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
- Why Stock Investors Should Care What Happens in the Junk Bond Market | Financial Sense
- Stocks & Treasury Yields Are Collapsing | ZeroHedge
- The Difference Between Nominal And Real, In One Chart Courtesy Of Japan | ZeroHedge
- Does Surging Demand For Gold & Silver Coins Signal A Bottom? | ZeroHedge
- Why Oil Prices Are Dropping Despite Mideast Unrest | Financial Sense
- Contained? Dallas Hospital Discharged Sick Ebola Patient 2 Days Before Isolation | ZeroHedge
- Investors Are Too Comfortable In The Fed's Win-Win Conditions For Taking Risk | ZeroHedge
The most relevant financial news and articles from the Internets
- ... | StreetInsider.com
- ... | StreetInsider.com
- There's One Major Problem With Pepsi's New Stevia-Sweetened Drink | Business Insider
- Hallucinogens Legally Sold as 'Bath Salts' a New Threat | BusinessWeek
- Another Federal Judge Rules Against Obamacare, And It Could Set Up... | Business Insider
- Britain Is Not At All Sure It Likes The New 'Green' Coke Flavor (KO) | Business Insider
- North Korea Claims It's Making Alarming Progress Towards Building A... | Business Insider