Thursday, December 20, 2012

Rolled SPY Covered Calls

The Index Covered Call Trading Plan  (aka: ICC) is CCI's approach for managing a position of index ETFs and related covered calls.  The most recent trade against this plan is described below.  A reader can find details about the rational and management of the trades at the ICC trading plan tab on CCI's home page.


TRANSACTION TYPE: Roll the December $143 call to the January $147 call
TRANSACTION RATIONALE: With only two days until expiration and SPY trading above the Dec strike price it was time to roll this position.   The December option trade took a small  which partially offset the unrealized gain in the underlying (i.e. this strategy makes less when the market goes up)

TRANSACTION DATE: Thurs Dec 20, 2012

Action: Buy to Close
Exp. Date: Dec 22, 2012
Strike: $143
Price: $1.91
Action: Sell to Open
Exp. Date Jan 19,2013
Strike: $147
Price: $1.06
Net debit: $.85

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