T Stock Trades For 2012

T Stock was added to my portfolio for the first time in 2011 and was a solid performer for the year. T Stock put trades added $3606.25 of income towards my total 2011 earnings of $163,456.00. If I deduct my SPY PUT hedge 2011 earnings, my total income from put trades in 2011 was $87,825.00. Therefore T Stock trades provided 4.1% of that entire total!

T Stock Plan For 2012

I believe that T Stock is undervalued and should be trading above $33.00. With this in mind my goal remains the same for T Stock. I will sell puts until I accept assignment of T Stock shares. I will then sell covered calls, but stretch them out so as to also try to pick up the quarterly dividend. Then once exercised out of my stock through covered calls, I will repeat the cycle. If or once T Stock moves into fair value I will be more careful to stay out of the money. If T Stock becomes over-valued, which I think may happen this year, I will sell further out of the money puts so as not to be assigned shares at over-valued prices. If the premiums do not warrant selling, should the stock move higher, I will end put selling in T Stock and move on to another stock while waiting for T Stock to fall in price. Select this T Stock link to review AT&T Investor Relations

T Stock Chart 2009 to 2011

The chart below shows the past 3 years in T Stock. You can see the gradual climb in T Stock valuation. In 2011 the Stock hit an intraday high of $31.94. The low for much of 2011 was in the $27.50 range. This made put selling straight forward in T Stock. During the period when the stock rose, I held off selling puts. You can review the 2011 T Stock trades through this link.

Unless this trend changes this year, which I believe it will by T Stock moving higher, the best premiums are going to be in the $29 and $28 put strikes. Based on the past performance both of those put strikes have a very good chance, if the stock falls and I get assigned shares, that I can sell covered calls and be exercised back out.

T Stock chart for 2009 to 2011

T Stock Chart For 2009 to 2011 Shows The Gradual Climb In Valuation

Review T Stock Trades For 2011
review USA Stock Portfolio for 2012

T Stock Trades For 2012

Current T Stock Status – Year 2

Capital Currently In Use: $32020.00
Income Earned in 2012: $14744.75
Total Income Earned Since Trade Started In 2010: $18351.00
Total Of My Own Capital Required If All Naked Puts Were Assigned: $13669.00
Number Of Shares If All Naked Puts Were Assigned: 1000
Share Price Valuation (Total Capital Required/Number of shares): $13.67


Date Stock At
Time Of
Trade
Action Taken (All Figures Are US Dollars)
ACTIVE TRADES ARE HIGHLIGHTED
Comm. Shares
Held
Capital
In Use
Gain/Loss Total
Income
Dec 16 2011 28.85 Final Trade for 2011 was: Sold 10 Naked Puts 21JAN12 $27 for .24 (status: expired) 19.50 24019.50 220.50 3606.25
END OF 2011 TRADES

Jan 6 2012 29.68 Sold 10 Naked Puts 18FEB12 $29 @ .44 (status: expired)
Comments: I am not concerned about being assigned shares in T Stock at these levels. I believe T Stock is undervalued and is stuck in a trading range that makes a compelling case for put selling. Read more about the Jan 6 2012  T Stock trade.
19.50 29013.25 420.50 4026.75
Jan 20 2012 30.51 Jan Options Expiry: 10 Naked Puts $27 expired
Jan 30 3012 29.20 Bought 1000 T Stock at $29.20 (status: sold $33) 7.00 1000 (29207.00)
Jan 30 2012 29.20 Sold 10 Naked Puts 18FEB12 $29 for .32 (status: expired) 19.50 29019.50 300.50 4327.25
Jan 30 2012 29.20 Sold 20 Naked Puts 17MAR12 $29 for .53 (status: expired) 32.00 58032.00 1028.00 5355.25
Jan 31 2012 29.42 Bought 1000 T Stock for $29.42 (status: Sold $33)
Comments: I plan to hold these shares for what I believe will be a run to at least $31.00. You can read my comments here.
7.00 2000 (29427.00)
Jan 31 2012 29.42 Sold 10 Naked Puts 17MAR12 $29.00 for .47 (status: expired) 19.50 29019.50 450.50 5805.75
Feb 10 2012 29.80 Sold 10 Naked Puts 20APR12 $29.00 for .41
Comments: I believe T Stock is going to push higher from here and this may be my last chance for a while to sell the $29 put strike. With my Feb 29 puts about to expire I have sold out to April since I am already holding March. April could mark the last month of rises in stocks for a while if the sell in May theory holds up again this year.
19.50 29019.50 390.50 6196.25
Feb 17 2012 30.01 Feb Options Expiry: 10 Naked Puts $29 expired
Mar 16 2012 31.59 March Options Expiry: 10 Naked Puts $29 expired
Apr 5 2012 30.94 Dividend 2000 T Stock shares X .44 880.00 7076.25
Apr 10 2012 30.00 Sold 10 Naked Puts 19MAY12 $29 for .28 (status: expired) 19.50 29019.50 260.50 7336.75
Apr 20 2012 30.86 Apr Options Expiry: 10 Naked Puts $29 expired
Apr 23 2012 30.70 Sold 10 Naked Puts 16JUN12 $29 for .28 cents (status: closed for .02 cents) 19.50 29019.50 260.50 7597.25
May 2 2012 33.00 Sold 2000 shares T Stock for $33 7.00 0 65993.00 7359.00 14956.25
May 18 2012 33.66 May Option Expiry: 10 Naked Puts $29 expired
May 22 2012 33.54 Bought To Close 10 Naked Puts 16JUN12 $29 for .02 cents 19.50 (39.50) 14916.75
No positions as I believe the stock is fully valued. Will wait for a pullback before doing any more put selling against T Stock
June 25 2012 34.88 Sold 10 Naked Puts T Stock 18AUG12 $34 for .68 (status expired) 19.50 34019.50 660.50 15577.25
July 24 2012 34.33 Sold 5 Naked Puts T Stock 22SEP12 $33 for .41 (status expired) 13.25 16513.25 191.75 15769.00
Aug 17 2012 37.17 August Options Expiry August $34 naked puts expired
Sep 21 2012 38.08 Sept Options Expiry Sep $33 naked puts expired
With T Stock over $38 it is very overvalued in my opinion and should pull back to the $35 level before I start more put selling
Oct 1 2012 37.75 Bought 5 Puts 22Dec12 $36 strike for .68 (status: sold for $1.54)
Comments: Bought these puts as I believe the stock is setting up for a decline but by buying December I have lots of time to have this trade work out, if I end up being wrong.
13.25 (353.25)
Oct 12 2012 35.55 Sold 5 Naked Puts T Stock 17NOV12 $34 for .34 (status: BTC Nov 13 for .16)
13.25 17013.25 156.75 15925.75
Oct 15 2012 34.90 Sold 5 Naked Puts T Stock 22DEC12 $32 for .36 (status: BTC Nov 23 for .09)
13.25 16013.25 166.75 16092.50
Oct 15 2012 34.90 Sold 5 Puts 22DEC12 $36 strike for $1.54 13.25 756.75 403.50 16496.00
Nov 9 2012 32.85 Sold 5 Naked Puts T Stock $32 for .74 (note change in Commission rate) 10.00 16010.00 360.00 16856.00
Nov 13 2012 34.37 Bought to close 5 Naked Puts 17NOV12 $34 for .16 10.00 (90.00) 16766.00
Nov 19 2012 32.90 Sold 10 Naked Puts T Stock 22DEC12 $33 for $.92 (status: expired)
15.00 33015.00 905.00 17671.00
Nov 19 2012 32.90 Sold 5 Naked Puts T Stock 19JAN13 $32 for $1.15 10.00 16010.00 565.00 18236.00
Nov 23 2012 34.36 Buy To Close (BTC) 5 Naked Puts T Stock 22DEC12 $32 for .09
Comments: Read this T Stock article to understand this trade.
10.00 (55.00) 18181.00
Dec 21 2012 33.67 Dec Options Expiry 10 naked Puts T Stock $33 expired
Dec 21 2012 33.67 Change In T Stock Put Selling Strategy – To understand the change please read this T Stock article.
Dec 31 2012 33.15 Sell 5 Naked Puts T Stock 19JAN13 $32 for .36
Comments: The pullback in T Stock means a return of 1% for 3 weeks as long as T Stock stays above $32
To understand this trade please read this article.
10.00 16010.00 170.00 18351.00