On 11/24/09, I BTC 2 MO Dec09 19 Covered Calls and STO 2 MO Jan11 20 Covered Calls for a net deposit of $64.99 in an IRA account.  My basis for these MO shares is now 35.48, excluding dividends received.

I am underwater so, of course, do not want these MO shares called away.  Beyond that, I like MO for the dividends.  Mo, raised it dividend last quarter to .34 from .32 per share.  That is 7.23% on the current price but only 3.8% on my basis as of the last payout.

I rolled out to the Jan11 Covered Call because I wanted to increase the strike price and do so with a cash positive transaction.  I could only increase the strike to $20 without going out to Jan12 which I did not want to do.  At the time I made the trade I was concerned that MO would continue it price increase (which it was doing at the time) and that MO would be in jeopardy of being called away in Dec09.

Mo is dropping in price now and I may need to either outright buy some more or sell some Puts on it and be happy to take an assignment below the 18.81 that it close at today.