Not too long ago one half of my position in Chevron was called away. Do I really want to lose all my CVX? It has been such a good income stock but the yield was below 3%. Then the price of oil crashed.
I am happy to have these shares of Chevron as they provide nice steady income. Recent increases have not been good but what has been good recently?
I just have to add to CVX again. Buy when there is blood in the streets and that would have been last week. You cannot pick the bottom. If you want safety, look at the long term dividend payout through thick and thin. Look at the D/E ratio. I have to add when no one else wants it. I can add even more income with fantastic covered calls. See below
THE CHEVRON TRADE
Buy 300 shares at $76.84 based on closing price 9/8/2015.
Sell an October 80 call for $1.68
Sell two November $85 calls for $1.05
Receive the November dividend of $1.07 on 300 shares or bank the capital gain.
Let's see what happens tomorrow.
Disclosure: Long CVX expecting to add with calls
9/9/2015 Update: Sticking with these calls. Putting in limit orders of $1.05 on the Nov. $85and $1.70 on the October $80. If you are really greedy you might consider a November $80 for a whopping $2.47. MM