Re-established Short Call in C

As discussed here CCI has a long position in the financial sector etf (xlf) via the Jan 15 $10 Call, that has usually been hedged via a shorter duration short call in Citigroup (C).

With D.C. dominating the news, CCI decided to re-establish a short call in Citigroup as a hedge against the long position in XLF held in the portfolio. Specifically, on Monday CCI sold the Nov 1 $52 call at $.32.

Since inception on Jan 8, the performance of various potential holdings  as of the close of trading today are shown below

• The XLF etf  is still up 19.4%! (including dividends)
• The leverage obtained by instead simply holding the Jan 15 $10 call would have returned 45.2%.
• The leveraged, long/short strategy defined in this thread is up 43.6%. (i.e the short call has not been very much of a drag on the leveraged gain while providing a modest hedge for down moves)

Note: C reported earnings and they did not seem to push the stock higher. This reduces the volatility/risk of the short call. As the price of the option decays look for CCI to close or roll this position relatively soon.