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Trade adjustment – Kodiak Oil & Gas Corp (KOG) new covered call

The previous February covered call for Kodiak Oil & Gas Corp expired worthless leaving me with maximum profit of $52 per contract (5.47%; 3% annualized profit). Since the option expired worthless I am allowed to sell another contract against the same stock.

I did sell another covered call this morning and collected another $60 per contract.

TRADE DETAIL

03/18/2013 10:25:02 Sold 1 KOG Sep 21 2013 10.0 Call @ 0.6

This trade adds to the overall performance of the entire trade. You can see the original trade here.

Here are the updated details about this trade if the stock gets called away in September (which is what I want):

 

Own 100 shares KOG: $9.41
Strike: $10.00
Sold 1 Covered Call: $0.60
Total Purchase: $60.00
Commissions: $8.78
Total purchase: $846.56
Expected Option Assignment: $1000.00
Option Assignment Fee: $19.00
Expected Proceeds: $981.00
Expected Net Gain: $134.44
Expected ROI: 15.88%

How do you trade covered calls? Do you trade them at all? If you trade covered calls, do you trade them against stocks you already own or do you trade buy-write, total return trades?

 





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