Saturday, 25 April 2015

Sell - Mattel

I was a bit worried with Mattel's dividend payout ratio and didn't want to relive an experience similar to Ensco. So I sold my 100 shares on Friday.

Bought 100 shares Jan 22, 2015 @ $27.28
Sold 100 shares Apr 24, 2015 @ 29.83

Dividends received: $38

My total return over 3 months is 10.7%, including the dividend and net of commissions.

This sale has reduced my yearly dividend income by $152, which now stands at $8,164.15.

Options Trade - Emerson Electric Co

On April 24, I sold a put in Emerson Electric. The trade:

Sold 1 EMR Put Dec 18 '15 $55 Put @ 3.30 ($11.20 commission + $0.01 SEC fee)

Days Held (sell date to expiry): 238

Net Premium: $318.79

Annualized Return = ($318.79 / ($5,500 - $318.79)) * 365/238 = 9.44%

The most likely outcomes of this trade are:

1. Shares are trading above $55.00 at expiration. I will get to keep $318.79 in net premiums.

2. EMR is trading below $55.00 at or before expiration and shares are assigned. I will receive 100 shares of EMR at a net cost of $51.81/share.

I've now have 8 open options; 7 puts and 1 call. 

Wednesday, 22 April 2015

Options Trade - Starbucks

On April 22, I sold a put in Starbucks. The trade:

Sold 1 SBUX Put Jan 15 '16 $45 Put @ 2.25 ($11.20 commission + $0.01 SEC fee)

Days Held (sell date to expiry): 268

Net Premium: $213.79

Annualized Return = ($213.79 / ($4,500 - $213.79)) * 365/268 = 6.79%

The most likely outcomes of this trade are:

1. Shares are trading above $45.00 at expiration. I will get to keep $213.79 in net premiums.

2. SBUX is trading below $45.00 at or before expiration and shares are assigned. I will receive 100 shares of SBUX at a net cost of $42.86/share.

I don't find SBUX shares attractively valued, but everytime I walk into one of their shops, there's a line-up. And that I like.

Visit my Options page to view other trades I've executed but have not written about.

Saturday, 18 April 2015

Options Trade - Rogers Communications

On April 16, I sold a put in Rogers Communications. I own 275 shares at an average cost of $44. I've been waiting patiently for the stock price to dip below $40 in order to average down, but so far I haven't had the opportunity. 

The trade:
Sold 1 RCI.B Put Jan 15 '16 $40 Put @ 2.05 ($11.20 commission)
Days Held (sell date to expiry): 275
Net Premium: $193.80
Annualized Return = ($193.80 / ($4,000 - $193.80)) * 365/275 = 6.76%

The most likely outcomes of this trade are:


1. Shares are trading above $40.00 at expiration. I will get to keep $193.80 in net premiums.

2. RCI.B is trading below $40.00 at or before expiration and shares are assigned. I will receive 100 shares of RCI.B at a net cost of $38.06/share.


My put in GIS and my call in VOD both expired worthless on April 17. That's $257.57 in net premiums that I get to keep. I'll probably sell another call on my VOD shares soon.

Friday, 10 April 2015

New Purchase - Royal Dutch Shell

On April 10, I initiated a position in Royal Dutch Shell (RDS.b).

Number of shares purchased
50
Price per share
$60.45
Commission
$9.95
Total cost per share
$60.65
Total cost
$3,032.95
Annual dividend per share
$3.76
Initial dividend yield
6.20%
Increase in forward 12-month dividends
$188.00

My dividend income is now $8,282.51 per year.

Wednesday, 1 April 2015

Options Trade - Caterpillar

When Caterpillar dipped below $80, it got my attention. But instead of buying the stock outright, I finally decided on selling a put. This put is somewhat unique for me because it's the first time I sold a put above the current share price. The trade:

Sold 1 CAT Put Nov 20 '15 $82.50 Put @ 8.28 ($11.20 commission + $0.02 SEC fee)

Days Held (sell date to expiry): 233

Net Premium: $816.78

Annualized Return = ($816.78 / ($8,250 - $816.78)) * 365/233 = 17.2%


The most likely outcomes of this trade are:

  1. Shares are trading above $82.50 at expiration. I will get to keep $816.78 in net premiums.
  1. CAT is trading below $82.50 at or before expiration and shares are assigned. I will receive 100 shares of CAT at a net cost of $74.33/share.