Tuesday, July 20, 2010

Cash Flow Through Covered Call Options

Explosive Passive Income myhappyassets.com
Below you will find the details of actual covered call transactions our company has invested in. Although we cannot guarantee individual results, there is great opportunity to deliver substantial passive income through covered calls. I highly encourage you to invest in your education on covered calls before leaping in. My Happy Assets provides essential information.
Some explanation: the far left-hand column is the date the transaction was entered in. The Actions represent Bought the stock, Sold the Call and then Called away. The 4th column represents the stock price paid and the premium received.
Remember, one option contract represents 100 shares so in the first example of FSLR, multiply column 4 by 100 to get the Total Amt. column. As you can see, the premium received for this call was $1,533 for 2 months for a monthly cash on cash return of 6.4% or an annualized return of 77%.
The bottom line is that this transaction led to $767 in monthly cash flow.

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This last transaction for ICF, Ishares Realty is a closed transaction that we were called out on. (the buyer of the called the stock before the strike expiration date.) You can see that the inital transaction generated a 2% monthly return, 28% annualized and $221 a month in cash flow. The buyer called us out in March and the stock was sold for the strike price of $52 for a 2 month return of 14% annualized to 82%.
Now again, results cannot be guaranteed but these are real transactions. Again, we highly encourage you to invest time in learning about covered calls and all of the risks associated with this type of investment ... My Happy Assets is a great starting point ... click here to order.

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