An initial position in BMY was established on April 6, 2009. This position was established with funds gained by closing other covered call positions early, which had become so much in the money that time premium had essentially gone away. This particular purchase was made to add more diversification to the portfolio. Additionally, it is my opinion that BMY is a relatively safe play in comparison to some of the other pieces in the portfolio, and also sports a 6% yield. So although the return may not be the 20-30% of some other parts of the portfolio, it is also much less risky.
4/6/2009 -- Bought 100 BMY @ 20.48
4/6/2009 -- Sold To Open 1 BMY April $21 Call @ .34
The important purchase metrics are below for insight into possible profit and loss (these all include commissions):
Stock Purchase Cost: $2048.00
Downside Coverage: 1.66%
Possible Max Upside: 4.05%
Annualized Max Upside: 134.28%
Monday, April 6, 2009
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