Initial Transaction - Lockheed Martin (LMT) (8/25/2009)

To continue my recent ex-dividend date CC strategy, I opened a position in Lockheed-Martin (LMT) an aerospace defense contractor. Lockheed took quite a hit in July after releasing disappointing earnings, and has been stuck around $75 since then. The stock sports a nice 3% dividend and is not generally considered very volatile. The ex-dividend date is a few days after the purchase date, and could present a nice return if called. The new profit/loss info is below:

8/25/2009 -- Bought 100 LMT @ 74.30
8/25/2009 -- Sold To Open 1 LMT September $75 Call @ 1.30

The important purchase metrics are below for insight into possible profit and loss (these all include commissions):
Cost Basis: 7300.00

Potential Gain If Called At Ex-Div Date: 2.62%
Potential Annualized Gain If Called At Ex-Div Date: 319.31%

Potential Gain If Called At Expiration: 3.52%
PotentialAnnualized Gain If Called At Expiration: 51.40%

Dividend Payment - McGraw-Hill (MHP) (8/24/2009)

For better or worse, MHP was not ITM at close the day before its ex-dividend date. As such the position was not called away, and the dividend was paid. The new profit/loss info is below:

8/21/2009 -- Bought 100 MHP @ 29.66
8/21/2009 -- Sold To Open 1 MHP September $30 Call @ 0.86
8/24/2009 -- Dividend @ 0.23

The important purchase metrics are below for insight into possible profit and loss (these all include commissions):
Cost Basis: 2890.00

Potential Gain If Called At Expiration: 4.57%
PotentialAnnualized Gain If Called At Expiration: 57.49%

Update Transaction - United States Natural Gas (UNG) (8/24/2009)

In what I think is considered by most to be a continued fall of natural gas prices, UNG has become quite the laggard in the CCIP portfolio. On top of the horrible performance of natural gas prices, UNG itself is creating issues by its inability to offer new shares. This is actually a good thing in the short term because it keeps the price of UNG somewhat boosted above actual natural gas prices. Unfortunately, this also creates the possibility that if UNG is able to offer new shares, the ETF could fall 15% to make up for its current premium to NAV. As such, I have adopted a strategy of simply trying to gain as much option premium in the mean time. I expect to be stuck in this position for at least 6 months. The performance metrics are below:

7/2/2009 -- Sold To Open 1 UNG August $13 Put @ 1.15
8/21/2009 -- Stock Purchase @ $13
8/24/2009 -- Sold To Open 1 UNG October $13 Call @ 0.60


The important purchase metrics are below for insight into possible profit and loss (these all include commissions):
Purchase Price: $1190.00

Possible Max Upside: 15.04%

Annualized Max Upside: 51.32%

Initial Transaction - Intel (INTC) (8/24/2009)

This position is along the same lines as the position I recently opened in ConocoPhilips. The purpose is not necessarily to provide giant annualized gains (i.e. 50%+) as other positions in the past have, but instead it is intended to provide quality downside coverage, a possible dividend to enhance returns, and a return which would be considered more than enough by many. This position is in Intel, which I have held before in the portfolio, and has been relatively stagnant since I exited the position after they crushed earnings a couple months ago. The profit/loss info is below:

8/24/2009 -- Bought 100 INTC @ 18.92
8/24/2009 -- Sold To Open 1 INTC October $18 Call @ 1.50

The important purchase metrics are below for insight into possible profit and loss (these all include commissions):
Cost Basis: $1747.00

Potential Annualized Gain If Called At Expiration (10/17/2009): 17.15%

Downside Protection: 7.9%

Initial Transaction - SPY Call (8/24/2009)

This is part of a new strategy I am enlisting in what is essentially becoming less like a strictly covered call portfolio and more like a hedge fund. But the focus will remain substantially on covered calls. This position is an attempt to deal with an issue that affects most covered calls portfolios, which is the inability to perform as well as the overall market, when the market is rising a substantial amount (more than 4-5%) a month. I feel that the covered call portfolio has and will perform well when the market is decreasing, but it requires a little "pick me up" when the market is on a tear. In order to counter this, I have purchased 1 SPY (an ETF which tracks the S&P 500) call about 4% OTM, in order to give myself additional upside if the market continues its rise, but only risk about .33% of my total portfolio on this endeavor. If the market does not rise more than 4%, stays flat or falls, I only lose about $150. If on the other hand, the market goes up 6% in the month, I will enhance my returns. The purchase info is below:

8/24/2009 -- Bought 1 $106 SPY September Call @ 1.35

Update Transaction - Intrepid Potash (IPI) (8/24/2009)

Intrepid Potash has stayed in a relatively tight range since I purchase it at the end of July. Earnings were in line with expectations and they had no real impact on the share price. It is important to note though that IPI has not participated in the overall market gains for the month of august. Due to the longer time period until expiration, I was able to sell a $28 Call as opposed to $27 like the previous month, and still get about a 3% premium. The performance metrics are below:

7/30/2009 -- Bought 100 IPI @ 26.70
7/30/2009 -- Sold To Open 1 IPI $27 August Call @ 1.54
7/30/2009 -- Bought To Open 1 IPI $22 August Put @ 0.45
8/21/2009 -- Call Expired
8/24/2009 -- Sold To Open 1 IPI $28 September Call @ 0.7


The important purchase metrics are below for insight into possible profit and loss (these all include commissions):
Stock Purchase Cost: $2561.00
Current Cost Average: $24.91

Downside Coverage (from current price of $26.27): 5.17%
Possible Max Upside: 12.28%

Annualized Max Upside: 87.90%

Update Transaction - AT&T (T) (8-24-2009)

As the last 100 shares of AT&T in my portfolio managed to not be called away on friday, I quickly sold another $26 covered call resulting in a guaranteed 2% gain for the next month for this position. I will not re-enter this position as a monthly covered call position in the future, though I may as part of my longer term covered call strategy. The new profit/loss info is below:

Transaction History:
Various -- Bought 100 T @ 25.125
2/25/2009 -- Sold To Open 1 T March $24 Call @ 0.895
3/6/2009 -- Bought To Close 1 T March $24 Call @ 0.3874
4/7/2009 -- Dividend @ 0.41
4/16/2009 -- Sold To Open 1 T May $26 Call @ 0.8126
5/15/2009 -- Call Expired
7/8/2009 -- Dividend @ 0.41
7/23/2009 -- Sold To Open 1 T August $26 Call @ 0.4
8/21/2009 -- Call Expired OTM
8/24/2009 -- Sold To Open 1 TSeptember $26 Call @ 0.53


The important purchase metrics are below for insight into possible profit and loss (these all include commissions):
Stock Purchase Cost: $2512.50
Current Cost Average: $22.05


Downside Coverage (based on current share price, 26.00): 15.2%
Possible Max Upside: 16.28%

Annualized Max Upside: 28.85%