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Wednesday, April 25, 2012

Continuation Transactions -- Eight Covered Calls Positions

Upon Apr2012 options expiration, eleven covered calls positions in the Covered Calls Advisor Portfolio (CCAP) expired. Today, a decision was made to re-establish covered calls positions in eight of these positions -- Apple Inc.(AAPL), Goldcorp Inc.(GG), Halliburton Company (HAL), Hartford Financial Services Group (HIG), iShares MSCI China ETF (FXI), iShares Emerging Markets ETF (EEM), Mylan Inc.(MYL), and Market Vectors Russia ETF (RSX). The detailed transactions history for these positions as well as some possible overall performance results are as follows:

1. Apple Inc.(AAPL) -- Continuation
The transactions history is as follows:
03/19/2012 Bought 100 AAPL shares @ $593.00
03/19/2012 Sold 1 AAPL Apr2012 $620.00 Call Option @ $18.25
Note: the price of AAPL was $595.43 when this call option was sold.
04/22/2012 AAPL Apr2012 Call options expired.
04/25/2012 Sold 1 AAPL May2012 $630.00 Call at $15.50
Note: the price of AAPL was $617.60 when this call option was sold.

Two possible overall performance results(including commissions) for these Apple Inc.(AAPL) transactions would be as follows:
Stock Purchase Cost: $59,308.95
= ($593.00*100+$8.95 commission)

Net Profit:
(a) Options Income: +$3,355.60
= ($18.25+$15.50)*100 shares - 2*$9.70 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (If stock price unchanged at $617.60): +$2,451.05
=($617.60-$593.00)*100 - $8.95 commissions
(c) Capital Appreciation (If stock assigned at $630.00): +$3,691.05
=($630.00-$593.00)*100 - $8.95 commissions

Total Net Profit(If stock price unchanged at $617.60 upon May2012 expiration): +$5,806.65 = (+$3,355.60 +$0.00 +$2,451.05)
Total Net Profit(If stock assigned at $630.00 at May2012 expiration): +$7,046.65
= (+$3,355.60 +$0.00 +$3,691.05)

1. Absolute Return (If stock price unchanged upon May2012 expiration): +9.8%
= +$5,806.65/$59,308.95
Annualized Return (If stock price unchanged at May2012 expiration): +57.6%
= (+$5,806.65/$59,308.95)*(365/62 days)

2. Absolute Return (If stock assigned at $630.00 at Apr2012 expiration): +11.9%
= +$7,046.65/$59,308.95
Annualized Return (If stock assigned): +69.9%
= (+$7,046.65/$59,308.95)*(365/62 days)


2. Goldcorp Inc.(GG) -- Continuation
The transactions were as follows:
03/07/2012 Bought 200 Goldcorp Shares @ $46.75
03/08/2012 Sold 2 GG Apr2012 $48.00 Calls @ $1.55
Note: the price of Goldcorp was $47.14 today when the calls were sold.
04/22/2012 GG Apr2012 Call options expired.
04/25/2012 Sold 2 GG May2012 $43.00 Calls at $.52
Note: the price of GG was $40.69 when these call options were sold.

Two possible overall performance results(including commissions) for the Goldcorp Inc.(GG) transactions would be as follows:
Stock Purchase Cost: $9,358.95
= ($46.75*200+$8.95 commission)

Net Profit:
(a) Options Income: +$393.10
= ($1.55+$.52)*200 shares - 2*$10.45 commissions
(b) Dividend Income (GG provides $.045 monthly dividends): +$27.00
= $.045 per share x 200 shares x 3 ex-div dates prior to May2012 expiration
(c) Capital Appreciation (If stock price unchanged at $40.69): -$1,220.95
+($40.69-$46.75)*200 - $8.95 commissions
(c) Capital Appreciation (If stock assigned at $43.00): -$758.95
+($43.00-$46.75)*200 - $8.95 commissions

Total Net Profit(If stock price unchanged at May2012 expiration): -$800.85
= (+$393.10 +$27.00 -$1,220.95)
Total Net Profit(If stock assigned at $43.00 at May2012 expiration): -$338.85
= (+$393.10 +$27.00 -$758.95)

1. Absolute Return (If stock price unchanged at $40.69 upon May2012 expiration):
-8.6% = -$800.85/$9,358.95
Annualized Return (If stock price unchanged at May2012 expiration): -50.4%
= (-$800.85/$9,358.95)*(365/44 days)

2. Absolute Return (If stock assigned at $43.00 upon May2012 expiration): -3.6%
= -$338.85/$9,358.95
Annualized Return (If stock assigned at May2012 expiration): -21.3%
= (-$338.85/$9,358.95)*(365/62 days)


3. Halliburton Co.(HAL) -- Continuation
The transactions were as follows:
03/07/2012 Bought 300 Halliburton Co. Shares @ $34.02
03/08/2012 Sold 3 HAL Mar2012 $35.00 Calls @ $.48
Note: the price of Halliburton was $34.59 today when the calls were sold. 03/18/2012 Mar2012 options expired.
03/19/2012 Sold 3 HAL Apr2012 $35.00 Calls @ $1.18
Note: the price of HAL was $34.90 when these options were sold.
04/22/2012 HAL Apr2012 Call options expired.
04/25/2012 Sold 3 HAL May2012 $35.00 Calls at $.52
Note: the price of HAL was $33.95 when these call options were sold.

Two possible overall performance results(including commissions) for the Halliburton Co.(HAL) transactions would be as follows:
Stock Purchase Cost: $10,214.95
= ($34.02*300+$8.95 commission)

Net Profit:
(a) Options Income: +$620.40
= ($.48+$1.18+$.52)*300 shares - 3*$11.20 commissions
(b) Dividend Income: $0.00
(c) Capital Appreciation (If stock price unchanged at $33.95): -$29.95
+($33.95-$34.02)*300 - $8.95 commissions
(c) Capital Appreciation (If stock assigned at $35.00): +$285.05
+($35.00-$34.02)*300 - $8.95 commissions

Total Net Profit(If stock price unchanged at May2012 expiration): +$590.45
= (+$620.40 +$0.00 -$29.95)
Total Net Profit(If stock assigned at $35.00 at May2012 expiration): +$905.45
= (+$620.40 +$0.00 +$285.05)

1. Absolute Return (If stock price unchanged at May2012 expiration): +5.8%
= +$590.45/$10,214.95
Annualized Return (If stock price unchanged at May2012 expiration): +28.5%
= (+$590.45/$10,214.95)*(365/74 days)

2. Absolute Return (If stock assigned at $35.00 at May2012 expiration): +8.9%
= +$905.45/$10,214.95
Annualized Return (If stock assigned): +43.7%
= (+$905.45/$10,214.95)*(365/74 days)


4. Hartford Financial Services Group (HIG) -- Continuation
The transactions history is as follows:
03/23/2012 Sold 3 Hartford Financial Services Group (HIG) Apr2012 $21.00 Put Options @ $.67
Note: the price of HIG was $21.29 today when these Puts were sold.
04/22/2012 HIG Apr2012 Puts expired.  300 shares HIG purchased at $21.00 per share.
04/25/2012 Sold 3 HIG May2012 $21.00 Calls at $.65
Note: the price of HIG was $20.72 when these Calls were sold.


Two possible overall performance results(including commissions) for the Hartford Financial Services Group (HIG) transactions would be as follows:

Stock Purchase Cost: $6,308.95
= ($21.00*300+$8.95 commission)

Net Profit:
(a) Options Income: +$373.60
= ($.67+$.65)*300 shares - 2*$11.20 commissions
(b) Dividend Income: $0.00
(c) Capital Appreciation (If stock price unchanged at $20.72): -$92.95
+($20.72-$21.00)*300 - $8.95 commissions
(c) Capital Appreciation (If stock assigned at $21.00): -$8.95
+($21.00-$21.00)*300 - $8.95 commissions
Total Net Profit (If stock price unchanged at $20.72 upon May2012 expiration): +$280.65 = (+$373.60 +$0.00 -$92.95)
Total Net Profit (If stock assigned at $21.00 at May2012 expiration): +$364.65
= (+$373.60 +$0.00 -$8.95)

1. Absolute Return (If stock price unchanged at May2012 expiration): +4.4%
= +$280.65/$6,308.95
Annualized Return (If stock price unchanged at May2012 expiration): +28.0%
= (+$280.65/$6,308.95)*(365/58 days)

2. Absolute Return (If stock assigned at $21.00 at May2012 expiration): +5.8%
= +$364.65/$6,308.95
Annualized Return (If stock assigned): +36.4%
=(+$364.65/$6,308.95)*(365/58 days)


5. iShares MSCI China ETF (FXI) -- Continuation
The transactions history is as follows:
04/18/2011 Bought 1,000 FXI @ $44.80
04/20/2011 Sold 10 FXI May2011 $47.00 Calls @ $.49
Note: the price of FXI was $45.88 when the calls were sold.
05/31/2011 Sold 10 FXI Jul2011 $47.00 Calls @ $.37
Note: The price of FXI was $45.18 when these call options were sold.
06/21/2011 FXI ETF distribution of $.68555 per share
07/16/2011 Jul2011 FXI options expired.
07/18/2011 Sold 10 FXI Aug2011 $42.00 Calls @$.71
08/20/2011 Aug2011 FXI options expired.
08/22/2011 Sold 10 FXI Sep2011 $42.00 Calls @ $.65
09/17/2011 Sep2011 FXI options expired.
09/20/2011 Sold 10 FXI Oct2011 $38.00 Calls @ $.47
10/22/2011 Oct2011 options expired.
10/26/2011 Sold 10 FXI Nov2011 $37.00 Calls @ $.86
11/19/2011 Nov2011 FXI options expired.
11/30/2011 Sold 10 FXI Jan2012 $38.00 Calls @ $1.10
Note: the price of FXI was $36.42 today when these call options were sold.
12/20/2011 Ex-Distribution $79.40 = $.0794 * 1,000 shares
01/20/2012 Bought-to-Close 10 FXI Jan2012 $38.00 Calls @ $.68
Note: the price of FXI was $38.67 when these call options were bought.
01/20/2012 Sold 10 FXI Feb2012 $40.00 Calls @ $.49
Note: the price of FXI was $38.72 today when these call options were sold.
02/17/2012 Bought-to-Close 10 FXI Feb2012 $40.00 Calls @ $.27
02/17/2012 Sold-to-Open 10 FXI Mar2012 $40.00 Calls @ $1.30
Note: the price of FXI was $40.25 when these transactions were made.
03/17/2012 Mar2012 FXI options expired.
04/03/2012 Sold 10 FXI Apr2012 $38.00 Calls @ $.44
Note: the price of FXI was $37.31 when these options were sold.
04/22/2012 FXI Apr2012 Call options expired.
04/25/2012 Sold 10 FXI May2012 $38.00 Calls at $.70
Note: the price of FXI was $37.70 when these call options were sold.

Two possible overall performance result(including commissions) for this iShares MSCI China ETF (FXI) position is as follows:
Stock Purchase Cost: $44,808.95
= ($44.80*1,000+$16.45 commission)

Net Profit:
(a) Options Income: +$6,515.70
= (1,000*($.49+$.37+$.71+$.65+$.47+$.86+$1.10-$.68+$.49-$.27+$1.30+$.44+$.70) - 11*$12.70 commissions)
(b) Distribution Income: $767.95 = ($.68555+$.0794) * 1,000 shares
(c) Capital Appreciation (If FXI price unchanged at $37.70 at expiration): -$7,108.95
= ($37.70-$44.80)*1,000 - $8.95 commissions
(c) Capital Appreciation (If FXI assigned at $38.00 at expiration): -$6,808.95
= ($38.00-$44.80)*1,000 - $8.95 commissions

Total Net Profit (If FXI unchanged at $37.70): +174.70
= (+$6,515.70.00 +$767.95 -$7,108.95)
Total Net Profit (If FXI assigned at $38.00): +$474.70
= (+$6,515.70 +$767.95 -$6,808.95)

Absolute Return (If FXI unchanged at $37.70 at expiration): +0.4%
= +$174.70/$44,808.95
Annualized Return If Unchanged (ARIU): +0.4%
= (+$174.70/$44,808.95)*(365/398 days)

Absolute Return (If FXI assigned at $38.00 at expiration): +1.1%
= +$474.70/$44,808.95
Annualized Return If Assigned (ARIA): +1.0%
= (+$474.70/$44,808.95)*(365/398 days)


6. iShares MSCI Emerging Markets ETF (EEM) -- Continuation
The transactions history is as follows:
03/21/2012 Bought 500 EEM shares @ $43.31
03/21/2012 Sold 5 EEM Apr2012 $44.00 Call Options @ $.78
04/22/2012 EEM Apr2012 Call options expired.
04/25/2012 Sold 5 EEM May2012 $43.00 Calls at $.50
Note: the price of EEM was $42.20 when these call options were sold.

Two possible overall performance results(including commissions) for the iShares MSCI Emerging Markets ETF (EEM) transactions would be as follows:
Stock Purchase Cost: $21,663.95
= ($43.31*500+$8.95 commission)

Net Profit:
(a) Options Income: +$614.60
= ($.78+$.50)*500 shares - 2*$12.70 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (If equity price unchanged at $42.20): -$563.95
+($42.20-$43.31)*500 - $8.95 commissions
(c) Capital Appreciation (If EEM assigned at $43.00): -$163.95
+($43.00-$43.31)*500 - $8.95 commissions

Total Net Profit(If price unchanged at $43.31 at May2012 expiration): +$50.65
= (+$614.60 +$0.00 -$563.95)
Total Net Profit(If equity assigned at $43.00 at May2012 expiration): +$450.65
= (+$614.60 +$0.00 -$163.95)

1. Absolute Return (If EEM price unchanged at $42.20 upon May2012 expiration): +0.2% = +$50.65/$21,663.95
Annualized Return (If stock price unchanged at May2012 expiration): +1.4%
= (+$50.65/$21,663.95)*(365/60 days)
2. Absolute Return (If EEM equity assigned at $43.00 at May2012 expiration): +2.1% = +$450.65/$21,663.95
Annualized Return (If EEM assigned upon expiration): +12.7%
= (+$450.65/$21,663.95)*(365/60 days)


7. Mylan Inc.(MYL) -- Continuation
The transactions were as follows:
03/07/2012 Bought 500 Mylan Inc. Shares @ $22.51
03/08/2012 Sold 5 MYL Mar2012 $23.00 Calls @ $.26
Note: the price of Mylan was $22.75 today when the calls were sold.
03/18/2012 Mar2012 options expired.
03/19/2012 Sold 5 MYL Apr2012 $23.00 Calls @ $.47
Note: the price of MYL was $22.73 when these options were sold.
04/22/2012 MYL May2012 Call options expired.
04/25/2012 Sold 5 MYL May2012 $23.00 Calls at $.30
Note: the price of MYL was $22.20 when these call options were sold.

Two possible overall performance results(including commissions) for the Mylan Inc.(MYL) transactions would be as follows:
Stock Purchase Cost: $11,263.95
= ($22.51*500+$8.95 commission)

Net Profit:
(a) Options Income: +$476.90
= ($.26+$.47+$.30)*500 shares - 3*$12.70 commissions
(b) Dividend Income: $0.00
(c) Capital Appreciation (If stock price unchanged at $22.20): -$163.95
+($22.20-$22.51)*500 - $8.95 commissions
(c) Capital Appreciation (If stock assigned at $23.00): +$236.05
+($23.00-$22.51)*500 - $8.95 commissions

Total Net Profit(If stock price unchanged at $22.20 upon May2012 expiration): +$312.95 = (+$476.90 +$0.00 -$163.95)
Total Net Profit(If stock assigned at $23.00 at May2012 expiration): +$712.95
= (+$476.90 +$0.00 +$236.05)

1. Absolute Return (If stock price unchanged at $22.20 upon May2012 expiration): +2.8% = +$312.95/$11,263.95
Annualized Return (If stock price unchanged at May2012 expiration): +13.7%
= (+$312.95/$11,263.95)*(365/74 days)

2. Absolute Return (If stock assigned at $23.00 upon May2012 expiration): +6.3%
= +$712.95/$11,263.95
Annualized Return (If stock assigned at May2012 expiration): +31.2%
= (+$712.95/$11,263.95)*(365/74 days)3. Halliburton Co.(HAL) -- Continuation


8. Market Vectors Russia ETF(RSX) -- Continuation
The transactions history is as follows:
03/23/2012 Bought 300 RSX @ $30.85
03/23/2012 Sold 3 RSX Apr2012 $31.00 Calls @ $1.10
Note: the price of RSX was $30.95 these call options were sold.
04/22/2012 RSX Apr2012 Call options expired.
04/25/2012 Sold 3 RSX May2012 $31.00 Calls at $.35
Note: the price of RSX was $29.72 when these call options were sold.

Although there are unlimited outcomes, two possible overall performance results(including commissions) for this Market Vectors Russia Index ETF (RSX) position are as follows:
Stock Purchase Cost: $9,263.95
= ($30.85*300 + $8.95 commission)
Net Profit:
(a) Options Income: +$412.60
= ($1.10+$.35)*300 shares - 2*$11.20 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (If price of RSX is unchanged at $29.72): -$347.95
= ($29.72-$30.85)*300 - $8.95 commissions
(c) Capital Appreciation (If RSX above $31.00 at May2012 expiration): +$36.05
+($31.00-$30.85)*300 - $8.95 commissions

Total Net Profit(If RSX unchanged at $29.72): +$64.65
= (+$412.60 +$0.00 -$347.95)
Total Net Profit(If RSX above $31.00 at May2012 options expiration): +$448.65
= (+$412.60 +$0.00 +$36.05)

1. Absolute Return if Unchanged at $29.72 upon May2012 expiration: +0.7%
= +$64.65/$9,263.95
Annualized Return If Unchanged (ARIU): +4.4%
= (+$64.65/$9,263.95)*(365/58 days)

2. Absolute Return (If RSX above $31.00 at May2012 options expiration): +4.8%
= +$448.65/$9,263.95
Annualized Return (If RSX above $31.00 at expiration): +30.5%
= (+$448.65/$9,263.95)*(365/58 days)