Long Call on Cummins, CMI

For my friends and readers who like to go out further than 90 days on their calls, consider this opportunity.

CMI, buy today mid $97.   Hold until June and receive the dividend of $.9750 in May.  Sell a June $110 call for $1.50 premium.   If your stock is called away your gain is north of 15%.  If you still hold it even at $97.50 your income from the call premium and dividend equals 2.5% in less than 120 days.  

See the table below.




Folks, this is good income investing.

M*TheMoneyMadam

Disclosure:  Long CMI with calls