out/Up - BTC 2 Jun07 45.00 Call @ -1.46 -
15-Jun-07 - Continued Trade - STO 2 Oct07 50.00 Call @ 2.60 - Expired
22-Oct-07 - Continued Trade - STO 2 Nov07 45.00 Call @ 1.64 - Expired
20-Nov-07 - Continued Trade - STO 2 Dec07 40.00 Call @ 0.67 - Expired
14-Jan-08 - Interim Trade - STO 2 Feb08 35.00 Call @ 0.85 - Expired
21-Feb-08 - Interim Trade - STO 2 Mar08 30.00 Call @ 0.24 - Expired
25-Mar-08 - Interim Trade - STO 2 May08 25.00 Call @ 0.74 - Expired
29-Apr-08 - Buy Back & Roll Out/Up - BTC 2 May08 25.00 Call @ -2.35 -
29-Apr-08 - Interim Trade - STO 2 Jul08 30.00 Call @ 1.38 - Expired
24-Jul-08 - Interim Trade - STO 1 Oct08 20.00 Call @ 0.31 - Expired
24-Jul-08 - Interim Trade - STO 1 Oct08 17.50 Call @ 0.65 - Expired
20-Oct-08 - Interim Trade - STO 2 Nov08 18.00 Call @ 1.16 - Expired
24-Nov-08 - Interim Trade - STO 2 Dec08 8.00 Call @ 0.27 - Closed
11-Dec-08 - Buy Back and Roll Out/Up - BTC 2 Dec08 8.00 Call @ -2.01 -
11-Dec-08 - Interim Trade - STO 2 Jan09 11.00 Call @ 1.13 -

PFCB - Adjustment

The following adjustment was made today on PFCB:

10-Dec-08 - Buy Back and Roll Out/Up - BTC 1 Dec08 20.00 Call @ -3.11 -
10-Dec-08 - Second Stock Position - BTO 100 PFCB @ 22.73 -
10-Dec-08 - Combined Cost Basis - $5,851.00 200 @ 29.26 -
10-Dec-08 - Interim Trade - STO 2 Apr09 25.00 Call @ 2.89 -

The PFCB Dec09 20.00 call was ITM with less than $0.10 time value left so I averaged down and rolled out/up to an Apr09 25.00 call. I avoided a $900+ loss and am now looking at a possible $60+ dollar gain if it's called in Apr. However, I'll most likely roll it again if it goes up above $25 in Apr.

Current Position Summary:

Stock Investment: $5,851.00
Income Generated: $914.60
Percent Income Generated: 15.63%
Annualized Income Generated: 9.42%
Net Profit If Called: $63.60
Percent Return If Called: 1.09%
Annualized Return If Called: 0.65%
Days Held to Expiration: 606 days

Trade History:

20-Aug-07 - Initial Stock Position - BTO 100 PFCB @ 35.78 -
20-Aug-07 - Initial Call Option - STO 1 Sep07 35.00 Call @ 2.30 - Expired
24-Sep-07 - Continued Trade - STO 1 Oct07 35.00 Call @ 0.39 - Expired
25-Oct-07 - Continued Trade - STO 1 Jan08 35.00 Call @ 0.22 - Expired
24-Jan-08 - Interim Trade - STO 1 Feb08 30.00 Call @ 0.65 - Expired
21-Feb-08 - Interim Trade - STO 1 Mar08 30.00 Call @ 0.74 - Expired
25-Mar-08 - Continued Trade - STO 1 Apr08 35.00 Call @ 0.34 - Expired
24-Apr-08 - Continued Trade - STO 1 Jun08 35.00 Call @ 0.49 - Expired
24-Jul-08 - Interim Trade - STO 1 Sep08 30.00 Call @ 0.63 - Closed
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 30.00 Call @ -0.06 -
12-Sep-08 - Interim Trade - STO 1 Oct08 30.00 Call @ 0.09 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 22.50 Call @ 0.34 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 22.50 Call @ 0.34 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 20.00 Call @ 0.34 - Closed
10-Dec-08 - Buy Back and Roll Out/Up - BTC 1 Dec08 20.00 Call @ -3.11 -
10-Dec-08 - Second Stock Position - BTO 100 PFCB @ 22.73 -
10-Dec-08 - Combined Cost Basis - $5,851.00 200 @ 29.26 -
10-Dec-08 - Interim Trade - STO 2 Apr09 25.00 Call @ 2.89 -

TLT - New Position

A new position was established today on TLT. The following is the trade information, including IB commissions:

09-Dec-08 - Initial Stock Position - BTO 100 TLT @ 110.71
09-Dec-08 - Initial Call Option - STO 1 Dec08 111.00 Call @ 2.09

Stock Investment: $11,071.00
Income Generated: $209.00
Percent Income Generated: 1.89%
Annualized Income Generated: 68.91%
Net Profit If Called: $238.00
Percent Return If Called: 2.15%
Annualized Return If Called: 78.47%
Days Held to Expiration: 10 days

TLT - Closed

The TLT position was closed today for a profit since it already produced about 80% of the expected return. By closing early I gave back $64 in profit but increased the annualized return. I was also able to establish a new position in TLT for Dec expiration which brought in an additional $200 for the month. So the net gain from this move is about $136.00.

The following is the trade history and returns, including IB commissions.

Covered Call Results

Stock Investment: $10,192.00
Income Generated: $229.50
Net Profit: $273.50
Percent Return: 2.68%
Annualized Return: 65.30%
Duration of Trade: 15 days

Trade History:

24-Nov-08 - Initial Stock Position - BTO 100 TLT @ 101.92 - Closed
24-Nov-08 - Initial Call Option - STO 1 Dec08 103.00 Call @ 1.94 - Closed
05-Dec-08 - Dividend Received - DIV 100 Dividend @ 0.36 -
09-Dec-08 - Closed Call Option - BTC 1 Dec08 103.00 Call @ -8.31 -
09-Dec-08 - Closed Stock Position - STC 1 @ 110.67 -

VMC - Adjustment

The following adjustment was made today on VMC:

09-Dec-08 - Buy Back and Roll Out/Up - BTC 1 Dec08 55.00 Call @ -21.41 -
09-Dec-08 - Second Stock Position - BTO 100 VMC @ 76.11 -
09-Dec-08 - Combined Cost Basis - $16,005.00 200 @ 80.03 -
09-Dec-08 - Continued Trade - STO 2 May09 80.00 Call @ 10.31 -

The VMC Dec 55 Call was DITM with little to no time value left so I had to roll it out and up this morning. I let this one get away from me and should have rolled it a lot sooner. It was almost 4 strikes ITM and was in danger of early exercise, which would have resulted in a $2,000+ loss. Being that far ITM I had to average down and buy an additional 100 shares, which allowed me to sell two calls instead of one, but even that didn't help to get a net credit. I ended up with a net debit of about $78 and had to go all the way out to a May09 80 call. However, I avoided a $2,000+ loss and am now looking at a possible $700+ dollar gain if it's called in May, plus I'll also receive about $200 in dividends through May09, bringing the potential gain to about $900.

When an Interim Trade goes up too far, as in this case, the emphasis is more on making a defensive move to avoid the loss than trying to generate income. It's very difficult to generate 1%/month in cases like this. By May09 expiration, this position would have been held for about 1 year. If called it would produce an annualized return of 4.69%, which is well below my goal of 12%, but better than money market rates. Not ideal, but not bad either.

Current Position Summary:

Stock Investment: $16,005.00
Income Generated: $742.60
Percent Income Generated: 4.64%
Annualized Income Generated: 4.69%
Net Profit If Called: $737.60
Percent Return If Called: 4.61%
Annualized Return If Called: 4.66%
Days Held to Expiration: 361 days

Trade History:

19-May-08 - Initial Stock Position - BTO 100 VMC @ 83.94 -
19-May-08 - Initial Call Option - STO 1 Jun08 85.00 Call @ 3.09 - Expired
10-Jun-08 - Dividend Received - DIV 100 Dividend @ 0.49 -
07-Jul-08 - Interim Trade - STO 1 Aug08 65.00 Call @ 0.85 - Closed
14-Aug-08 - Buy Back and Roll Out/Up - BTC 1 Aug08 65.00 Call @ -4.50 -
13-Aug-08 - Interim Trade - STO 1 Nov08 70.00 Call @ 6.80 - Expired
10-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.49 -
24-Nov-08 - Interim Trade - STO 1 Dec08 55.00 Call @ 0.99 - Closed
09-Dec-08 - Buy Back and Roll Out/Up - BTC 1 Dec08 55.00 Call @ -21.41 -
09-Dec-08 - Second Stock Position - BTO 100 VMC @ 76.11 -
09-Dec-08 - Combined Cost Basis - $16,005.00 200 @ 80.03 -
09-Dec-08 - Continued Trade - STO 2 May09 80.00 Call @ 10.31 -

Hold or Sell?

There's a discussion going on in our Just Covered Calls Yahoo group about the pros and cons of holding a position that has declined in value vs selling at a loss and moving on to establish a new position.

Let me explain my views on this by using Ben Graham's concept of Mr. Market.

Let's say you own a private company that is fundamentally sound and produces enough free cash flow, after expenses, every year, which provides sufficient income for you to live comfortably.

Enter Mr. Market, a manic depressive who suffers from extreme highs and extreme lows. Each day, he comes to your office and offers to buy your company. On his extreme high days, he's feeling very optimistic and offers to buy your company at a very high price. On his extreme low days, he's feeling very pessimistic and offers to buy your company at a very low price.

Now, obviously, if he's offering a very high price, especially one that compensates you for the companys future cash flow potential, you might accept his offer. However, if he offers you a very low price, what would you do? Would you sell at a loss and start a new company? Or would you reject his offer, knowing that your company will still provide you with sufficient income? I bet you'll probably reject his low offer. Since the company is meeting your income requirements, this provides you the luxury of holding out for a better price.

Investing in stocks, using an income model (see previous article), is no different, since stock represents partial ownership in a company.

The Capital Appreciation Model vs The Income Model

Update 12/21/08: Kim Snider just published an excellent report titled How to not just survive, but thrive, in turbulent financial markets,which describes the difference between the capital appreciation model and the income model, or what she terms the cash flow solution. I highly recommend that you download this report as she does a much better job of making the case than I do.

The goal of the capital appreciation model requires that the price of the assets you purchase rise in value over time. The goal of the income model does not. It only requires a steady, and potentially rising, stream of income from the assets you purchase.

Let's say there are two investors, Investor A, who uses the capital appreciation model, and Investor B, who uses the income model. And there are two stocks, ABC, which pays no dividends, and DEF, which pays a 5% annual dividend. The current stock price for both stocks is $50.

Investor A buys 100 shares of ABC at $50. If, at the end of a year, the price of ABC is $52.50, Investor A can sell the stock and realize a 5% annual gain. However, if the price of ABC is $50 or less, then Investor A has no realized gain for the year. Investor A needs the price of ABC to rise in order to realize a profit for the year.

Investor B buys 100 shares of DEF at $50. By the end of a year, Investor B receives $250 in dividends and realizes a 5% annual gain, regardless of the price of DEF. Investor B doesn't need the price of DEF to rise in order to realize a profit for the year, since the profit is provided by the income stream.

These are completely different strategies and you can't measure one by the goals of the other.

My covered call strategy is a modified dividend income strategy, similar to Investor B, but enhanced by selling covered calls. The market value of the stocks in my portfolio is less important than the income they produce. That income is reinvested, thereby compounding the returns, until such time as the income is needed. As long as the actual income from this portfolio meets or exceeds the projected income, its meeting its objectives, regardless of the current market value at any point in time.

Here's an good article titled "Seven Important Reasons for Dividend Investing", which provides the benefits of using an income strategy.

By combining dividend investing with a covered call strategy you can produce a fairly stable income stream.

TLT - New Position

A new position was established today on TLT. The following is the trade information, including IB commissions:

24-Nov-08 - Initial Stock Position - BTO 100 TLT @ 101.92
24-Nov-08 - Initial Call Option - STO 1 Dec08 103.00 Call @ 1.94

Stock Investment: $10.192.00
Income Generated: $194.00
Percent Income Generated: 1.90%
Annualized Income Generated: 27.79%
Net Profit If Called: $302.00
Percent Return If Called: 2.96%
Annualized Return If Called: 43.26%
Days Held to Expiration: 25 days

PG - New Position

A new position was established today on PG. The following is the trade information, including IB commissions:

24-Nov-08 - Initial Stock Position - BTO 100 PG @ 63.48
24-Nov-08 - Initial Call Option - STO 1 Dec08 60.00 Call @ 5.49

Stock Investment: $6,348.00
Income Generated: $549.00
Percent Income Generated: 8.65%
Annualized Income Generated: 126.27
Net Profit If Called: $201.00
Percent Return If Called: 3.17%
Annualized Return If Called: 46.23%
Days Held to Expiration: 25 days

CL - New Position

A new position was established today on CL. The following is the trade information, including IB commissions:

24-Nov-08 - Initial Stock Position - BTO 100 CL @ 63.62
24-Nov-08 - Initial Call Option - STO 1 Dec08 60.00 Call @ 5.19

Stock Investment: $6,362.00
Income Generated: $519.00
Percent Income Generated: 8.16%
Annualized Income Generated: 119.10%
Net Profit If Called: $157.00
Percent Return If Called: 2.47%
Annualized Return If Called: 36.03%
Days Held to Expiration: 25 days

WFMI - Adjustment

The following adjustment was made today on WFMI:

24-Nov-08 - Interim Trade - STO 2 Jan09 11.00 Call @ 0.27 -

Current Position Summary:

Stock Investment: $8,563.00
Income Generated: $1,855.40
Percent Income Generated: 21.67%
Annualized Income Generated: 12.47%
Net Profit If Called: -$4,507.60
Percent Return If Called: -52.64%
Annualized Return If Called: -30.31%
Days Held to Expiration: 634 days

Trade History:

23-Apr-07 - Initial Stock Position - BTO 100 WFMI @ 47.19 - VICC
23-Apr-07 - Initial Call Option - STO 1 May07 50.00 Call @ 0.83 - Expired
21-May-07 - Interim Trade - STO 1 Jul07 45.00 Call @ 0.24 - Closed
21-Jun-07 - Buy Back and Roll Out - BTC 1 Jul07 45.00 Call @ -0.03 -
21-Jun-07 - Dollar Cost Averaging - BTO 100 WFMI @ 38.44 -
21-Jun-07 - Combined Cost Basis - $8,563.00 200 @ 42.82 -
21-Jun-07 - Continued Trade - STO 2 Aug07 45.00 Call @ 0.29 - Expired
24-Jul-07 - Dividend Received - DIV 200 Dividend @ 0.18 -
20-Aug-07 - Continued Trade - STO 2 Sep07 50.00 Call @ 0.20 - Expired
24-Sep-07 - Continued Trade - STO 2 Oct07 50.00 Call @ 0.16 - Expired
22-Oct-07 - Continued Trade - STO 2 Dec07 50.00 Call @ 2.64 - Expired
14-Jan-08 - Continued Trade - STO 2 May08 45.00 Call @ 1.45 - Closed
22-Jan-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
22-Apr-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
28-Apr-08 - Buy Back & Roll Down - BTC 2 May08 45.00 Call @ -0.06 -
28-Apr-08 - Interim Trade - STO 2 May08 34.00 Call @ 0.53 - Expired
22-May-08 - Interim Trade - STO 2 Jul08 31.00 Call @ 0.54 - Expired
22-Jul-08 - Interim Trade - STO 2 Aug08 24.00 Call @ 0.89 - Expired
22-Aug-08 - Interim Trade - STO 2 Oct08 21.00 Call @ 0.43 - Expired
20-Oct-08 - Interim Trade - STO 2 Nov08 17.00 Call @ 0.44 - Expired
24-Nov-08 - Interim Trade - STO 2 Jan09 11.00 Call @ 0.27 -

VMC - Adjustment

The following adjustment was made today on VMC:

24-Nov-08 - Interim Trade - STO 1 Dec08 55.00 Call @ 0.99 -

Current Position Summary:

Stock Investment: $8,394.00
Income Generated: $821.00
Percent Income Generated: 9.78%
Annualized Income Generated: 16.68%
Net Profit If Called: -$2,073.00
Percent Return If Called: -24.70%
Annualized Return If Called: -42.12%
Days Held to Expiration: 214 days

Trade History:

19-May-08 - Initial Stock Position - BTO 100 VMC @ 83.94 -
19-May-08 - Initial Call Option - STO 1 Jun08 85.00 Call @ 3.09 - Expired
10-Jun-08 - Dividend Received - DIV 100 Dividend @ 0.49 -
07-Jul-08 - Interim Trade - STO 1 Aug08 65.00 Call @ 0.85 - Closed
14-Aug-08 - Buy Back and Roll Out/Up - BTC 1 Aug08 65.00 Call @ -4.50 -
13-Aug-08 - Interim Trade - STO 1 Nov08 70.00 Call @ 6.80 - Expired
10-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.49 -
24-Nov-08 - Interim Trade - STO 1 Dec08 55.00 Call @ 0.99 -

UTX - Adjustment

The following adjustment was made today on UTX:

24-Nov-08 - Interim Trade - STO 1 Dec08 55.00 Call @ 0.79 -

Current Position Summary:

Stock Investment: $7,524.00
Income Generated: $543.00
Percent Income Generated: 7.22%
Annualized Income Generated: 11.40%
Net Profit If Called: -$1,481.00
Percent Return If Called: -19.68%
Annualized Return If Called: -31.10%
Days Held to Expiration: 231 days

Trade History:

02-May-08 - Initial Stock Position - BTO 100 UTX @ 75.24 -
02-May-08 - Initial Call Option - STO 1 Jun08 75.00 Call @ 2.37 - Expired
10-Jun-08 - Dividend Received - DIV 100 Dividend @ 0.32 -
07-Jul-08 - Interim Trade - STO 1 Aug08 70.00 Call @ 0.26 - Expired
22-Aug-08 - Interim Trade - STO 1 Sep08 70.00 Call @ 0.35 - Closed
10-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.32 -
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 70.00 Call @ -0.06 -
12-Sep-08 - Interim Trade - STO 1 Oct08 70.00 Call @ 0.69 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 60.00 Call @ 0.39 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 55.00 Call @ 0.79 -

TIP - Adjustment

The following adjustment was made today on TIP:

24-Nov-08 - Interim Trade - STO 1 Jan09 93.00 Call @ 0.29 -

Current Position Summary:

Stock Investment: $9,724.00
Income Generated: $113.00
Percent Income Generated: 1.16%
Annualized Income Generated: 4.99%
Net Profit If Called: -$311.00
Percent Return If Called: -3.20%
Annualized Return If Called: -13.73%
Days Held to Expiration: 85 days

Trade History:

23-Oct-08 - Initial Stock Position - BTO 100 TIP @ 97.24 -
23-Oct-08 - Initial Call Option - STO 1 Nov08 98.00 Call @ 0.84 - Expired
24-Nov-08 - Interim Trade - STO 1 Jan09 93.00 Call @ 0.29 -

TGT - Adjustment

The following adjustment was made today on TGT:

24-Nov-08 - Interim Trade - STO 1 Dec08 35.00 Call @ 1.39 -

Current Position Summary:

Stock Investment: $5,937.00
Income Generated: $1,163.90
Percent Income Generated: 19.60%
Annualized Income Generated: 18.49%
Net Profit If Called: -$1,273.10
Percent Return If Called: -21.44
Annualized Return If Called: -20.22%
Days Held to Expiration: 387 days

Trade History:

28-Nov-07 - Initial Stock Position - BTO 100 TGT @ 59.37 -
28-Nov-07 - Initial Call Option - STO 1 Dec07 55.00 Call @ 5.66 - Expired
07-Jan-08 - Continued Trade - STO 1 Feb07 55.00 Call @ 0.84 - Expired
21-Feb-08 - Continued Trade - STO 1 Mar08 55.00 Call @ 1.44 - Expired
10-Mar-08 - Dividend Received - DIV 100 Dividend @ 0.14 -
25-Mar-08 - Continued Trade - STO 1 Apr08 55.00 Call @ 1.31 - Expired
23-Apr-08 - Interim Trade - STO 1 May08 55.00 Call @ 0.62 - Closed
16-May-08 - Buy Back & Roll Out/Up - BTC 1 May08 55.00 Call @ -0.11 -
19-May-08 - Continued Trade - STO 1 Jun08 57.50 Call @ 1.21 - Expired
10-Jun-08 - Dividend Received - DIV 100 Dividend @ 0.14 -
07-Jul-08 - Continued Trade - STO 1 Jul08 50.00 Call @ 0.58 - Expired
22-Jul-08 - Continued Trade - STO 1 Sep08 50.00 Call @ 1.25 - Closed
10-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.16 -
12-Sep-08 - Buy Back & Roll Out/Up - BTC 1 Sep08 50.00 Call @ -6.80 -
12-Sep-08 - Continued Trade - STO 1 Oct08 57.50 Call @ 2.62 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 45.00 Call @ 1.18 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 35.00 Call @ 1.39 -

SNDK - Adjustment

The following adjustments were made today on SNDK:

24-Nov-08 - Interim Trade - STO 2 Dec08 8.00 Call @ 0.27 -

Current Position Summary:

Stock Investment: $10,854.00
Income Generated: $3,988.00
Percent Income Generated: 36.74%
Annualized Income Generated: 13.44%
Net Profit If Called: -$5,266.00
Percent Return If Called: -48.52%
Annualized Return If Called: -18.26%
Days Held to Expiration: 970 days

Trade History:

24-Apr-06 - Initial Stock Position - BTO 100 SNDK @ 59.56 -
24-Apr-06 - Initial Call Option - STO 1 Jul06 57.50 Call @ 7.09 - Closed
06-Jul-06 - Buy Back & Roll Out/Down - BTC 1 Jul06 57.50 Call @ -0.16 -
06-Jul-06 - Second Stock Position - BTO 100 SNDK @ 48.98 -
06-Jul-06 - Combined Cost Basis - $10,854.00 200 @ 54.27 -
06-Jul-06 - Continued Trade - STO 2 Oct06 55.00 Call @ 3.39 - Expired
23-Oct-06 - Continued Trade - STO 2 Jan07 55.00 Call @ 2.14 - Closed
19-Dec-06 - Buy Back & Roll Out/Down - BTC 2 Jan07 55.00 Call @ -0.16 -
19-Dec-06 - Continued Trade - STO 2 Feb07 50.00 Call @ 1.69 - Closed
06-Feb-07 - Buy Back & Roll Out/Down - BTC 2 Feb07 50.00 Call @ -0.06 -
06-Feb-07 - Interim Trade - STO 2 Apr07 45.00 Call @ 1.39 - Expired
27-Apr-07 - Interim Trade - STO 2 May07 45.00 Call @ 0.84 - Expired
21-May-07 - Interim Trade - STO 2 Jun07 45.00 Call @ 0.98 - Closed
15-Jun-07 - Buy Back & Roll Out/Up - BTC 2 Jun07 45.00 Call @ -1.46 -
15-Jun-07 - Continued Trade - STO 2 Oct07 50.00 Call @ 2.60 - Expired
22-Oct-07 - Continued Trade - STO 2 Nov07 45.00 Call @ 1.64 - Expired
20-Nov-07 - Continued Trade - STO 2 Dec07 40.00 Call @ 0.67 - Expired
14-Jan-08 - Interim Trade - STO 2 Feb08 35.00 Call @ 0.85 - Expired
21-Feb-08 - Interim Trade - STO 2 Mar08 30.00 Call @ 0.24 - Expired
25-Mar-08 - Interim Trade - STO 2 May08 25.00 Call @ 0.74 - Expired
29-Apr-08 - Buy Back & Roll Out/Up - BTC 2 May08 25.00 Call @ -2.35 -
29-Apr-08 - Interim Trade - STO 2 Jul08 30.00 Call @ 1.38 - Expired
24-Jul-08 - Interim Trade - STO 1 Oct08 20.00 Call @ 0.31 - Expired
24-Jul-08 - Interim Trade - STO 1 Oct08 17.50 Call @ 0.65 - Expired
20-Oct-08 - Interim Trade - STO 2 Nov08 18.00 Call @ 1.16 - Expired
24-Nov-08 - Interim Trade - STO 2 Dec08 8.00 Call @ 0.27 -

PLCM - Adjustment

The following adjustment was made today on PLCM:

24-Nov-08 - Interim Trade - STO 1 Jan09 22.50 Call @ 0.39 -

Current Position Summary:

Stock Investment: $3,164.00
Income Generated: $738.00
Percent Income Generated: 23.32%
Annualized Income Generated: 16.53%
Net Profit If Called: -$176.00
Percent Return If Called: -5.56%
Annualized Return If Called: -3.94%
Days Held to Expiration: 515 days

Trade History:

20-Aug-07 - Initial Stock Position - BTO 100 PLCM @ 31.64 -
20-Aug-07 - Initial Call Option - STO 1 Sep07 30.00 Call @ 2.55 - Expired
24-Sep-07 - Continued Trade - STO 1 Oct07 30.00 Call @ 0.34 - Expired
22-Oct-07 - Continued Trade - STO 1 Nov07 30.00 Call @ 0.79 - Expired
20-Nov-07 - Continued Trade - STO 1 Dec07 30.00 Call @ 0.27 - Expired
14-Jan-08 - Interim Trade - STO 1 Feb08 25.00 Call @ 0.78 - Expired
21-Feb-08 - Interim Trade - STO 1 Mar08 25.00 Call @ 0.29 - Expired
25-Mar-08 - Interim Trade - STO 1 May08 25.00 Call @ 0.73 - Closed
16-May-08 - Buy Back & Roll Out/Up - BTC 1 May08 25.00 Call @ -0.06 -
19-May-08 - Continued Trade - STO 1 Jul08 30.00 Call @ 0.24 - Expired
22-Jul-08 - Interim Trade - STO 1 Oct08 25.00 Call @ 0.83 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 25.00 Call @ 0.23 - Expired
24-Nov-08 - Interim Trade - STO 1 Jan09 22.50 Call @ 0.39 -

PFCB - Adjustment

The following adjustment was made today on PFCB:

24-Nov-08 - Interim Trade - STO 1 Dec08 20.00 Call @ 0.34 -

Current Position Summary:

Stock Investment: $3,578.00
Income Generated: $647.00
Percent Income Generated: 18.08%
Annualized Income Generated: 13.55%
Net Profit If Called: -$931.00
Percent Return If Called: -26.02%
Annualized Return If Called: -19.50%
Days Held to Expiration: 487 days

Trade History:

20-Aug-07 - Initial Stock Position - BTO 100 PFCB @ 35.78 -
20-Aug-07 - Initial Call Option - STO 1 Sep07 35.00 Call @ 2.30 - Expired
24-Sep-07 - Continued Trade - STO 1 Oct07 35.00 Call @ 0.39 - Expired
25-Oct-07 - Continued Trade - STO 1 Jan08 35.00 Call @ 0.22 - Expired
24-Jan-08 - Interim Trade - STO 1 Feb08 30.00 Call @ 0.65 - Expired
21-Feb-08 - Interim Trade - STO 1 Mar08 30.00 Call @ 0.74 - Expired
25-Mar-08 - Continued Trade - STO 1 Apr08 35.00 Call @ 0.34 - Expired
24-Apr-08 - Continued Trade - STO 1 Jun08 35.00 Call @ 0.49 - Expired
24-Jul-08 - Interim Trade - STO 1 Sep08 30.00 Call @ 0.63 - Closed
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 30.00 Call @ -0.06 -
12-Sep-08 - Interim Trade - STO 1 Oct08 30.00 Call @ 0.09 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 22.50 Call @ 0.34 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 22.50 Call @ 0.34 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 20.00 Call @ 0.34 -

MHP - Adjustment

The following adjustment was made today on MHP:

24-Nov-08 - Interim Trade - STO 1 Jan09 30.00 Call @ 0.87 -

Current Position Summary:

Stock Investment: $4,527.00
Income Generated: $467.00
Percent Income Generated: 10.32%
Annualized Income Generated: 15.56%
Net Profit If Called: -$1,060.00
Percent Return If Called: -23.42%
Annualized Return If Called: -35.32%
Days Held to Expiration: 242 days

Trade History:

19-May-08 - Initial Stock Position - BTO 100 MHP @ 45.27 -
19-May-08 - Initial Call Option - STO 1 Jun08 45.00 Call @ 1.64 - Expired
11-Jun-08 - Dividend Received - DIV 100 Dividend @ 0.22 -
07-Jul-08 - Continued Trade - STO 1 Aug08 45.00 Call @ 0.34 - Expired
22-Aug-08 - Continued Trade - STO 1 Sep08 45.00 Call @ 0.51 - Expired
10-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.22 -
23-Sep-08 - Continued Trade - STO 1 Nov08 45.00 Call @ 0.79 - Closed
20-Oct-08 - Buy Back and Roll Down - BTC 1 Nov08 45.00 Call @ -0.21 - Closed
20-Oct-08 - Interim Trade - STO 1 Nov08 35.00 Call @ 0.29 - Expired
24-Nov-08 - Interim Trade - STO 1 Jan09 30.00 Call @ 0.87 -

MCO - Adjustment

The following adjustments were made today on MCO:

24-Nov-08 - Interim Trade - STO 2 Jan09 25.00 Call @ 1.20 -

Current Position Summary:

Stock Investment: $10,649.00
Income Generated: $2,140.80
Percent Income Generated: 20.10%
Annualized Income Generated: 12.92%
Net Profit If Called: -$3,508.20
Percent Return If Called: -32.94%
Annualized Return If Called: -21.17%
Days Held to Expiration: 568 days

Trade History:

28-Jun-07 - Initial Stock Position - BTO 100 MCO @ 62.41 -
28-Jun-07 - Initial Call Option - STO 1 Jul07 60.00 Call @ 3.49 - Expired
25-Jul-07 - Continued Trade - STO 1 Aug07 60.00 Call @ 1.54 - Expired
20-Aug-07 - Interim Trade - STO 1 Sep07 55.00 Call @ 0.89 - Expired
10-Sep-07 - Dividend Received - DIV 100 Dividend @ 0.08 -
24-Sep-07 - Interim Trade - STO 1 Oct07 55.00 Call @ 0.24 - Expired
25-Oct-07 - Second Stock Position - BTO 100 MCO @ 44.08 -
25-Oct-07 - Combined Cost Basis - $10,649.00 200 @ 53.25 -
25-Oct-07 - Continued Trade - STO 2 Dec07 55.00 Call @ 0.29 - Expired
10-Dec-07 - Dividend Received - DIV 200 Dividend @ 0.08 -
24-Jan-08 - Interim Trade - STO 2 Feb08 40.00 Call @ 0.89 - Expired
21-Feb-08 - Interim Trade - STO 2 Mar08 45.00 Call @ 0.24 - Expired
10-Mar-08 - Dividend Received - DIV 200 Dividend @ 0.10 -
25-Mar-08 - Interim Trade - STO 2 May08 45.00 Call @ 0.54 - Expired
16-May-08 - Buy Back & Roll Out/Up - BTC 2 May08 45.00 Call @ -0.11 -
22-May-08 - Interim Trade - STO 2 Jul08 40.00 Call @ 0.94 - Expired
10-Jun-08 - Dividend Received - DIV 200 Dividend @ 0.10 -
30-Jul-08 - Interim Trade - STO 1 Aug08 40.00 Call @ 0.54 - Closed
30-Jul-08 - Interim Trade - STO 1 Sep08 40.00 Call @ 1.04 - Closed
15-Aug-08 - Buy Back and Roll Out - BTC 1 Aug08 40.00 Call @ -0.26 -
15-Aug-08 - Interim Trade - STO 1 Sep08 40.00 Call @ 2.00 - Closed
10-Sep-08 - Dividend Received - DIV 200 Dividend @ 0.10 -
12-Sep-08 - Buy Back & Roll Out - BTC 2 Sep08 40.00 Call @ -0.71 -
12-Sep-08 - Interim Trade - STO 2 Oct08 40.00 Call @ 1.69 - Expired
20-Oct-08 - Interim Trade - STO 2 Nov08 30.00 Call @ 0.56 - Expired
24-Nov-08 - Interim Trade - STO 2 Jan09 25.00 Call @ 1.20 -

LM - Adjustment

The following adjustment was made today on LM:

24-Nov-08 - Interim Trade - STO 1 Dec08 20.00 Call @ 0.49 -

Current Position Summary:

Stock Investment: $9,109.00
Income Generated: $1,742.00
Percent Income Generated: 19.12%
Annualized Income Generated: 13.66%
Net Profit If Called: -$5,367.00
Percent Return If Called: -58.92%
Annualized Return If Called: -42.09%
Days Held to Expiration: 511 days

Trade History:

27-Jul-07 - Initial Stock Position - BTO 100 LM @ 91.09 -
27-Jul-07 - Initial Call Option - STO 1 Aug07 90.00 Call @ 3.49 - Expired
20-Aug-07 - Continued Trade - STO 1 Sep07 90.00 Call @ 2.09 - Expired
24-Sep-07 - Continued Trade - STO 1 Oct07 90.00 Call @ 0.47 - Expired
15-Oct-07 - Dividend Received - DIV 100 Dividend @ 0.24 -
25-Oct-07 - Continued Trade - STO 1 Dec07 85.00 Call @ 2.09 - Expired
31-Dec-07 - Dividend Received - DIV 100 Dividend @ 0.24 -
07-Jan-08 - Interim Trade - STO 1 Feb08 80.00 Call @ 0.97 - Expired
21-Feb-08 - Interim Trade - STO 1 Mar08 75.00 Call @ 0.64 - Expired
25-Mar-08 - Interim Trade - STO 1 Apr08 65.00 Call @ 0.68 - Expired
07-Apr-08 - Dividend Received - DIV 100 Dividend @ 0.24 -
23-Apr-08 - Interim Trade - STO 1 May08 65.00 Call @ 0.39 - Expired
22-May-08 - Interim Trade - STO 1 Jul08 60.00 Call @ 0.82 - Expired
07-Jul-08 - Dividend Received - DIV 100 Dividend @ 0.24 -
29-Jul-08 - Interim Trade - STO 1 Sep08 45.00 Call @ 1.40 - Closed
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 45.00 Call @ -0.40 -
12-Sep-08 - Interim Trade - STO 1 Oct08 45.00 Call @ 1.50 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 25.00 Call @ 1.59 - Expired
20-Oct-08 - Dividend Received - DIV 100 Dividend @ 0.24 -
24-Nov-08 - Interim Trade - STO 1 Dec08 20.00 Call @ 0.49 -

LLY - Adjustment

The following adjustment was made today on LLY:

24-Nov-08 - Interim Trade - STO 1 Jan09 40.00 Call @ 0.39 -

Current Position Summary:

Stock Investment: $4,971.00
Income Generated: $382.00
Percent Income Generated: 7.68%
Annualized Income Generated: 10.83%
Net Profit If Called: -$589.00
Percent Return If Called: -11.85%
Annualized Return If Called: -16.70%
Days Held to Expiration: 259 days

Trade History:

02-May-08 - Initial Stock Position - BTO 100 LLY @ 49.71 -
02-May-08 - Initial Call Option - STO 1 Jun08 50.00 Call @ 1.29 - Expired
10-Jun-08 - Dividend Received - DIV 100 Dividend @ 0.47 -
07-Jul-08 - Continued Trade - STO 1 Aug08 50.00 Call @ 0.29 - Expired
22-Aug-08 - Continued Trade - STO 1 Sep08 50.00 Call @ 0.32 - Expired
10-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.47 -
23-Sep-08 - Continued Trade - STO 1 Oct08 50.00 Call @ 0.40 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 40.00 Call @ 0.19 - Expired
24-Nov-08 - Interim Trade - STO 1 Jan09 40.00 Call @ 0.39 -

KO - Adjustment

The following adjustment was made today on KO:

24-Nov-08 - Interim Trade - STO 1 Dec08 50.00 Call @ 0.48 -

Current Position Summary:

Stock Investment: $5,022.00
Income Generated: $286.00
Percent Income Generated: 5.69%
Annualized Income Generated: 24.17%
Net Profit If Called: $264.00
Percent Return If Called: 5.26%
Annualized Return If Called: 22.31%
Days Held to Expiration: 86 days

Trade History:

24-Sep-08 - Initial Stock Position - BTO 100 KO @ 50.22 -
24-Sep-08 - Initial Call Option - STO 1 Oct08 50.00 Call @ 1.59 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 50.00 Call @ 0.79 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 50.00 Call @ 0.48 -

JNJ - Adjustment

The following adjustment was made today on JNJ:

24-Nov-08 - Continued Trade - STO 1 Dec08 60.00 Call @ 1.90 -

Current Position Summary:

Stock Investment: $6,146.00
Income Generated: $485.00
Percent Income Generated: 7.89%
Annualized Income Generated: 62.62%
Net Profit If Called: $339.00
Percent Return If Called: 5.52%
Annualized Return If Called: 43.77%
Days Held to Expiration: 46 days

Trade History:

03-Nov-08 - Initial Stock Position - BTO 100 JNJ @ 61.46 -
03-Nov-08 - Initial Call Option - STO 1 Nov08 60.00 Call @ 2.95 - Expired
24-Nov-08 - Continued Trade - STO 1 Dec08 60.00 Call @ 1.90 -

GE - Adjustment

The following adjustment was made today on GE:

24-Nov-08 - Interim Trade - STO 1 Dec08 17.50 Call @ 0.29 -

Current Position Summary:

Stock Investment: $2,501.00
Income Generated: $242.00
Percent Income Generated: 9.68%
Annualized Income Generated: 40.60%
Net Profit If Called: -$509.00
Percent Return If Called: -20.35%
Annualized Return If Called: -85.38%
Days Held to Expiration: 87 days

Trade History:

23-Sep-08 - Initial Stock Position - BTO 100 GE @ 25.01 -
23-Sep-08 - Initial Call Option - STO 1 Oct08 25.00 Call @ 1.79 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 22.00 Call @ 0.34 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 17.50 Call @ 0.29 -

FTEK - Adjustment

The following adjustment was made today on FTEK:

24-Nov-08 - Interim Trade - STO 1 Jan09 12.50 Call @ 0.24 -

Current Position Summary:

Stock Investment: $2,839.00
Income Generated: $343.00
Percent Income Generated: 12.08%
Annualized Income Generated: 7.64%
Net Profit If Called: -$1,246.00
Percent Return If Called: -43.89%
Annualized Return If Called: -27.76%
Days Held to Expiration: 577 days

Trade History:

19-Jun-07 - Initial Stock Position - BTO 100 FTEK @ 28.39 -
19-Jun-07 - Initial Call Option - STO 1 Dec07 30.00 Call @ 3.29 - Expired
07-Jan-08 - Continued Trade - STO 1 Feb08 25.00 Call @ 0.34 - Expired
21-Feb-08 - Interim Trade - STO 1 Mar08 22.50 Call @ 0.44 - Expired
25-Mar-08 - Interim Trade - STO 1 May08 22.50 Call @ 0.74 - Closed
29-Apr-08 - Buy Back & Roll Out/Up - BTC 1 May08 22.50 Call @ -3.91 -
29-Apr-08 - Continued Trade - STO 1 Jun08 30.00 Call @ 0.69 - Expired
07-Jul-08 - Interim Trade - STO 1 Aug08 22.50 Call @ 0.39 - Expired
22-Aug-08 - Interim Trade - STO 1 Sep08 22.50 Call @ 0.64 - Closed
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 22.50 Call @ -0.16 -
12-Sep-08 - Interim Trade - STO 1 Oct08 22.50 Call @ 0.24 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 17.50 Call @ 0.49 - Expired
24-Nov-08 - Interim Trade - STO 1 Jan09 12.50 Call @ 0.24 -

EXP - Adjustment

The following adjustments were made today on EXP:

24-Nov-08 - Interim Trade - STO 2 Dec08 20.00 Call @ 0.34 -

Current Position Summary:

Stock Investment: $10,856.00
Income Generated: $2,603.35
Percent Income Generated: 23.98%
Annualized Income Generated: 9.02%
Net Profit If Called: -$4,252.65
Percent Return If Called: -39.17%
Annualized Return If Called: -14.74%
Days to Expiration: 970 days

Trade History:

24-Apr-06 - Initial Stock Position - BTO 100 EXP @ 70.60 -
24-Apr-06 - Initial Call Option - STO 1 May06 65.00 Call @ 8.29 - Expired
22-May-06 - Continued Trade - STO 1 Oct06 60.00 Call @ 2.39 -
20-Jul-06 - Dividend Received - DIV 100 Dividend @ 0.18 -
25-Jul-06 - Interim Trade - STO 1 Jan07 50.00 Call @ 2.19 - Closed
25-Jul-06 - Buy Back & Roll Out/Down - BTC 1 Oct06 60.00 Call @ -0.21 - Closed
23-Oct-06 - Interim Trade - STO 1 Jan07 40.00 Call @ 1.34 - Closed
23-Oct-06 - Buy Back & Roll Down - BTC 1 Jan07 50.00 Call @ -0.26 -
02-Nov-06 - Dividend Received - DIV 100 Dividend @ 0.18 -
19-Dec-06 - Buy Back & Roll Out/Up - BTC 1 Jan07 40.00 Call @ -3.41 -
19-Dec-06 - Interim Trade - STO 1 Jul07 45.00 Call @ 4.39 - Closed
05-Jul-07 - Interim Trade - STO 1 Jan08 55.00 Call @ 3.29 - Closed
05-Jul-07 - Buy Back & Roll Out/Up - BTC 1 Jul07 45.00 Call @ -5.41 -
20-Jul-07 - Dividend Received - DIV 100 Dividend @ 0.20 -
24-Oct-07 - Buy Back & Roll Down - BTC 1 Jan08 55.00 Call @ -0.16 -
24-Oct-07 - Second Stock Position - BTO 100 EXP @ 37.96 -
24-Oct-07 - Combined Cost Basis - $10,856.00 200 @ 54.28 -
24-Oct-07 - Interim Trade - STO 2 Jan08 45.00 Call @ 0.69 - Expired
05-Nov-07 - Dividend Received - DIV 100 Dividend @ 0.20 -
21-Jan-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
24-Jan-08 - Interim Trade - STO 2 Feb08 35.00 Call @ 1.29 - Expired
21-Feb-08 - Interim Trade - STO 2 Apr08 40.00 Call @ 0.84 - Expired
18-Apr-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
23-Apr-08 - Interim Trade - STO 2 Jul08 40.00 Call @ 0.99 - Expired
22-Jul-08 - Interim Trade - STO 1 Oct08 30.00 Call @ 0.54 - Expired
23-Jul-08 - Interim Trade - STO 1 Sep08 30.00 Call @ 0.34 - Closed
24-Jul-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 30.00 Call @ -0.36 -
12-Sep-08 - Interim Trade - STO 1 Oct08 30.00 Call @ 1.09 - Expired
20-Oct-08 - Interim Trade - STO 2 Nov08 20.00 Call @ 0.64 - Expired
06-Nov-08 - Dividend Received - DIV 200 Dividend @ 0.20 -
24-Nov-08 - Interim Trade - STO 2 Dec08 20.00 Call @ 0.34 -

EMR - Adjustment

The following adjustment was made today on EMR:

24-Nov-08 - Continued Trade - STO 1 Dec08 35.00 Call @ 1.54 -

Current Position Summary:

Stock Investment: $3,569.00
Income Generated: $377.00
Percent Income Generated: 10.56%
Annualized Income Generated: 87.63%
Net Profit If Called: $308.00
Percent Return If Called: 8.63%
Annualized Return If Called: 71.59%
Days Held to Expiration: 44 days

Trade History:

05-Nov-08 - Initial Stock Position - BTO 100 EMR @ 35.69 -
05-Nov-08 - Initial Call Option - STO 1 Nov08 35.00 Call @ 1.90 - Expired
24-Nov-08 - Continued Trade - STO 1 Dec08 35.00 Call @ 1.54 -
10-Dec-08 - Dividend Received - DIV 100 Dividend @ 0.33 -

CNI - Adjustment

The following adjustment was made today on CNI:

24-Nov-08 - Interim Trade - STO 1 Dec08 40.00 Call @ 0.46 -

Current Position Summary:

Stock Investment: $5,201.00
Income Generated: $487.42
Percent Income Generated: 9.37%
Annualized Income Generated: 39.32%
Net Profit If Called: -$713.58
Percent Return If Called: -13.72%
Annualized Return If Called: -57.56%
Days Held to Expiration: 87 days

Trade History:

23-Sep-08 - Initial Stock Position - BTO 100 CNI @ 52.01 -
23-Sep-08 - Initial Call Option - STO 1 Oct08 50.00 Call @ 3.19 - Expired
30-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.22 -
30-Sep-08 - Withholding Tax - TAX 1 CA Tax @ -0.03 -
20-Oct-08 - Interim Trade - STO 1 Nov08 45.00 Call @ 1.04 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 40.00 Call @ 0.46 -

CCL - Adjustment

The following adjustment was made today on CCL:

24-Nov-08 - Interim Trade - STO 2 Jan09 22.50 Call @ 0.64 -

Current Position Summary:

Stock Investment: $8,125.00
Income Generated: $783.80
Percent Income Generated: 9.65%
Annualized Income Generated: 13.59%
Net Profit If Called: -$2,841.20
Percent Return If Called: -34.97%
Annualized Return If Called: -49.28%
Days Held to Expiration: 259 days

Trade History:

02-May-08 - Initial Stock Position - BTO 100 CCL @ 41.36 -
02-May-08 - Initial Call Option - STO 1 Jun08 42.50 Call @ 1.38 - Expired
13-Jun-08 - Dividend Received - DIV 100 Dividend @ 0.40 -
07-Jul-08 - Interim Trade - STO 1 Aug08 35.00 Call @ 0.79 - Closed
05-Aug-08 - Buy Back and Roll Out/Up - BTC 1 Aug08 35.00 Call @ -5.11 -
05-Aug-08 - Dollar Cost Averaging - BTO 100 CCL @ 39.89 -
05-Aug-08 - Combined Cost Basis - $8,125.00 200 @ 40.63 -
05-Aug-08 - Continued Trade - STO 2 Oct08 40.00 Call @ 3.15 - Expired
12-Sep-08 - Dividend Received - DIV 200 Dividend @ 0.40 -
20-Oct-08 - Interim Trade - STO 2 Nov08 32.50 Call @ 0.99 - Expired
24-Nov-08 - Interim Trade - STO 2 Jan09 22.50 Call @ 0.64 -

BJS - Adjustment

The following adjustments were made today on BJS:

24-Nov-08 - Interim Trade - STO 3 Jan09 15.00 Call @ 0.24 -

Current Position Summary:

Stock Investment: $11,238.00
Income Generated: $2,985.35
Percent Income Generated: 26.56%
Annualized Income Generated: 8.92%
Net Profit If Called: -$3,762.55
Percent Return If Called: -33.39%
Annualized Return If Called: -11.21%
Days Held to Expiration: 1087 days

Trade History:

25-Jan-06 - Initial Stock Position - BTO 200 BJS @ 40.05 -
25-Jan-06 - Initial Call Option - STO 2 Feb06 40.00 Call @ 1.54 - Expired
21-Feb-06 - Continued Trade - STO 2 Apr06 40.00 Call @ 0.49 - Closed
20-Mar-06 - Buy Back - BTC 2 Apr06 40.00 Call @ -0.11 -
20-Mar-06 - Second Stock Position - BTO 100 BJS @ 32.29 -
20-Mar-06 - Combined Cost Basis - $11,238.00 300 @ 37.46 -
20-Mar-06 - Continued Trade - STO 3 Jul05 37.50 Call @ 0.94 - Expired
14-Jul-06 - Dividend Received - DIV 300 Dividend @ 0.05 -
24-Jul-06 - Interim Trade - STO 3 Oct06 35.00 Call @ 1.19 -
13-Oct-06 - Dividend Received - DIV 300 Dividend @ 0.05 -
23-Oct-06 - Interim Trade - STO 3 Jan07 35.00 Call @ 0.79 -
22-Dec-06 - Buy Back & Roll Out - BTC 3 Jan07 35.00 Call @ -0.11 - Closed
22-Dec-06 - Continued Trade - STO 3 Jul07 35.00 Call @ 1.66 - Closed
12-Jan-07 - Dividend Received - DIV 300 Dividend @ 0.05 -
13-Apr-07 - Dividend Received - DIV 300 Dividend @ 0.05 -
21-Jun-07 - Buy Back & Roll Out/Down - BTC 3 Jul07 35.00 Call @ -0.11 - Closed
21-Jun-07 - Interim Trade - STO 3 Oct07 32.50 Call @ 0.79 - Expired
13-Jul-07 - Dividend Received - DIV 300 Dividend @ 0.05 -
12-Oct-07 - Dividend Received - DIV 300 Dividend @ 0.05 -
30-Oct-07 - Interim Trade - STO 3 Dec07 27.50 Call @ 0.55 - Expired
11-Jan-08 - Dividend Received - DIV 300 Dividend @ 0.05 -
14-Jan-08 - Interim Trade - STO 3 Apr08 27.50 Call @ 0.64 - Closed
14-Apr-08 - Buy Back & Roll Out/Up - BTC 3 Apr08 27.50 Call @ -1.71 -
14-Apr-08 - Interim Trade - STO 3 Jul08 30.00 Call @ 1.84 - Expired
15-Apr-08 - Dividend Received - DIV 300 Dividend @ 0.05 -
15-Jul-08 - Dividend Received - DIV 300 Dividend @ 0.05 -
23-Jul-08 - Continued Trade - STO 2 Aug08 35.00 Call @ 0.42 - Expired
23-Jul-08 - Continued Trade - STO 1 Aug08 32.50 Call @ 1.14 - Expired
22-Aug-08 - Continued Trade - STO 2 Oct08 32.50 Call @ 0.31 - Expired
22-Aug-08 - Continued Trade - STO 1 Oct08 30.00 Call @ 0.78 - Expired
14-Oct-08 - Dividend Received - DIV 300 Dividend @ 0.05 -
20-Oct-08 - Interim Trade - STO 3 Nov08 17.50 Call @ 0.29 - Expired
24-Nov-08 - Interim Trade - STO 3 Jan09 15.00 Call @ 0.24 -

BHP - Adjustment

The following adjustment was made today on BHP:

24-Nov-08 - Interim Trade - STO 2 Dec08 37.50 Call @ 1.57 -

Current Position Summary:

Stock Investment: $12,754.00
Income Generated: $1,775.20
Percent Income Generated: 13.92%
Annualized Income Generated: 41.30%
Net Profit If Called: -$3,478.80
Percent Return If Called: -27.28%
Annualized Return If Called: -80.94%
Days Held to Expiration: 123 days

Trade History:

18-Aug-08 - Initial Stock Position - BTO 100 BHP @ 65.11 -
18-Aug-08 - Initial Call Option - STO 1 Sep08 65.00 Call @ 3.00 - Expired
22-Sep-08 - Continued Trade - STO 1 Oct08 65.00 Call @ 3.30 - Expired
23-Sep-08 - Second Stock Position - BTO 100 BHP @ 62.43 -
23-Sep-08 - Combined Cost Basis - $12,754.00 200 @ 63.77 -
23-Sep-08 - Initial Call Option - STO 1 Oct08 60.00 Call @ 5.10 - Expired
25-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.82 -
20-Oct-08 - Interim Trade - STO 2 Nov08 45.00 Call @ 1.19 - Expired
24-Nov-08 - Interim Trade - STO 2 Dec08 37.50 Call @ 1.57 -

BAC - Adjustment

The following adjustment was made today on BAC:

24-Nov-08 - Interim Trade - STO 1 Dec08 17.50Call @ 0.47 -

Current Position Summary:

Stock Investment: $3,372.00
Income Generated: $505.00
Percent Income Generated: 14.98%
Annualized Income Generated: 63.56%
Net Profit If Called: -$1,117.00
Percent Return If Called: -33.13%
Annualized Return If Called: -140.59%
Days Held to Expiration: 86

Trade History:

24-Sep-08 - Initial Stock Position - BTO 100 BAC @ 33.72 -
24-Sep-08 - Initial Call Option - STO 1 Oct08 32.50 Call @ 3.21 - Expired
26-Sep-08 - Dividend Received - DIV 100 Dividend @ 0.64 -
20-Oct-08 - Interim Trade - STO 1 Nov08 27.50 Call @ 0.73 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 17.50Call @ 0.47 -

AXP - Adjustment

The following adjustment was made today on AXP:

24-Nov-08 - Interim Trade - STO 2 Dec08 25.00 Call @ 0.54 -

Current Position Summary:

Stock Investment: $9,400.00
Income Generated: $1,735.20
Percent Income Generated: 18.46%
Annualized Income Generated: 17.41%
Net Profit If Called: -$2,664.80
Percent Return If Called: -28.35%
Annualized Return If Called: -26.74%
Days Held to Expiration: 387 days

Trade History:

28-Nov-07 - Initial Stock Position - BTO 100 AXP @ 56.74 -
28-Nov-07 - Initial Call Option - STO 1 Dec07 55.00 Call @ 3.21 - Expired
07-Jan-08 - Continued Trade - STO 1 Feb08 55.00 Call @ 0.69 - Expired
08-Feb-08 - Dividend Received - DIV 100 Dividend @ 0.18 -
21-Feb-08 - Interim Trade - STO 1 Apr08 50.00 Call @ 0.89 - Expired
25-Apr-08 - Interim Trade - STO 1 May08 50.00 Call @ 0.30 - Expired
09-May-08 - Dividend Received - DIV 100 Dividend @ 0.18 -
19-May-08 - Interim Trade - STO 1 Jul08 50.00 Call @ 2.65 - Expired
23-Jul-08 - Interim Trade - STO 1 Aug08 42.50 Call @ 0.60 - Expired
08-Aug-08 - Dividend Received - DIV 100 Dividend @ 0.18 -
22-Aug-08 - Interim Trade - STO 1 Sep08 42.50 Call @ 0.28 - Closed
12-Sep-08 - Buy Back & Roll Out - BTC 1 Sep08 42.50 Call @ -0.16 -
12-Sep-08 - Interim Trade - STO 1 Oct08 42.50 Call @ 0.79 - Expired
23-Sep-08 - Second Stock Position - BTO 100 AXP @ 37.26 -
23-Sep-08 - Combined Cost Basis - $9,400.00 200 @ 47.00 -
23-Sep-08 - Initial Call Option - STO 1 Oct08 35.00 Call @ 3.67 - Expired
20-Oct-08 - Interim Trade - STO 2 Nov08 27.50 Call @ 1.22 - Expired
10-Nov-08 - Dividend Received - DIV 200 Dividend @ 0.18 -
24-Nov-08 - Interim Trade - STO 2 Dec08 25.00 Call @ 0.54 -

ADP - Adjustment

The following adjustment was made today on ADP:

24-Nov-08 - Interim Trade - STO 1 Dec08 40.00 Call @ 0.46 -

Current Position Summary:

Stock Investment: $4,308.00
Income Generated: $305.00
Percent Income Generated: 7.08%
Annualized Income Generated: 29.70%
Net Profit If Called: -$3.00
Percent Return If Called: -0.07%
Annualized Return If Called: -0.29%
Days Held to Expiration: 87 days

Trade History:

23-Sep-08 - Initial Stock Position - BTO 100 ADP @ 43.08 -
23-Sep-08 - Initial Call Option - STO 1 Oct08 42.50 Call @ 1.75 - Expired
20-Oct-08 - Interim Trade - STO 1 Nov08 37.50 Call @ 0.84 - Expired
24-Nov-08 - Interim Trade - STO 1 Dec08 40.00 Call @ 0.46 -

TLT - Closed

The TLT Nov08 95 Call was exercised on Fri and the stock was called away for
a profit. The following is the trade history and returns, including IB
commissions.

Covered Call Results

Stock Investment: $9,524.00
Income Generated: $103.82
Net Profit: $79.82
Percent Return: 0.84%
Annualized Return: 43.70%
Duration of Trade: 7 days

Trade History:

14-Nov-08 - Initial Stock Position - BTO 100 TLT @ 95.24 -
14-Nov-08 - Initial Call Option - STO 1 Nov08 95.00 Call @ 1.04 - Exercised
21-Nov-08 - Option Exercised - EX 1 Dec08 95.00 Call @ 95.00 -

PG - Closed

The PG Nov08 62.50 Call was exercised on Fri and the stock was called away for
a profit. The following is the trade history and returns, including IB
commissions.

Covered Call Results

Stock Investment: $6,466.00
Income Generated: $359.00
Net Profit: $143.00
Percent Return: 2.21%
Annualized Return: 44.85%
Duration of Trade: 18 days

Trade History:

03-Nov-08 - Initial Stock Position - BTO 100 PG @ 64.66 -
03-Nov-08 - Initial Call Option - STO 1 Nov08 62.50 Call @ 3.59 - Exercised
21-Nov-08 - Option Exercised - EX 1 Nov08 62.50 Call @ 62.50 -

CL - Closed

The CL Nov08 60.00 Call was exercised on Fri and the stock was called away for
a profit. The following is the trade history and returns, including IB
commissions.

Covered Call Results

Stock Investment: $6,398.00
Income Generated: $519.00
Net Profit: $121.00
Percent Return: 1.89%
Annualized Return: 38.35%
Duration of Trade: 18 days

Trade History:

03-Nov-08 - Initial Stock Position - BTO 100 CL @ 63.98 -
03-Nov-08 - Initial Call Option - STO 1 Nov08 60.00 Call @ 5.19 - Exercised
21-Nov-08 - Option Exercised - EX 1 Nov08 60.00 Call @ 60.00 -

TLT - New Position

A new position was established today on TLT.

Since TIP was called away this week I was going to establish a new TIP position but there was no bid for the Nov or Dec 96 call. So I decided to establish a position on TLT instead, which has more option liquidity. So the fixed income portion of my covered call portfolio will now consist of both TIP & TLT.

I decided on an ITM call for Nov since there's only 7 days left until expiration. Ex-dividend date isn't until the first week of Dec, so after Nov expiration, if TLT is called away, I still have time to establish a Dec covered call and still receive the dividend.

The following is the trade information, including IB commissions:

14-Nov-08 - Initial Stock Position - BTO 100 TLT @ 95.24
14-Nov-08 - Initial Call Option - STO 1 Nov08 95.00 Call @ 1.04

Stock Investment: $9,524.00
Income Generated: $104.00
Percent Income Generated: 1.09%
Annualized Income Generated: 56.94%
Net Profit If Called: $80.00
Percent Return If Called: 0.84%
Annualized Return If Called: 43.80%
Days Held to Expiration: 7 days

TIP - Closed

The second TIP position was assigned on Wed 11/12/08 and called away for a profit. I'll establish a new position either tomorrow or next week.

The following is the trade history and returns, including IB commissions.

Stock Investment: $9,260.00
Income Generated: $49.00
Net Profit: $89.00
Percent Return: 0.96%
Annualized Return: 38.98%
Duration of Trade: 9 days

Trade History:

03-Nov-08 - Initial Stock Position - BTO 100 TIP @ 92.60 -
03-Nov-08 - Initial Call Option - STO 1 Nov08 93.00 Call @ 0.49 - Exercised
12-Nov-08 - Option Exercised - EX 1 Nov08 93.00 Call @ 93.00 -

TIP - New Position

A new dividend position was established today on TIP. The following is the trade information, including IB commissions:

05-Nov-08 - Initial Stock Position - BTO 100 TIP @ 95.09
05-Nov-08 - Initial Call Option - STO 1 Dec08 96.00 Call @ 0.79
05-Dec-08 - Dividend Received - DIV 100 Dividend @ 0.80

Summary without the dividend if called early on Ex-Dividend date:

Stock Investment: $9,509.00
Income Generated: $79.00
Percent Income Generated: 0.83%
Annualized Income Generated: 10.83%
Net Profit If Called: $170.00
Percent Return If Called: 1.79%
Annualized Return If Called: 23.30%
Days Held to Ex-Dividend Date: 28 days

Summary with the dividend if called at option expiration:

Stock Investment: $9,509.00
Income Generated: $159.00
Percent Income Generated: 1.67%
Annualized Income Generated: 13.87%
Net Profit If Called: $250.00
Percent Return If Called: 2.63%
Annualized Return If Called: 21.81%
Days Held to Expiration: 44 days

Dividend Information:

Ex-Dividend Date: 12/03/08 approx.
Dividend Pay Date: 12/05/08 approx.
Dividend Rate: $9.60 approx.
Dividend Yield on Cost: 10.06% approx.