Friday, January 13, 2012

Covered Call on FCX

          Yesterday and today I found my entry point for Freeport McMoran (FCX).  I posted last week that I would focus on FCX for income during this week. Earlier this week I could not find a call but yesterday and today with the perceived increased demand for copper from China, a call emerged.  Here is the math.

          Buy FCX                $41.90
          2/18/12 strike price $45.00
          Call income             $   .90

          Call income yield $.90/$41.90 = 2.149% yield
          Strike price yield if exercised (not including dividends) $4.00/$41.90 = 9.54% net gain

Have a great weekend.  Look for more income opportunities.  More ideas next week.

Very Truly Yours,