Options Expiration Day - June 2009

The Covered Calls Investor Portfolio contained a total of 9 positions with June 2009 expirations, and 10 positions either with a Non-June expiration or no current covered call. The 9 positions with June expirations had the following results:

- 2 positions (FAS, UNG) closed in-the-money. The calls were exercised and the stock was sold. Slightly dissapointing only two positions ended in-the-money, I was hoping for a large cash position to start out new covered call positions. The annualized gain/loss results (after commissions) were:

Direxion 3x Financial Bull (FAS) => +315.21%
United States Natural Gas => +113.57%


- 7 positions in the portfolio (T, CLI(4), FAS(2)) ended out-of-the-money. Similar to last month, CLI and FAS were in-the-money in the days preceding expiration and fell perilously a few days before lea.


AT&T (T) - $24.04
100 Shares with Current Cost Basis of $21.92

This position will be kept, due to the 7.5% dividend yield (based on current cost basis). This stock has not really moved since falling under $25 in the middle of May, it has held up above support at $24 however. Due to the current uncertainty surrounding the market's rally, I will continue to hold AT&T as a defensive play. If the $26 call can make its way up to about $.40 for July I will sell it, otherwise I will remain uncovered.

Mack-Cali Realty (CLI) - $22.34
100 Shares with Current Cost Basis of $17.01
100 Shares with Current Cost Basis of $17.1275
100 Shares with Current Cost Basis of $22.7113
100 Shares with Current Cost Basis of $17.7966


This position currently yields 9.6% (based on current cost basis). As I mentioned in the May expiration post, I am attempting to reduce the size of my position in this stock. Unfortunately, it seems to want to continue ending slightly out of the money on expiration day. In order to increase the likelihood of some of these shares being called away, I will sell at least 1 $20 call. If this position is called, then I accomplish my goal, and if not the cost basis will be reduced another 10%. The other three positions will remain uncovered in order to wait for an increase in the share price to sell additional calls.

Direxion 3x Financial (FAS) - $9.53
100 Shares with Current Cost Basis of $6.60
100 Shares with Current Cost Basis of $9.185

The positions in this ETF continue to yield great returns regardless of the closing price of the stock on expiration. It is my current plan to sell a $9, and 2 $10 July calls.


The positions in the portfolio which did not have June expirations include:

AT&T (T) - No Current Coverage

Bristol-Myers Squibb (BMY) - No Current Coverage

Best Buy (BBY) - No Current Coverage

Continental Airlines (CAL) - No Current Coverage

Alpha Natural Resources (ANR) - July $20 Put

General Electric (GE) - Cash-Secured Puts

Intel (INTC) - July $17 Call

United States Natural Gas (UNG) - July $15 Call.