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
- Turkey Arrests Generals Who Stopped Syria-Bound, Weapons-Laden, Spook Trucks | ZeroHedge
- Paul Craig Roberts Rages At The "Arrogance, Hubris, & Stupidity" Of The US Government | ZeroHedge
- "It Is All Rather Scary" - Chinese Debt Snowball Gaining Momentum | ZeroHedge
- To JPM, This Is The Alarming Chart Suggesting The Next Recession "Is Just Around The Corner" | ZeroHedge
- Which Stocks Are Cheap? | ZeroHedge
- Gold Demand in China Heading For Record and Reserves Increase 14 Tonnes In October | ZeroHedge
- Obama to Veto Bill Requiring Background Checks on Syrian Refugees | Financial Sense
The most relevant financial news and articles from the Internets
- Which Is America's Best City? | BusinessWeek
- When I was 6, my dad taught me a critical money lesson that forever changed the way I spend | Business Insider
- Ocean City, Md.: America's Most Affordable Fun City | BusinessWeek
- 3 tips to beating a Daily Fantasy Sports pro — even if you've never... | Business Insider
- Blank spaces replace NYT article on flagging Thai economy... | Business Insider
- 'Hunger Games' beats 'Good Dinosaur,'... | Business Insider
- The Best Business Schools of 2011 | BusinessWeek