PowerOptions weblog identified several successful trades for the option expiration month of November. Below is a table showing some of the successful trades identified with a link to the corresponding article.
The weblog posts for the closed positions were published between the 24th and 30th of October. The stock options for all of these positions expired on the 18th of November.
| Covered Calls Successes | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock | Option | % Return |
Article | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| CROX | CQJKH | 12.00% | Crocs Shoes – Hideous Footwear or Profit Machine | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| DPTR | QHRKE | 4.40% | Delta Petro. Corp. – Covered Calls | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BBW | BBWKF | 4.50% | Politics and Options Investing | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| XOM | XOMKO | 2.25% | Politics and Options Investing | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The companies identified in chart above are:
1) Crocs (CROX) – the manufacturer of the unique sponge-like footwear.
2) Delta Petroleum Corporation (DPTR) – explore and develop natural gas and oil reserves worldwide.
3) Build-a-Bear Workshop (BBW) – persons with a child under five or who have been to an American mall in the last 10 years you will undoubtedly have seen this business.
4) Exxon Mobil Corp. (XOM) – see Exxon’s CEO Lee Raymond’s Wikipedia entry: ( wikipedia ).
We still consider these companies to be attractive for a covered calls stock options strategy. We will search for covered calls stock options positions for these companies with stock options expiring in January.
Using PowerOptions powerful option search engine we can identify the most attractive covered calls stock options trades for these companies for the month of January:
| Covered Call for January 2007 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock Sym |
OPTION | Expiration &Strike |
Opt. Bid |
%Dnsd. Prot |
%If Unch. |
%If Asgnd |
Stock Price |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| CROX | CQJAI | 07 JAN 45.00 | $2.15 | 5.00% | 5.30% | 11.20% | $42.60 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| DPTR | QHRAF | 07 JAN 30.00 | $3.10 | 10.70% | 11.90% | 15.40% | $29.10 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BBW | BBWAF | 07 JAN 30.00 | $1.85 | 6.10% | 5.20% | 5.20% | $30.37 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| XOM | XOMAX | 07 JAN 72.50 | $1.85 | 4.40% | 2.30% | 2.30% | $74.16 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The potential returns range from 2.3% for XOM to 15.4% for DPTR. The XOM and BBW positions are in-the-money [ITM] and the DPTR and CROX positions are out-of-the-money [OTM]. OTM covered calls positions require the stock price to appreciate in order to realize the maximum return. Generally, OTM covered calls positions exhibit larger potential returns with less downside protection and ITM covered calls positions exhibit less potential returns with greater downside protection. The ability to manage risk with OTM/ITM is one of the beauties of the covered calls stock options strategy.
The identification of the past successful trades and the potentially future successful trades is solely a result of the powerful and flexible search engine of the PowerOptions website.
You can also reap the benefits of the PowerOptions website for free by signing up for PowerOptions’ free 14 day trial. PowerOptions also guarantees success – if you do not make at least five times your power options monthly fee each month, PowerOptions will give you the next month free.
PowerOptions provides Internet based tools for analyzing stock options with specific search criteria and for finding potentially lucrative option income. If you are seeking to execute a covered call investment strategy for your personal portfolio, PowerOptions provides an Internet based search engine to help you identify covered call option positions.
PowerOptions’ sister company PowerOptionsApplied provides expert stock option trading recommendations. PowerOptionsApplied specializes in covered call, naked put and iron condor stock options strategy recommendations. PowerOptionsApplied provides a 30-day risk free trial of its service.
[tags]weblog, Lee Raymond, Wikipedia, BBW, Build-A-Bear Workshop Inc., CROX, Crocs Inc., DPTR, Delta Petroleum Corp., XOM, Exxon Mobil Corp., covered call investment strategy, investment strategy, iron condor, option income, poweroptions, stock option trading, stock options[/tags]