January 25th, 2012 at 11:42 am
On Monday, 1/23/12, I bought 100 shares of NVDA at $14.58 to add to and average down my existing 200 shares. I then sold 3 NVDA Jun 12 $18 Covered Calls for a net deposit of $115.72 in an IRA account. My basis for these NVDA shares is now $21.59. This transaction represents a simple return of about 1.75% and an annualized return of about 4.42% on my prior, averaged down basis.
NVDA has been bouncing around the $15 level since basically last October. I could probably have sold a lower strike price but decided to sell the $18 strike and go a little further out.
S&P has a 12-month target of $19 and a Hold recommendation for NVDA. MarketEdge has a price opinion of only $14.22 and a Neutral recommendation. NVDA has had a 52-week high of $26.17 and a low of $11.47, which helped me, decide to pick the $18 strike. The 29 Yahoo Analysts have a 12-month price target of $17.39 with a recommendation of 2.5 where 1.0 is a Strong Buy and 5.0 is a Strong Sell.
One day I will let NVDA be called away from me and be done with it. It does not pay a dividend and I normally do not get sufficient option premiums from it to like it for that reason. For now I continue to hold the stock and sell Covered Calls and am currently a little optimistic that I may actually be able to sell NVDA at a profit one day. Six months ago I was of the opinion that it was dead money and that I should let it be called away sooner at a lower strike price and redeploy the money in a better returning investment.
October 3rd, 2011 at 12:41 pm
Today, 10/3/11, I BTC 2 NVDA Jan12 $17.50 Covered Calls and STO 2 NVDA Jan12 $15.00 Covered Calls for a net deposit of $76.97 in an IRA account. My basis for these NVDA shares is now 25.67. This transaction represents a simple return of about 1.48% and an annualized return of about 4.38% on my prior basis.
NVDA is falling with the rest of the market which has allowed me to roll down the strike price and capture some additional option premium. This is the time of year when tech stocks normally rise in value but they are not cooperating at the moment. It may be that I will need to roll NVDA our and hopefully up if NVDA starts to turn up in a significant way. Time will tell. NVDA is big in the mobile computing arena so the upcoming APPL product announcements may cause it to begin moving back up again. I’ll need to keep an eye on it so it does not get too far away from me if that turns out to be the case.
S&P a 12 month target of $19, up from an earlier $13 for NVDA with a hold recommendation. MarketEdge has a price opinion of $15.46, up from an earlier $10.55 with a Long recommendation. NVDA has had a 52 week high of $26.17 and a low of $10.38 which is a higher band than the last time I noted its range earlier this year. The 28 Yahoo! Finance analysts have a $18.26 12 month price target, up from an earlier $14.42 with a range of $11 to $40. It is trading at $11.85 as I write this.
One day I will let NVDA be called away from me and be done with it. It does not pay a dividend and I do not get sufficient option premiums from it to like it for that reason. For now I continue to hold the stock and sell Covered Calls and am currently a little optimistic that I may actually be able to sell NVDA at a profit one day. A year ago I was of the opinion that it was dead money and that I should let it be called away sooner at a lower strike price and redeploy the money in a better returning investment.
January 10th, 2011 at 1:18 pm
Today, 1/10/11, I BTC 2 NVDA Jan11 16 Covered Calls and STO 2 Jan12 NVDA Covered Calls for a net deposit of $160.94 in an IRA account. My basis for these NVDA shares is now 26.06. This transaction represents a simple return of about 2.37% and an annualized return of about 2.24% on my prior basis. In addition to the current cash flow, this transaction also raises my strike price by $1.50. Including the increased strike my potential returns if called are now a simple return of about 7.99% and an annualized return of about 7.53%. Of course, I would still be losing money on the entire chain of trades.
NVDA is rising faster and farther than I expected. Apparently it is rising farther that the analysts expect also.
S&P continues to have a 12 month target of $13 for NVDA. MarketEdge has a price opinion of only $10.55 but it was formed way back in September 2010. NVDA has had a 52 week high of 18.96 and a low of 8.65. Yahoo! Finance analysts only have a $14.42 12 month price target with a range of $9 to $24. It is trading at $20.45 as I write this. It had a lot of resistance near 18 during the Feb through May 2010 months but had drifted lower since then, except for lately when it has been moving up quite sharply since the first of the year.
One day I will let NVDA be called away from me and be done with it. It does not pay a dividend and I do not get sufficient option premiums from it to like it for that reason. For now I continue to hold the stock and sell Covered Calls and am currently a little optimistic that I may actually be able to sell NVDA at a profit one day. Six months ago I was of the opinion that it was dead money and that I should let it be called away sooner at a lower strike price and redeploy the money in a better returning investment.
