BBT - Closed

The BBT Feb08 27.50 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: $2,803.00
Income Generated: $209.00
Net Profit: $156.00
Percent Return: 5.57%
Annualized Return: 52.09%
Duration of Trade: 39 days

Buy & Hold Comparison

Opening Price: $28.03
Closing Price: $33.24
P/L per Share: $5.21
Shares: 100
Dividends: $.46
Net Profit: $567.00
Percent Return: 20.23%
Annualized Return: 189.32%
Duration of Trade: 39 days

Trade History:

07-Jan-08 - Initial Stock Position - BTO 100 BBT @ 28.03 -
07-Jan-08 - Initial Call Option - STO 1 Feb08 27.50 Call @ 1.63 - Exercised
01-Feb-08 - Dividend Received - DIV 100 Dividend @ 0.46 -
15-Feb-08 - Option Exercised - EX 1 Feb08 27.50 Call @ 27.50 -

This was my first dividend play, and while it worked out as expected, the stock took off after I purchased it. I would have been better off using a buy and hold strategy. This is where covered calls underperform buy and hold.