Shares of KORS were assigned over the weekend at 62.00.
music selection: “Making Love Out Of Nothing At All” — Air Supply
weigh-in: 201.4 +1.0
KORS looked like it was going to expire out of the money and then fell unexpectedly on the last day of the contract, resulting in assignment. I am writing covered calls against the position for income. Today, I sold KORS180615C00062500 for 2.70 a share. The trade will be in force for 40 days and yields an expected 39.74% annualized against my cost basis of 62. If the shares are called away, I will earn an additional 50 cents a share in capital gains, resulting in an annualized return of 47.10%.
I am not making any other trades this week. I hope to prune my exposure over the coming months now that the benchmark 10-year Treasury has passed 3%.
Devour your prey raptors!
Found this re: yield curve inversion and thought you might find it interesting.
https://www.marketwatch.com/story/an-inverted-yield-curve-is-a-recession-indicator-but-only-in-the-us-2018-05-07
Very surprising. Thanks for sharing!
Velociraptor,
You might find this article I read today interesting. It brings up a few points which I don’t think many people are looking at.
https://seekingalpha.com/article/4171081-earnings-revenue-income-add-tax-exemption-fed-rate-hike-recessionary-perfect-storm
In particular it references this previous article which points out how the tax cuts are actually setting us up for a recession in 2019 and 2025 when many of the tax cuts expire. Given the deficits is unlikely these will be made permanent. So when they expire it will be a big shock to the consumer.
https://seekingalpha.com/article/4164507-cbo-shown-next-2-recessions-will-occur
The first article also points out how S&P 500 earnings are setup to have a big crash in Q1 2019.
Thanks for sharing!
I would classify these as entertainment. Underlying assumption #1 is that tax cuts = growth and tax increases = recession. I remember the opposite occurring in the summer of 2008 when I received my $300 retroactive tax cut check courtesy of G.W. Bush. Underlying assumption #2 is that tax law will not change for seven years, even though politicians routinely limit the duration of their tax cut bills just so they can have something to campaign on in the next election. “Elect me or my opponent might raise your taxes!”