ESV Covered Call

Today I sold an ESV covered call and collected a $112.30 premium for the right to sell 100 shares at $30 a share. This is below my basis, but I would not mind selling off part of my position and replacing it with a more stable company. If I lose the 100 shares I will still hold around 160 shares.


ESV Covered Call

Action: Sell to open
Description:  ESV JAN 15 2015 $30.00 CALL
Quantity: -1 contracts
Execution time: 06-08-2015 (today)
Price: $1.20
Total Proceeds $112.30 ($7.70 in commissions)


This increases my open premium total to around $415.00 plus I already closed a GE option trade that added an addional $181 dollars for a total of around $600.

Below are some other covered calls that are still open. I have actually earned quite a bit of the premiums as the strike price is quite a bit higher than the market prices right now. I may close out a couple or all of the positions soon. The reality is I don't want to sell any of the shares listed below. I guess I should have thought things through before selling the options to begin with. While I am earning premium money, which is cool, I don't like worrying about whether I am going to lose the shares. I keep bouncing back and forth with whether or not I want to continue doing these.

I guess I am greedy and want to collect the premiums and keep the shares. :-)



BBL Covered Call

Action: Sell to open
Description: BBL SEP 18 2015 55.00 CALL
Quantity*: -1 contracts
Execution time: 05-11-2015 10:19 ET
Price: $0.98
Total Commissions & Charges: $7.70
Total Transaction Amount: $90.30
Trade Settlement Date: 05-12-2015 

GM Covered Call

Action: Sell to open
Description: GM JAN 15 2016 40.00 CALL 
Quantity*: -1 contracts
Execution time: 04-27-2015 15:07 ET
Price: $0.98
Total Commissions & Charges: $7.70
Total Transaction Amount: $90.30
Trade Settlement Date: 04-28-2015


BP Covered Call

Action: Sell to open
Description: BP JAN 15 2016 47.00 CALL 
Quantity*: -1 contracts
Execution time: 04-09-2015 11:35 ET
Price: $0.76
Total Commissions & Charges: $7.70
Total Transaction Amount: $68.30
Trade Settlement Date: 04-10-2015


VZ Covered Call

Action: Sell to open
Description: VZ JAN 15 2016 50.00 CALL 
Quantity*: -1 contracts
Execution time: 04-09-2015 12:24 ET
Price: $1.75
Total Commissions & Charges: $7.70
Total Transaction Amount: $167.30
Trade Settlement Date: 04-10-2015

DEFY MEDIOCRITY

May 2015 Income and Expenses

The amounts below are cash amounts and are net of taxes, insurance, 401k contributions, HSA, etc. In other words, the amounts are what get deposited and withdrawn from my accounts.

Day job (take home pay) --- $12,889.45
Dividends/interest --- $1,110.96
AdSense (deposit) --- $114.25

Total net income --- $14,114.66

Expenses --- $3,991.24

Savings --- $10,123.42  Rate --- 71.72%


Sometimes you just have to expect the unexpected. As many know, Houston as well as much of Texas was inundated with rain last month. I can't honestly remember a month where I saw so much rain day after day. Here it is June 4th and I have yet to water my yard this year. For those who live in the south, you know that never happens. Usually the sprinklers fire up in late April and stay on through November.

In spite of the rain, I actually had my second best paycheck total this year and I only trailed March's total by around $20. I feel very fortunate to live in a state like Texas and more specifically a city like Houston. We may not have the great tourist attractions that many cities can boast about, but we are designed to do business and those who have dreams of making their fortunes and building empires should put Houston at the top of their list.

Anyway enough of the Houston Chamber of Commerce informercial. Despite spending a bit extra on a road trip/vacation, I am happy to report that I was able to keep the expense total under $4,000. The only real outlier expense was the $400 I spent on my tax preparation. Any of you accountants working for a large company, do yourself a favor and start your own practice ASAP!!!!  I can't believe what a gold mine tax preparation is.

I would like to keep my expenses a bit lower than they are so I can reach FI sooner, however how low can they reasonably go? Since I spent $4,000, if I had zero bills (impossible with taxes, utililites and food) the most I could drop is $4.000. On the other hand, income, in theory, has no upper limit. So between the two choices, I must focus on making more money right now. It's like a football team with an offense (income production) and a defense (expense reduction). It's nice to have a great defense and most likely the defense will keep you in the game, but ultimately it's the offense that determines the team's success. Trying to keep a team scoreless each time out is very difficult. I don't know where that analogy came from, however you get the point....hopefully.

So there you have it. A pretty solid month overall and with a few tweaks here and there, I think I can continue to improve my savings rate going forward.


Here are my savings rates for 2015.

January --- 46.72%
February --- 67.78%
March --- 80.00%
April --- 35.97%
May --- 71.72%

DEFY MEDIOCRITY

Here we go again....HCP Purchase

Today I added to my HCP and it is now my largest individual stock position.

• HCP:  100 shares @ 37.46 --- Yield  6.03%

Total capital invested is $3752.95 and my yearly dividends will increase by $226.00.

I'm now just under $1000 a year in forward HCP dividends.

Wow!!! Talk about falling knives all over the place. Holy shit between REITs and Oil I am going to have to keep a bottle of Crown here at the office. Well we (we meaning me) all wanted volatility, well here it is.

Oil, REITs, utilities, and tobacco are in my crosshairs....or maybe I'm in theirs???


DEFY MEDIOCRITY

Stock Purchase Take 2: VZ

After picking up shares of CVX earlier, I decided to add to my VZ position.

• VZ:  21 shares @ $48.10 --- Yield  4.57%

Total capital invested is $1017.05 and will add $46.20 to my yearly dividends.

For some reason T and VZ have decoupled recently so I went with VZ. Currently my T position is about 2 1/2 times my VZ position.

Adding heavy hitters like Shell, Chevron, and VZ this week should help me inch closer to $17,000 in forward dividends/interest.....or perhaps back to $15,000. :-)

No risk no reward and I hate fucking safety nets.

DEFY MEDIOCRITY

Stock Purchase: CVX

Today I added to my position in Chevron.

• CVX:  10 shares @ $101.66 --- Yield  4.21%

Total capital invested is $1023.55 and will add $42.88 to my yearly dividends.

It was difficult deciding between WPC and CVX this morning. In the end I went with the more powerful company and will continue to monitor WPC as well as HCP.

Weekly Sharebuilder Purchases

When it's time to draft players (stocks) for my team (portfolio) it never hurts to add these guys...

• XOM:  2.94 shares @ $85.04 --- Yield  3.43%
• JNJ:  2.51 shares @ $99.61 --- Yield  3.01%

Total capital added is $500 ($250 in each company). The combined yield of these purchases is 3.22% and will add $16.10 to my yearly dividends.

I decided to take it easy today as I made a larger investment in Shell yesterday, not to mention a Trans Am last week. It looks like energy companies are front and center again along with REITS and Canadian banks. The railroad companies are commanding some attention as well.

I looked over my portfolio and aside from the over-exposure in energy, I noticed that my company count is getting a little high for my liking. I am going to focus on the businesses I already own and either maintain or reduce the company count. If I see a new business I like, I will add it to the portfolio with the plan of reducing a position somewhere else. It's getting a bit cumbersome at these levels.

Not that it should matter too much, but I have companies like PM, BP, T, RDS-b, and HCP that pay $600-$850 a year in dividends and companies like NOV, WM, CAG, PEP, WMT, BAX, and AFL that each pay under $150 a year. I guess over time it equalize, but I don't like the balance right now.

Companies on my radar for next week include JNJ, PEP, XOM, NSC, KMI, WPC, and SO.

DEFY MEDIOCRITY

Stock Puchase: Shell

Today I added to my Shell position.

• RDS-b:  25 shares @ 59.53 --- Yield  6.32%

Total capital invested is $1495.20. This will increase my yearly dividends by $94.00.

Every time I think I am done with energy purchases, like a giant magnet the sector pulls me back. Maybe I should say like a giant whirlpool. Yikes!!!

Oh well...the music plays on so I will keep dancing!

DEFY MEDIOCRITY