Andy Sirski will speak about his covered call strategy in High River, Alta., on February 24. As a promo, he writes:
A lot of readers say they have no time to invest. But look at the money some readers made with one or two reversible transactions per year.
Potash Corp.: Sold one call in March ‘09 for October and collected $18 on $100 stock. Come November sell call for April and collect $12. Total for the year: $30 or 30 per cent on a $100 stock. On December 31, 2009 Potash Corp was trading for $117.
Coeur D’Alene: Sold one call in December ‘09 for January 2011 and collected $4.60 on a stock that cost $18.50, which is 24 per cent for 13 months.
Our trading account was up 120 per cent for the year. Another account was down one per cent in the bear market of 2008 and up 26 per cent in 2009. Many investors lost two years to break even.
We didn’t sell calls on Teck Resources (TCK. B). Instead we bought 1,000 shares at $9.50, 1,000 at $12.00 and 1,000 at $15. Year end price was $37 and change. I did sell puts on this stock from June 2009 on. Most people don’t know how to sell covered calls or sell puts so they think the strategy is dangerous. We do need to use our head.
At the end of December 2009, four stocks we own were considered to be a“buy” on Trendsetter on www.barcharts.com.