On 7/31/08, I BTC 10 LVLT Sep09 5 Puts and STO 10 LVLT Jan10 Puts for a net deposit of $569.00 in my taxable account.  My basis on LVLT would now be 3.84 if LVLT is put to me.  It closed today at 3.11, has been as high as 4.50 in the past two months and above 3.50 several times in the past two months.

I don’t really want to own LVLT especially in my taxable account which I am working at improving my cash to possible liability ratio.  I thought about rolling out to the Jan09 5 Puts but decided to just get as much cash as I could on this transaction.  It is just possible that I could make some money when my LVLT trades are all said and done, or at least break even.  It doesn’t appear as if additional options for LVLT will be offered after Jan10 so, unless that changes, I will need the stock to move up if I end up with it.

On 7/21/08, I BTC 2 GM Sep08 25 Calls and STO 2 GM Dec08 25 Calls for a net deposit of $121.00 in my taxable account.

The Sep08 GM Puts may have turned out okay but I was feeling more than a little vulnerable with the potential assignments in my taxable account so wanted to generate some additional cash to help mitigate the problem if I start getting assigned.  I would now own these GM shares at 20.76 if assigned.

I am still underwater in 3 other stocks in my taxable account (DSX, LVLT and RIO) which I may look to roll out also.  All of these stock are up right now though.  As they move up I feel less vulnerable.  LVLT in particular is a stock I don’t really want to own though.  I would really be okay if I was assigned the other two but would still prefer not to be assigned if possible.

One more thought in GM.  Some of the incentive for me to own GM is now gone since GM suspended the dividend.  The option premiums are still okay but the total return is now less.

On Monday, 5/19/08, I BTC 10 LVLT Jun08 5 Puts and BTC 10 LVLT Sep08 5 Puts for a net deposit of $159.01 in my taxable account.

This trade allowed me to lock in $218.99 from the prior Put sale (which was also a roll out) because LVLT has risen in value some and because the time value of my Jun08 Puts had eroded.  I see that some of the analysts that follow LVLT have raised their recommendationsto market perform.  I originally got involved with this stock based upon a Jim Cramer recommendation.  If I remember correctly, Jim still thinks that LVLT is below where it should be.  However, it does not really match my current model so if it ever expires worthless I will probably not get involved with it again.  If I should get assigned, I will probably hold it and sell Covered Calls for as long as I can.