Rolling BX cc up and out.

music selection:  “She Works Hard For The Money” — Donna Summer

weigh-in:  200.0 +1.6 – Stuffed my face at George P. McGovern awards banquet.

On 28JAN2019, I bought into Blackstone (BX) for 33.07 a share.  I immediately wrote a covered call.  That call expired out of the money over the weekend.  I am writing a new call but moving up from the 34 strike to the 35 strike.  This lets me earn reasonable income, increase the odds of collecting the 7.60% underlying distribution, and earn some short term capital gains on a stock in a steady uptrend.

This morning, I sold BX190418C00035000 for 39 cents a share.  The trade will be in force for 39 days and yields an expected 11.04% against my 33.07 cost on an annualized basis.  If shares are called away a price above 35, the yield will be 65.66%.  Else, I remain eligible for the underlying distribution of 64 cents a quarter (an additional 18.11% bonus over the 39 days of time in force.)

Blackstone is best in class at the many things it does in the finance space.  I have traded it many times in the past and have usually done well.  I’m about as extended as I’d like to be right now.  BONUS IDEA: If was looking to add more covered call exposure, I would look strongly at Southwest Airlines (LUV) right now.  The near the money covered call on 39 days time in force is currently paying around 24%.  With capital gains after having shares called at 52.50 the annualized yield would jump to 48.87%.  The company is well run and does a fantastic job of hedging its jet fuel commodity exposure.  It may be a buyout target by BRK-B as well.

Devour your prey raptors!

Covered Call Blackstone (BX) with yield up to 65.66%

Never miss another opportunity to devour prey!

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