Tuesday, October 30, 2012

New 15-15 Positions

After a discussion on my JustCoveredCalls Yahoo group last week, I established 4 new positions on ANF, BTU, CNX, & SCHN (see Trades below). The criteria used is a minimum of 15% downside protection and 15% annualized return. I added additional criteria to further qualify the positions. The following is the selection criteria:
  • All dividend paying companies.
  • Covered by Morningstar and Value Line Daily Options Survey.
  • Current price below M* Fair Value.
  • CSP strike below or within $5 above the M* Consider Buy Price.
  • CSP downside protection of 15% or greater.
  • CSP annualized return of 15% or greater.

If these positions work out well, I'll probably continue to establish a limited number of these positions in my portfolio, but the bulk of my portfolio will continue to follow the criteria documented in my trading plan.