February 22nd, 2010 at 2:17 pm
Many of the stocks that I own and write Covered Calls upon also pay dividends. Dividends happen on a regular basis and add significantly to my annual investment income. Year to date I have received a total of $960.53 in dividends in my various accounts for 2010.
I have recently received notice of the following dividends paid in various IRA accounts for a total of $97.00:
This quarter marks the return of FCX dividends for the first time since October 2008. The dividend is not near the prior levels of around .50 per quarter but is a positive sign nevertheless.
I use my basis per share, excluding dividends, to determine the simple and annualized percentage return because I feel that it gives me a better representation of the value of the dividends as they relate to my portfolio. My basis may be above or below the market price which causes my return to be lower or higher than published yields for a stock.
February 6th, 2010 at 4:33 pm
On 2/3/10, I sold 2 BMY Mar10 24 Puts for a net deposit of $108.46 in an IRA account. If Put to me my basis for these BMY shares would be 23.46.
I have 200 other BMY shares with Covered Calls on them at 27, expiring in Mar10. If these Puts are assigned to me they would average down my basis for BMY by about $1. Not sure if I’ll get them though, BMY is only .03 below my strike price and has been holding up pretty well over the past couple of weeks.
BMY pays a decent dividend of .32 per quarter which equates to about a 5.3% annualized yield. It is one of the stocks that I want to continue to acquire on weakness. I consider it part of my core holdings for the dividend and option premiums that I derive from it.
January 28th, 2010 at 9:18 pm
On 1/19/2010, I sold 2 BMY Mar10 27 Covered Calls for a net deposit of $64.46 in an IRA account. My basis for these BMY shares is now 24.45, less any dividends received.
BMY is one of my core stocks. It pays a good dividend of .32 per quarter, up from .31 in the previous quarter. You may remember that I had some BMY shares that were called away on the must own date last November. I hated that because my basis was so low on those shares. Anyway, I bought shares again the next trading day and began selling Covered Calls again on the stock. I’m not in as good a position as I was with my previous shares but am still happy owning BMY at this basis.
