BHP Billiton, symbol BHP, is an often unloved
stocks. It is a limited partnership that
has to pay our all its earnings. This
makes evaluating BHP’s fundamentals a little more difficult than your basic
corporation. Using MSN’s investing
information site, you can dig into the financials to learn that BHP makes a
nice amount of money to fund their dividend payout.
BHP is a resources company and demand and
utilization of resources varies substantially which is why earnings and stock
price can vary all over the place.
BHP Billiton pays dividends twice a year. This year their yield is over 4%. I am long BHP and underwater. I will add to my position today at about $57.75
and will sell January $62.50 call for a $1.10 per contract. A contract is equal to 100 shares.
Take a look at the covered call table below for an
analysis of this trade.
TheMoneyMadam
