Friday, January 22, 2010

BRK.B - New Position

A new position was established today on Berkshire Hathaway Class B (BRK.B). All prices include IB commissions.

Since Berkshire Hathaway Class B shares split 50-1 this week I decided to take this opportunity to add it to my portfolio. I've always wanted to own some Berkshire but it's always been too rich for my blood. Now it's affordable for everyone. There's also a possibility that Berkshire will be added to the S&P 500 Index once the Burlington Northern acquisition is complete. If that happens, there should be a lot of institutional investment as they add Berkshire to their portfolios which use the S&P 500 as their benchmark. This should result in an increase in the stock price. For that reason, I decided to enter a CC rather than a CSP so I can participate in any upside.

DateStockDescriptionTransactionStatusStock InvestmentIncome Generated
1/22/2010BRK.BFirst Stock PositionBTO 100 BRK.B @ 70.94 ($7,094.00) 
1/22/2010BRK.BInitial Call OptionSTO 1 Feb10 72.00 Call @ 1.59  $159.00

Position Summary

Stock Investment$7,094.00
Income Generated$159.00
Percent Income Generated2.24$%
Annualized Income Generated29.22%
Net Profit If Called$265.00
Percent Return If Called3.74%
Annualized Return If Called48.70%
Days Held to Expiration28 days