Tuesday, September 25, 2012


There has been talk in the media that many companies will be issuing special dividends before year end to avoid the possible Fiscal Cliff raising of the dividend tax. This can be good or bad, for DITM, depending on the size and nature. As we found out awhile back, sometimes it can affect the option price as well - if not, the extra dividend comes out of the part that you "pre-sold" by the ITM call!!
Also, the DIA, while not paying much, pays higher dividends in Nov., Dec. due to which stocks of the Dow 30 go ex then.
I'm looking also at JPM - A rated by Schwab, only less than 3%, but nice call premium.
For a real flyer, check out ALSK, going ex tmrow. risky (don't try with milk money) but looks oversold.

Monday, September 24, 2012


Back from another vacation, I found three stocks (ETFs) called away - at, below, and above average returns:
Iron Mountain (IRM) was a short hold, which had a warning by Barron's, so glad to see it go - Bought last June at $6709 (with comm.), received 1 dividend $54, ITM call premium was $758, stock called at $5991 -net only $94, or 5.60% annualized at the three months return.
SDY, the dividend ETF was better at $10847 cost, $90, $778, and $10,191 returns (see above) for $212 net, or 7.82% ann.
The home run, including a sold put last Jan., was SCCO. which is better since it was 8 months term - 16.96% ann., with put premium included. These are more frequent than losses, so help to mitigate any possible losses.

Monday, September 17, 2012


Just as I was about to take a rare loss in VALE SA - the stock I recommended in a talk to the SF Options Group last Spring - industrial commodities and Vale did a turnaround after a 50% drop. I considered letting my Sept. 20 call expire 0, then noticed it is giving an October dividend, so I rolled out to Dec. to capture it, plus nice premium. Results YTBD.

Since I am going out of town before expiry this weekend, I also rolled out my KKR, took a DITM flyer on PGH (monthly dividends), PWE, and a low yielding DIA...

Tuesday, September 4, 2012


Recharged after a fantastic seaside vacation, I came home to find my vacation paid for by a couple 10% (annualized) takeaways:
MAT - Mattel Inc. was called away by its Oct.20 29-strike call on Aug. 24. for a 10.92% return.
STX -Seagate, which has a nice call premium, was called away in early August for a 16.45% annualized sum. (Correction - in a previous post I erred in the net profit - not 23% as stated!).
SDRL - Seadrill was just called this weekend, as with the others - the day before ex-dividend date. SDRL was an unusual ROLLUP with a special dividend, going back 9 months. It was called away ABOVE my Buy price for a 10.13% yield.

With a positive year end anticipated, I am ready to reinvest fully is some great DITM stocks.