Monday, November 7, 2011

Rolled Intel Covered Calls Out and Up

Frequent readers know that CCI is bullish on Intel.  (recent article here).   Readers will also recall that back in October CCI had sold one lot of Nov $24 calls to provide a modest amount of downside protection through the earnings season.  With Intel trading below $24 this morning we bought this call back.  The trade had an immaterial gain, but I prefer to think of it as some small amount of insurance against an earning miss was held for no-cost.

When Intel bounced back towards $20.20 this afternoon, CCI re-established the covered call on one lot of stock via the $25 Dec calls for $.43 after commission.  This allows my bullish thesis a little more room to run but re-establishes  a little income/protection if by some "slim chance" my bullish thesis in Intel is wrong.

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