I am long KOG and I notice it has in a trading range of $8.50 to $9.50 for almost a year. So I am still playing it that way, selling Jan14 $10 covered calls on half my position. In my mind it is taking money from the shorts because the smarter ones buy calls to protect their positions. The ask is .75, but I will try for .85. I believe that within a few months, I will be able to buy them back for a quick profit and a reduction in my cost basis for a long term capital gain. Touche' short! Rinse and repeat.
Never nothing wrong with covered calls but I would actually make sure you have a core growth target, infact I was hoping to trade around a core but I need to KOG to get back above 10. Personally I would buyout some of the 2015 options for some of your holdings and then trade around a core for the other that away you do not have so much dead money tied up. The 2015 strikes at 5 and 7 are pretty reasonable for KOG. Short interest is up 3 million shares this month alone to over 30 million, personally I think KOG is going to have to get below 25 million or 22 million before you see price share appreciation. Nasdaq does a decent job of updating every two weeks. I would never make a decision based on getting even with shorts, its about making money for you and whether that is long or short but I love the idea of covered calls on KOG, I wish I would have done more of that last year.