Another stock I used for covered call writing in my portfolio was Demand Media (DMD). You can see the previous trades here.
As you can see I opened the first covered call in December last year. The trade didn’t go as well as I would expect (the stock wasn’t called away), so I bought back almost worthless covered call and sold a new one. Since then the trade progressed in my favor and brought 11.24% gain as of the last Friday (31.60% annualized return).
Since the last covered call expired worthless this morning I could sell another covered call against this stock, generate more income, and improve overall trade.
This morning I sold another covered call:
05/20/2013 09:30:02 Sold 1 DMD Nov 16 2013 10.0 Call @ 1.2
|Own 100 shares DMD:||$9.50|
|Sold 1 Covered Call:||$1.20|
|Expected Option Assignment:||$1000.00|
|Option Assignment Fee:||$19.00|
|Expected Net Gain:||$229.69|
This trade added to my overall income generated in May 2013 to be $220 so far. This helped me to meet and maintain my goal to generate monthly at least $100 thru options trading. If this trend continues I should be able to exceed my goal.
How are you generating income from your investments?