tag:blogger.com,1999:blog-6097510160054715524.post6681977203911878728..comments2024-01-03T21:42:28.979-08:00Comments on DivGro: Two Recent Sells FerdiShttp://www.blogger.com/profile/05008021146951839361noreply@blogger.comBlogger10125tag:blogger.com,1999:blog-6097510160054715524.post-59488140732670777942017-04-26T09:23:32.278-07:002017-04-26T09:23:32.278-07:00Writing a naked call option would have unlimited d...Writing a naked call option would have unlimited down side, yes. Writing a naked put option does not. And you're right, I don't write naked calls, only covered calls.<br /><br />Do start your own blog! I've learned a lot even just researching what I want to write about, but also by reader's comments. It takes some discipline to keep at it, but it is well worth the effort!FerdiS, DivGrohttps://www.blogger.com/profile/07330193431527796718noreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-36819492662029763192017-04-26T09:19:52.697-07:002017-04-26T09:19:52.697-07:00Thanks for commenting, Passive IncomePursuit. Init...Thanks for commenting, Passive IncomePursuit. Initially I had the same issue (not owning 100 shares), so I closed some positions to make up the difference. <br /><br />Tax implications certainly is a consideration with covered call writing, and one should be careful when doing so. As for me, I have some losses from past years that I still need to make up for (as far as the IRS are concerned), so I'm OK with generating some capital gains.<br /><br />My hope is to eventually match dividend income with options income. I'm not there yet... for this year, my goals are $12,960 in dividend income and $8,400 in options income. If I can succeed, that's a significant boost to dividend income and, therefore, to compounding DivGro's income-generating capacity. FerdiS, DivGrohttps://www.blogger.com/profile/07330193431527796718noreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-55802759499258332262017-04-26T09:12:39.732-07:002017-04-26T09:12:39.732-07:00Agreed! RAI's performance is stellar. I'm ...Agreed! RAI's performance is stellar. I'm glad I have 100 more shares to ride along with. <br /><br />I'm not thrilled about the idea to own shares of BAT, so I'll eventually sell my RAI shares before the takeover finalizes. FerdiS, DivGrohttps://www.blogger.com/profile/07330193431527796718noreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-42048932086450189872017-04-26T09:10:29.872-07:002017-04-26T09:10:29.872-07:00Thanks, Dividend Family Guy -- KMB's return is...Thanks, Dividend Family Guy -- KMB's return is "bleh", but RAI certainly generated nice returns. FerdiS, DivGrohttps://www.blogger.com/profile/07330193431527796718noreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-57571255724512007662017-04-22T10:27:01.706-07:002017-04-22T10:27:01.706-07:00Awesome returns on RAI. We cannot win every option...Awesome returns on RAI. We cannot win every option contract, but to your point you could've rolled the option. I like the idea of assignment, especially considering you had already made a significant gain on the stock. Nice work.Anonymoushttps://www.blogger.com/profile/15330040244289368427noreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-89477478601877390682017-04-21T03:53:56.461-07:002017-04-21T03:53:56.461-07:00Not a bad return for the amount of work ;-)
Later,...Not a bad return for the amount of work ;-)<br />Later,<br />DFGDividend Family Guyhttps://www.blogger.com/profile/00692907194937963688noreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-74269286516692226062017-04-20T22:45:37.832-07:002017-04-20T22:45:37.832-07:00Those returns on RAI are stellar. I don't do ...Those returns on RAI are stellar. I don't do a lot of covered call writing although that's more of a function of not owning 100 share lots of most of the companies that I own. That's something that I really want to address although I'm a bit hesitant to do much covered call writing within my taxable account especially on positions where shares were purchased years ago. Yeah I can make a bit more via the option premium but I also don't want to create a taxable event just for the sake of doing that. It's funny because I know that's the right thing to do, but I just can't bring myself to do that. However, in my tax sheltered accounts it's all fair game.Passive Income Pursuithttps://www.blogger.com/profile/13947101854482544346noreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-17955551017627468312017-04-20T20:34:32.461-07:002017-04-20T20:34:32.461-07:00It is unlimited if you are writing naked options. ...It is unlimited if you are writing naked options. But Ferdi does not do that. I have to say I wait every week for some updates from you. You blog is fantastic and i am learning a lot. I will be staring my own blog shortly. My strategy is very similar to what you are doing although i have few speculative stocks there for the capital gain. Keep up the great work! :)<br /><br />I'm trying to think of a blog name (KISS (Keep It Short and Simple)) finance) Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-12061524080624603352017-04-20T08:43:22.954-07:002017-04-20T08:43:22.954-07:00Thanks for commenting, Troy -- but I have to ask: ...Thanks for commenting, Troy -- but I have to ask: how does selling options have unlimited downside, even theoretically? <br /><br />If I sell a covered call, I own the underlying stock and I decide what I'm willing to sell for, collecting the option premium to boot. I don't see any downside and certainly none that is unlimited.<br /><br />If I sell a put, I sign up for buying a stock at a certain price -- usually at a discount to the current price. Theoretically, the company could go bankrupt (unlikely) and I would have to buy shares at the strike price. My loss would be capped and, therefore, it is not unlimited.<br /><br /><br />FerdiS, DivGrohttps://www.blogger.com/profile/07330193431527796718noreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-51874789812390783282017-04-20T02:39:50.269-07:002017-04-20T02:39:50.269-07:00Nice returns on Reynolds. Personally I would never...Nice returns on Reynolds. Personally I would never be a seller of options. Limited upside, unlimited downside (theoretically). Sure the income looks nice, but all it takes is one big loss to wipe that out.Troy @ Market Historyhttp://markethistory.org/blog/noreply@blogger.com