Today I sold 200 GGC shares for a net deposit of $502.00 in my taxable account. My basis for these GGC shares is 17.40.
These shares were assigned to me last week. GGC suspended paying its dividends last month (September) so that is a disincentive to continue holding it. Even with that I would have continued to hold it and sell Covered Calls if I had not wanted to raise additional cash in my taxable account as noted in my earlier post on ENT.
This morning I was assigned 3 GGC Jan09 20 Puts in my taxable account and an IRA account.
I also received the expect margin call in my taxable account last night. I will wire an additional $10,000 to e*Trade later today.
I sold 1 GGC Nov08 5 Covered Call in the IRA account for an embarrassingly small net deposit of $1.25. My basis for these GGC shares is now 17.39. I also own 800 other shares in this account with Calls that will expire in Oct08.
I tried to sell 2 GGC Nov08 5 Covered Calls in my taxable account but was denied the transaction because of the margin call. I would have thought that I could have sold something but I guess because of the way the accounting works the option shows up as a negative value and the account cannot support any additional negative values until I wire the funds. So, I’ll just sell the options tomorrow. Who knows, maybe GGC will be up a little more tomorrow (it’s up some today) and I can get a better premium.
And, with this post, I am once again caught up with my trading transactions.
On 8/18/08 I sold 11 GGC Oct08 5 Covered Calls for a net deposit of $140.75 in an IRA account and my taxable account. On 8/20/08 I sold 3 GGC Nov08 5 Covered Calls in my taxable account for a net deposit of $34.75. My basis for these GGC shares now ranges from17.28 to 18.96.
GGC does pay a dividend so it fits part of my general investing philosophy. Even so, I don’t think much of GGC. They just cannot seem to get it together. Part of their problem though is related to the housing market and I think the price of oil. A large segment of their business includes vinyl based building and home improvement products. I also understand that they carry a very heavy debt load.
Even so, I am following my regular game plan of chipping away at my basis by selling covered calls until GGC is called away at a profit for me or I am happy to continue owning it and selling calls at my basis.
