The following trades all occurred on Monday, 3/19/12:

I sold 4 F Jul12 $14 Covered Calls for a net deposit of $108.94 in an IRA account.  I also sold 1 F Jul12 $14 Covered Call in another IRA account for a net deposit of $23.24.

I sold 2 BALT Sep12 $7.50 Covered Calls for a net deposit of $10.48 in an IRA account.

I sold 2 TIE Sep12 $17 Covered Calls for a net deposit of $70.48 in an IRA account.

I sold 2 VZ Apr12 $40 Covered Calls for a net deposit of $58.48 in an IRA account.

I sold 8 YHOO Jul12 $17 Covered Calls for a net deposit of $329.94 in an IRA account.

The following trade occurred on Tuesday, 3/20/12:

I BTC 1 C Apr12 $34 Covered Call and STO 1 Sep12 $35 Covered Call for a net deposit of $90.49 in an IRA account.

All of the Monday trades, with the exception of the single F trade, were to place new positions on stock whose previous Covered Calls expired worthless last Friday.  The single F Covered Call sale was on some F shares that I had been sitting of waiting for the stock to appreciate.  I finally decided that it was not going to appreciate anytime soon so decided to go ahead and sell the Call.

My C Covered Call was in the money and I just wanted to capture some additional option premium while increasing the strike price by $1.  It is still in the money but I am okay if it is called away because I am profitable at this point.

Jerry Yang’s leaving the company has once again stirred rumors of YHOO being acquired by another party.  I suppose that is possible but I am not hearing any serious comments of the possibility.  The stock has pretty much been drifting sideways since October 2011.  I would have liked to sell the $19 strike once again but decided to sell the $18 strike this time in order not to sell too far into the future.  If something should happen and I am called away prior to March expiration I will be happy with the profit I will have realized.  On the other hand, I have rather enjoyed playing with YHOO and will probably attempt to roll out and up these Calls, if it looks like I might be called away.

YHOO does not pay a dividend so it does not meet my general investment goals.  However, as I suggested above, I am starting to think that I might like to continue owning it to sell the Covered Calls and, in effect, create my own dividend while at the same time decreasing my basis.  As an FYI, I have received a net total of $7,968.40 in option premiums on YHOO going back to 2006.

The 25 YHOO analysts currently have a 12-month price target of $17.74, down from $18.16 in November, with a recommendation of 2.6, down from 2.5, where 1.0 is a Strong Buy and 5.0 is a Strong Sell.  S&P continues a 12-month price target of $20.00 and a Strong Buy recommendation.  MarketEdge has a price opinion of $15.52, up from $14.71 last November, and an Avoid recommendation, down from an earlier Long recommendation.

There are still some rumors of YHOO being a takeover target although I have not heard any comments this past week.  The stock has been drifting down for the past 10 days.  I don’t know what to believe but I decided to go out two months this time to continue selling the $19 strike price at a reasonable level.  If something should happen and I am called away prior to January expiration I will be happy with the profit I will have realized.  On the other hand, I have rather enjoyed playing with YHOO and will probably attempt to roll out and up these Calls, if it looks like I might be called away.

YHOO does not pay a dividend so it does not meet my general investment goals.  However, as I suggested above, I am starting to think that I might like to continue owning it to sell the Covered Calls and, in effect, create my own dividend while at the same time decreasing my basis.  As an FYI, I have received a net total of $7,878.46 in option premiums on YHOO going back to 2006.

The 22 YHOO analysts currently have a 12-month price target of $18.16 with a recommendation of 2.5 where 1.0 is a Strong Buy and 5.0 is a Strong Sell.  S&P has a 12-month price target of $20.00 and a Strong Buy recommendation.  MarketEdge has a price opinion of $14.71 and a Long recommendation but their opinion is a little old, dating from 9/26/11.

There are a number of comments about YHOO being a takeover target with MSFT and GOOG being included in the potential suitors.  I am also hearing comments that YHOO does not necessarily consider itself on the market.  I don’t know what to believe except that I was able to sell the front month option at a strike price $2 higher than the ones that just expired at a reasonable price.  Even if I am called away prior to November expiration I will be happy with the profit I will have realized. 

I considered selling the Jan12 17.50 or 19 strikes.  The 17.50 strike would have generated the greatest current cash flow but the October 17 strike produced the greater annualized return.  The greater cash flow was tempting but the greater annualized return was more compelling.  The return on investment is almost always better than the simple cash flow which can be deceiving.  I am pretty sure that if YHOO appears to be above my strike price in October that I will be able to roll my Calls out and quite possibly up.

YHOO does not pay a dividend so it does not meet my general investment goals.  However, as I suggested above, I am starting to think that I might like to continue owning it to sell the Covered Calls and, in effect, create my own dividend while at the same time decreasing my basis.  As an FYI, I have received a net total of $7,420.61 in option premiums on YHOO going back to 2006.

I considered selling the Jan12 17.50 or 19 strikes.  The 17.50 strike would have generated the greatest current cash flow but the October 17 strike produced the greater annualized return.  The greater cash flow was tempting but the greater annualized return was more compelling.  The return on investment is almost always better than the simple cash flow which can be deceiving.  I am pretty sure that if YHOO appears to be above my strike price in October that I will be able to roll my Calls out and quite possibly up.

I was assigned 2 YHOO Put contracts in July which increased my YHOO holdings to 800 shares and reduced my basis even further.  I might have rolled out the July Puts but being on vacation and not being able to stay right on top of them I decided earlier that I would just let them be assigned and not worry about it.

I continue to be short 2 Oct11 15 Puts on YAHOO in this same account.  At the moment, with YHOO trading at $13.61, I may end up with another 200 shares in a few months.  I will keep an eye on the October Puts and decide as October get closer if I should roll them out, if they might expire worthless or perhaps look forward to the assignment as it will further reduce my basis.  If this keeps up my return on YHOO option premiums will be large enough that I will want to continue to hold them for the premium income. 

YHOO does not pay a dividend so it does not meet my general investment goals.  However, as I suggested above, I am starting to think that I might like to continue owning it to sell the Covered Calls and, in effect, create my own dividend while at the same time decreasing my basis.  As an FYI, I have received a net total of $7,420.61 in option premiums on YHOO going back to 2006.