BAC - Open Position

Written on December 2, 2008 – 12:13 pm | by admin

Today I opened another position in BAC (Bank of America).

Buy: 200 @ $13.55 ($7.00 commission)
Initial Investment: $2717
Sold: $2.50 strike @ $11.00 ( $9.50 commission)
Net Investment: $526.50
Expected Dividend: $64.00
Expected Return: 3.87% (-7.92% if called before 12/3)

I see this as almost no risk money. No person buys an option and exercises it on the same day. Also, I don’t see the Fed/Treasury letting BAC go bankrupt anytime soon. I believe they will do something similar to what they did for Citi if it comes down to it.

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