Safeway had a special last week and my wife can't say no to a deal. I'm having my first cup today and it's ok for the $.40 per cup she paid for them. On a scale of 1-10 I'd give their brand a 7.
Currently long GMCR and short Dec 75 and Jan 85 call options and when they expire I'll continue to sell more options.
In my farm account I increased my PM stake by 20% today to 5.5% of the account assets making PM the 5th largest holding in this account.
Sold the balance of my SYA shares to fund the purchase and also increased the cash in this account by about 10% to 5.7% of its assets.
This was in Roth IRA #2. The purchase increased my holdings by 40% to 15.2% of this account's assets making IBM the 3rd largest holding in this account.
Top 10 holdings in this IRA: 1-LO-23.2%, 2-STX-15.4%, 3-IBM above, 4-PM-14.8%, 5-BRKb-11%, 6-COP-4.6%, 7-AIG-2.9%, 8-JPM-1.8%, 9-MRH-1.7%, 10-MO-1.4% with the balance in cash and AAPL.
At lease on one side of the family. How long before the other side catches on?
LO is up over 36% this year with dividends included which means in dollar terms even after selling 28% of my shares I still have more cash invested in LO now than I did in January of this year.
Note-the S&P 500 is up about 29% this year with dividends included. This IRA is only up 17% year to date because it's still 45% cash which is used to write put options. You're lucky if you can earn 1% per month selling puts which is half that of the overall market this year.
I'll continue to buy high yielding stocks as cash becomes available and just live off the dividends over the coming months.
I also bought more AIG today at 49.4 per share and sold call options against it for added income. AIG currently trades at a deep discount to its book value and they're buying back their own shares-14% last year. If it's not trading above 60 next year I'll quit posting here for a year.
This was done in IRA #1 which is my largest IRA- Sold 28% of my LO and increased PM by 19% and AIG by 140%.
LO was called away at 50 for its dividend, I paid 85.13 for PM and 49.40 for AIG. Note-also sold out of the $$$ call options against AIG.
This account is currently 45% cash which is used for selling put options.
I too am a first time buyer-13.5 via puts I was already short-[that assumes the stock is put to meat 15] and I sold more put options today-April- 12s which paid me 70cents per share.
In IRA #1, sold 28% of my LO shares and invested 45% of the cash in PM increasing my stake by 19%. LO was called away early at 50 for the dividend.
This account is 47% cash which is used for selling put options, PM and LO are both about 8% followed by BRK and IBM both at about 6.5% of net assets..
What to buy next?
AIG sells at 65% of book value and they're buying back their own shares. I both own it and sell puts against it and I'm also selling puts against a handful of more speculative issues that I'd rather not recommend due to higher risk factors.
And now reverse the process-what happens when AIG buys back stock at a 35% discount to book?
By the way-the book value of our farm land is $800./acre but the market value is $10,000 to $15,000. Our hop picker may only have a book value of $500,000 but to build a new one today it would cost over $2 million and the old picker does the same job just as well.
"I sell naked OTM puts month in, month out for the premium and have made a tidy sum".
I was selling puts monthly but recently the premiums have dropped so I'm only short some leaps. I also own a small position in one of my IRAs. There's a very good chance that Berkshire takes this company over in the next few years or they let them buy back their own shares until BRK effectively owns the company as they did with Geico.
"DaVita HealthCare Partners Inc. (DVA), Fresenius Medical Care AG (FME) and other dialysis companies received a break from U.S. regulators, who are scrapping a proposed 9.4 percent cut in Medicare payments to the companies next year.
DaVita, the second-largest dialysis provider in the U.S., rose 13 percent in late trading after the Centers for Medicare and Medicaid Services finalized a rule today that keeps payments flat for 2014. Medicare proposed in July the 9.4 percent cut in pay for treating patients with end-stage renal disease" Bloomberg
Tell the kid he's outperforming my IRAs by a wide margin. I have 5 IRAs but only two of them are actually mine. They're all up 17-30 percent but the average is about 21%.
Note: Per Charles Schwab- the S&P 500 is up about 29% this year-note- this figure includes dividends.
Monday I'll sell more call options which should bring my option adjusted cost in the stock to under 60/share.
Christmas is coming-wouldn't GMCR coffee make an excellent xmas gift?
And BRK is up about 31%.
Where will people invest their retirement money next year after they see what their bond portfolios have done relative to their equity holdings?