Friday, April 5, 2013

Rolled EEM Covered Call Out and Dow

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. 

DESCRIPTION: iShares Emerging Market Shares
TRANSACTION TYPE: Roll - Emerging market stocks fell this week.  Hence, the current covered call was essentially worthless and it was time to roll out and down the EEM covered call position as described below.

Action: Buy to Close 
Exp Date: April 12, 2013
Strike: $43.00 
Price: $.02
Action: Sell to Open  
Exp. Date: Apr. 26, 2013 (two weeks out
Strike: $42.00 
Price: $.28
Net Credit/contract: $.25 after commissions

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