Today I decided to close out my call position in ANR a few days before expiration. I am doing this to capitalize on a possible short term jump in the share price in order to resell my call at a higher price and further lower my cost basis. I also bought a July put to hedge my bets just in case the stock does not get called away, and continues to fall. I still believe in the underlying fundamentals of the position, and will sell a new call at $30 in July once the price gets to about $1.50. The new purchase metrics are below:
5/20/2009 -- Bought 100 ANR @ 29.26
5/20/2009 -- Sold To Open 1 ANR June $32.50 Call @ 1.24
5/20/2009 -- Bought To Open 1 ANR June $20 Put @ .3
5/21/2009 -- Bought To Close 1 ANR June $32.50 Call @ .55
5/22/2009 -- Sold To Open 1 ANR June $27.50 Call @ 1.45
5/27/2009 -- Bought To Close 1 ANR $27.50 Call @ 2.18
5/27/2009 -- Sold To Open 1 ANR $30 June Call @ 1.09
6/16/2009 -- Bought To Close 1 ANR $30 June Call @ 0.15
6/16/2009 -- Bought To Open 1 ANR $20 June Put @ 0.5
The important purchase metrics are below for insight into possible profit and loss (these all include commissions):
Stock Purchase Cost: $2926.00
Current Cost Basis: $29.16
Maximum Downside Risk (due to Put): 23%
Downside Coverage: None
Possible Max Upside: Unlimited
Annualized Max Upside: Unlimited
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