3 Covered Calls for a Cool $1,000 in Income

This week's options play with coffee, credit cards and online dating

      View All  
3 Covered Calls for a Cool $1,000 in Income

Covered Calls on IAC/InterActiveCorp (IACI)

InterActiveCorp IAC 185 3 Covered Calls for a Cool $1,000 in IncomeIAC/InterActiveCorp (IACI) is Barry Diller’s conglomerate of online businesses — everything from lending to dating sites, including well-known names such as Match and Ask.com. Diller loves to buy businesses that generate huge cash flow, and that’s why I like IACI stock in general.

It’s also a premium choice for covered calls.

IACI stock is at $65, so have a look at the June $65 call, which is selling at $2.47. The 3.8% premium for a five-week-plus holding period is generous when it comes to calls. I’m usually happy if I can get 2.5%. So this covered call returns 36% annualized.

Selling two of them nets another $494. So we’ve collected $879 so far.

Next Page


Article printed from InvestorPlace Media, http://investorplace.com/2014/05/covered-calls-v-sbux-iaci/.

©2014 InvestorPlace Media, LLC

Comments are currently unavailable. Please check back soon.