Petrobakken?? PBN-T

[grassfarmer]

Selling covered calls not worth it huh? from someone who doesn't know how to do it. I follow Mr Sirski's newsletters and find it fairly easy to make 20% a year using his methods. Easiest money I've ever made. What was your prediction on RIM a few months back when you were buying it Hopper?

[Hopperbin]

Obviously not good at the moment still hold it, down almost 50 percent

[Hopperbin]

Glad I still have my day job lol

[Hopperbin]

Anyways bash me on rim or sso what ever you like, how the hell do you make 20 percent on a covered call per year, your ****ed

[grassfarmer]

I'll give you one example of many Hopper.
Bought FR (First Majestic a developing silver company)in June for $16.04 and sold a covered call immediately for October $17 picking up a $1.69 premium. Fully expect to be excercised these shares next weekend for a total return of $18.69 ($17 $1.69)so a gain of 16.5% in 4 months. If I hadn't bothered with the covered call i'd only be up @6% on the stock.
Selling the call brings in additional income and also provides downside protection - as soon as I sold the call my book value went down to $14.35. If the stock had gone up to $21 I either lose out on that extra profit or I can buy back the call and sell another higher - or I could just settle for 16.5% in 4 months.

[crusher]

I've sold covered calls also and made great returns. Just takes some time which I don't have in the summer but do in the winter.

[hobbyfrmr]

So, I'm an amateur, but PBN-T looks appealing to me. 1. They pay a dividend, 2. They have upside potential. I think there are people out there who would buy (because I would own these shares) the call options I would make available for sale. Double dipping, collect covered call premiums, and also dividends.

[grassfarmer]

Charts don't look too exciting to me, on the upswing now but has been an under-performer for a while now.

http://stockcharts.com/h-sc/ui?s=pbn.to

Still you could buy at $8.47, sell a Jan. $9 call for $1.15 and if you get excercised at that you are 13.5% up in 3 months.