Bio-Tech Covered Calls (CLSN,PPHM,KERX,ISIS,SRPT)
What's a Covered Call?
The covered call is a strategy where an investor writes a call option contract (sells an option) while at the same time owning an equivalent number of shares of the underlying stock.If this stock is purchased simultaneously with writing the call contract, the strategy is commonly referred to as a buy-write.
While you may have heard that trading options is risky business, covered calls are actually a very conservative strategy, and most brokerages even allow retirement IRA accounts to write covered calls.
|PPHM||Peregrine Pharmaceuticals Inc||2.33||2.5||0.4||17.20%||February 2013|
|KERX||Keryx Biopharmaceuticals Inc||2.97||3||0.5||15.20%||February 2013|
|ISIS||Isis Pharmaceuticals Inc||11.9||12||1.1||9.20%||February 2013|
|SRPT||Sarepta Therapeutics Inc||28.3||29||2.6||9.00%||February 2013|
|AMRN||Amarin Corporation PLC||8.38||9||0.5||6.30%||February 2013|
Peregrine Pharmaceuticals Inc (PPHM) is currently trading at $2.33. Its 52 week range is between $0.39 and $5.5.
Keryx Biopharmaceuticals Inc (KERX) is currently trading at $2.97. Its 52 week range is between $1.28 and $5.19.
Isis Pharmaceuticals Inc (ISIS) is currently trading at $11.92. Its 52 week range is between $7.02 and $15.61.
Sarepta Therapeutics Inc (SRPT) is currently trading at $28.28. Its 52 week range is between $2.6 and $45.
Amarin Corporation PLC (AMRN) is currently trading at $8.38. Its 52 week range is between $6.52 and $15.96.
MASTERY Bottom line:
There are pros and cons to writing covered calls. In theory, this strategy will out perform outright stock ownership if the stock price declines, remains the same, or slightly increases in price. The principal disadvantage of this strategy, on the other hand, is that profit potential can be limited if the underlying stock price advances sharply.
Best of the Blogs
Scanning and identifying the best blog entries every hour
- Dan Loeb Takes On Santa Claus | ZeroHedge
- The Stuka | Financial Sense
- Gold Drops $20, “I'd Rather Buy Silver,” Says Jim Rogers | Financial Sense
- Guest Post: Ukraine’s Two New Energy Deals | ZeroHedge
- Potential Danger Signal | Financial Sense
- What’s the Deal With That? | Financial Sense
- The Next Bull Market is in This Box | iBankCoin.com
The most relevant financial news and articles from the Internets
- In 2 Charts, Here's Why Lululemon Shares Are Getting Destroyed (LULU) | Business Insider
- Wall Street's 'Masters Of The Universe' Have Had It With Everyone In... | Business Insider
- How Fox News Reporter Jana Winter's Life Was Turned Upside Down —... | Business Insider
- Ocean City, Md.: America's Most Affordable Fun City | BusinessWeek
- Notable 52-Week... | StreetInsider.com
- INITIAL JOBLESS CLAIMS UNEXPECTEDLY SPIKE | Business Insider
- Here Are 10 Things We Learned About The Economy And Markets In 2013 | Business Insider