This was my first new position after returning from vacation. SIMS metal management is the world's largest metals recycling company and is based on Australia. I chose to open this position in order to further diversify my portfolio with a construction type play, as well as adding some more "international flavor." The options premiums are pretty high for this particular stock, but they are also not very liquid, so it is best to establish a cc by setting a net debit order instead of buying them separately. The profit/loss info is below:
9/28/2009 -- Bought 100 SMS @ 19.69
9/28/2009 -- Sold To Open 1 SMS October $20 Call @ 0.7
The important purchase metrics are below for insight into possible profit and loss (these all include commissions):
Cost Basis: $1899.00
Downside Protection: 3.5%
Potential Gain If Called At Expiration: 5.06%
Potential Annualized Gain If Called At Expiration: 97.11%
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