Stocks and Options » AMD

Advanced Micro Devices, Inc. (AMD) – Rolled Down Jan13 Calls

Bill — Fri, 19 Aug 2011 18:38:07 +0000

Yesterday, 8/19/11, I BTC 2 AMD Jan13 10 Covered Calls and STO 2 Jan13 7.50 Covered Calls for a net deposit of $76.97 cents in my taxable account. My basis for these AMD shares is now 14.88. This transaction represents a simple return of about 2.52% and an annualized return of about 1.77% on my prior basis.

I took advantage of the falling market and AMD in particular to raise some additional cash in this taxable account. It has been a bit of a roller coaster ride this month. Earlier this month I rolled AMD out and up from a Jan12 $9 Call to a Jan13 $10 Call to raise cash because I was anticipating the need to increase my cash position in this account to cover a margin requirement. I no longer anticipate the cash call but am now more aware of the possibilities of making additional money by adjusting expiration dates and/or strike prices. I’ve done that in the past but had let the practice fall away as a strategy. In the case of AMD, I fully expect to be rolling the current Jan13 Calls out and hopefully up if Jan14 LEAPS are posted for it.

Amazingly, S&P continues its 12 month price target of 11.00 and its Hold rating but they have a Poor track record predicting AMD price movement (correct 0% of the time in the past year). Market Edge Second Opinion continues it price opinion of 7.75 and its rating of Neutral with a fair track record predicting AMD price movement (correct 30% of the time). The Yahoo! Finance analysts have a 12 month price target of 8.53, down from a previous 8.63, with a recommendation of 2.5 (1.0 = Buy, 5.0 = Sell).

So, after all that, I will let AMD go just as soon as I can get something more than my basis for it. I probably should let it go now but hope springs eternal and as long as I can continue to sell options on it my return on each transaction will increase as my basis reduces. Also, I don’t need any more losses right now because I have enough from 2008 to last a few more years. How’s that for rationalization.

Advanced Micro Devices, Inc. (AMD) – Rolled Out and Up Jan12 Calls

Bill — Mon, 08 Aug 2011 21:11:00 +0000

Today, 8/8/11, I BTC 2 AMD Jan12 9 Covered Calls and STO 2 Jan12 10 Covered Calls for a net deposit of a whopping $56.97 cents in my taxable account. My basis for these AMD shares is now 15.27. This transaction represents a simple return of 1.83% and an annualized return of 1.26% on my prior basis.

I made these trades in order to raise some additional cash in this taxable account. I am anticipating the need to increase my cash position in this account to cover a margin requirement. Being able to roll the strike up one dollar at a net credit helped me to make the trades. I would have preferred to have rolled the option in and down but there was not enough money in the options to do that just now.

Amazingly, S&P has a 12 month price target of 11.00, up from my last look when it was 9.00, and continues a Hold rating but they have a Poor track record predicting AMD price movement (correct 0% of the time in the past year). Market Edge Second Opinion has a price opinion of 7.75, up from a previous 7.34, and reduced there rating to a Neutral from a previous Long rating on the stock with a fair track record predicting AMD price movement (correct 40% of the time). The Yahoo! Finance analysts have a 12 month price target of 8.63, up from a previous 8.43, with a recommendation of 2.5, up from a previous 3.0, (1.0 = Buy, 5.0 = Sell).

Advanced Micro Devices, Inc. (AMD) – Sold Jan12 Calls

Bill — Thu, 28 Jul 2011 21:14:06 +0000

Today, 7/28/11, I STO 2 Jan12 9 Covered Calls for a net deposit of $82.48 cents in my taxable account. My basis for these AMD shares is now 15.56. This transaction represents a simple return of about 2.58% and an annualized return of about 5.32% on my prior basis.

Even though the stock is down right now I was concerned earlier that I might need to roll the July calls out which would have been a little problematical because of my vacation. As it turned out I was needlessly concerned. The current trade is fifth time I’ve increased my strike price since January of 2009. That is a trend I like.

AMD has been a difficult stock to own. I does not pay a dividend and I am still underwater on the shares. A bullish read on AMD can be found here. A bearish read on AMD can be found here. My opinion is that I will probably not purchase any more AMD, if for no other reason, because it does not pay a dividend which is one of my general criteria for acquiring new stocks. I violate that criteria now and then (witness YHOO) and might do so with AMD if I have the extra cash in this account at the same time that I am either rolling out AMD or selling new calls on it. The purpose of doing so would be to reduce my basis and facilitate having the stock called away at a price over my basis.

S&P currently has a 12 month price target of 11.00, up from a prior 9.00 when I last looked and continues a Hold rating but they have a poor track record predicting AMD price movement (correct 0% of the time in the past year). Market Edge Second Opinion has a price opinion of 7.75, up slightly from the 7.34 that they developed back in November 2010 and have a Neutral rating, up from an Avoid rating on the stock with a fair track record predicting AMD price movement (correct 44% of the time). The Yahoo! Finance analysts have a 12 month price target of 8.63.

Advanced Micro Devices, Inc. (AMD) – Rolled Out and Up Jan11 Calls

Bill — Thu, 20 Jan 2011 03:50:13 +0000

Today, 1/19/11, I BTC 2 AMD Jan11 7.5 Covered Calls and STO 2 Jul11 8 Covered Calls for a net deposit of a whopping $56.95 cents in my taxable account. My basis for these AMD shares is now 15.97. This transaction represents a simple return of 1.75% and an annualized return of 3.23% on my prior basis.

I made these trades because I am currently underwater by a good amount and did not want it called away just yet. Being able to roll the strike up fifty cents at a net credit helped me to make the trades. I also liked that I could do it by only rolling out to July. The last time I rolled it out was way back in September of 2009.

S&P has a 12 month price target of 9.00 and a Hold rating but they have a poor track record predicting AMD price movement (correct 0% of the time in the past year). Market Edge Second Opinion has a price opinion to 7.34 that they developed back in November 2010 and have a Long rating on the stock with a fair track record predicting AMD price movement (correct 42% of the time). The Yahoo! Finance analysts have a 12 month price target of 8.43 with a recommendation of 3.0 (1.0 = Buy, 5.0 = Sell).

Advanced Micro Devices, Inc. (AMD) – Rolled Out Oct09 Calls

Bill — Wed, 30 Sep 2009 18:02:16 +0000

Today I BTC 2 AMD Oct09 5 Covered Calls and STO 2 AMD Jan11 7.50 Covered Calls for a net deposit of $38.99 in my taxable account. My basis for these AMD shares is now 16.26.

AMD has been pretty much moving up since early Mar09. It took a dip down in June and was down under $4 when my prior Covered Calls on it expired that month. It appeared to me that it was going to stay down there or perhaps even fall lower as it has done in the past. Hence, my choosing the Oct09 5 Covered Calls to sell at that time. Now, the story looks a little different with AMD continuing to rise again. I may regret going all the way out to Jan11 to sell the 7.50 strike but I was a little tired of rolling out and up without depositing some additional cash in the process.