This is the next in a continuing series of Covered Call transactions on FCX shares that I purchased and upon which I am selling Covered Calls with the intent that they be called away.  In this case, I acquired these FCX shares when my Apr12 $38 Put was assigned to me.  I decided to sell the $39 Call to make a little extra when the shares are eventually called away from me.  I would like to be selling weekly Calls but FCX is just not cooperating right now.

These FCX trades have worked quite well for me so far.  The Covered Calls sometimes expire worthless (not my original intent) but FCX is volatile enough that I am confident that I will eventually sell them at a profit. As long as I can continue to sell near term Covered Calls above my acquisition price I do not care if they are ever called away. 

S&P currently has a 12-month price target of $46 on FCX with a Buy recommendation.  MarketEdge continues a price opinion of $38.56 and an Avoid recommendation.  The 19 Yahoo analysts have a 1-year price target of $52.86 and a 1.8 recommendation where 1.0 is a Strong Buy and 5.0 is a Strong Sell.

This is the next in a continuing series of Covered Call transactions on FCX shares that I purchased and upon which I am selling Covered Calls with the intent that they be called away.  In this case, I acquired these FCX shares when my Apr12 $38 Put was assigned to me last weekend.  I decided to sell the $39 Call to make a little extra when the shares are eventually called away from me.  I considered selling the weekly Call expiring this Friday at the $38 strike but ended up deciding on the May option, partly because I used margin to buy this shares and want the extra revenue to help pay for the carrying costs.

These FCX trades have worked quite well for me so far.  The Covered Calls sometimes expire worthless (not my original intent) but FCX is volatile enough that I am confident that I will eventually sell them at a profit. As long as I can continue to sell near term Covered Calls above my acquisition price I do not care if they are ever called away. 

S&P currently has a 12-month price target of $46 on FCX with a Hold recommendation.  MarketEdge continues a price opinion of $38.56 and an Avoid recommendation.  The 19 Yahoo analysts have a 1-year price target of $52.74 and a 1.8 recommendation where 1.0 is a Strong Buy and 5.0 is a Strong Sell.

This is the latest in an occasional series of transactions that I am playing on FCX.  I don’t expect to be assigned these shares but, if I am, I will begin to sell Covered Calls on them with the goal of having them called away at a profit.  I expect that I will be able to sell the weekly Covered Call for this strategy.

These FCX trades have worked quite well for me in the past.  I especially like it when I can sell the weekly Covered Calls that expire worthless.

S&P currently has a 12-month price target of $46 on FCX with a Hold recommendation.  MarketEdge has a price opinion of $38.56 and an Avoid recommendation.  The 19 Yahoo analysts have a 1-year price target of $53.79 and a 1.9 recommendation where 1.0 is a Strong Buy and 5.0 is a Strong Sell.

My YTD dividends are up by $101.20 on a monthly average from last year.  That represents a 12.84% increase to date year over year.  I attribute the increased dividends to a few companies raising their dividends and to my purchasing additional dividend paying stocks.  During February, I received notice of the following dividends paid in various accounts for a total of $687.71.

Div-3-1-12

Please notice that PGF is an ETF and pays dividends monthly.  The annualized dividend yield for PGF is based upon the simple and false assumption that it will pay the same dividend each month for the next 12 months.  The actual annualized dividend yield may be more or less than illustrated here.

I use my basis per share 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.  I calculate my basis per share as my acquisition price less any option premiums received on those shares.  I do not use dividends to reduce my basis.

This is one of those stocks that I am trading in this account to attempt to gather cash faster than my normal methods.  In this case, I had hoped to gather option premiums while selling Covered Calls slightly out of the money with the goal of the stock being called away above my basis allowing me to repeat the cycle with the same or another stock.  Except…in this case FCX did not cooperate and fell a little farther than I wanted…and now is recovering faster than I want.    So I have had to roll the Call out and up again, although still at a strike price below my basis.  I would normally have not been concerned with the stock price above my strike price except that tomorrow is the ex-dividend date for FCX and I did not want this one called away below my basis.  If FCX behaves as in the past I might be able to roll these Calls in and down sometime before Jan14.

S&P continues a 12-month price target of $48 and a Buy rating on FCX.  MarketEdge has a price opinion of $38.87 and now has a Neutral rating, up from an earlier Long.  The 18 Yahoo Analysts have a 12-month price target of $53.17 with a recommendation to 1.8; on a scale where 1.0 is a Strong Buy and 5.0 is a Strong Sell.