I am adding 5,000 shares of MSFT at $26/share
Immediately, i sold March $26 call and pocketed $1.03 premium. I will also receive $0.2 dividend by 2/14/12.
This is how this investment look:
12/29/2011 MSFT 26 3/17/2012 1.23 53.4 26 50 4.73% $6,096.60 79 21% $130,000.00
If it got called away by 3/17/2012, my annualized return will be 21%. If it fail to get called away, then, my cost for that 5000 shares will be $24.77
Upside: I am very happy with 21% annualized return
Downside: I feel safe to hold MSFT at $24.77 cost.
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