As discussed here CCI's last activity in this position was to sell the June $660 call against the Jan $300 call held in the portfolio. Since that time the stock has drifted mostly sideways (slightly up). This week Apple is holding its developer conference. CCI has no particular insight into what this conference might mean to the company or its products. However, these type of events often seem to lend themselves to the old adage "buy on the rumor, sell on the news". In this case, "roll on the news". The intent of rolling this option position was to
- harvest a little of the option premium gained to date
- re-establish a covered call that provides a little more risk protection and reward if the stock were to jump up or down based on the perceived outcome of the conference.
Specifically, CCI closed the June $660 call and rolled out to the July 5 (two weeks further out) $665 call. This transaction was done for a $1.34 credit/contract after commissions. The June $660 call position made a very modest $.61/contract, and the July 5 $665 contract has about $5.70/contract in premium remaining at this time.
If you have been keeping score at home ... Since Mar. 1 when this position was established
- Holding the stock would have resulted in the position being up 4.3% (including dividends)
- Holding the $300 Leap for leverage would have resulted in the position being up 8.0%
- Holding the $300 Leap and rolling calls against that position as described here is up 14.5%