In my previous update, I shared that on 4/17 I sold to open 4 contracts for 5/16, 115 SJM calls at 4.25 each. On 5/13, I bought to close those calls for .10. Why? The shares were going to trade ex-dividend on 5/16. That would mean if my shares got called away before 5/16, I’d lose out on the 1.08 dividend. With the shares trading as high as 112.78 on 5/13, I figured it was possible they could trade over 115 before 5/16, and my shares would be called away. So I bought to close my calls for .10 and thereby guaranteed that I’d pick up 1.08 on 5/16. No reason to risk not getting 1.08 in a couple days if it was only going to cost me .10 to guarantee it.
The shares did not trade over 115, so spending the .10 turned out not to be necessary. Nevertheless, I’m pleased with my decision as I do believe it was prudent at the time.
Moving on, after picking up rights to the 1.08 dividend, on 5/16, I sold 4, 6/20, 115 calls at 2.95 each. So that’s $1180 (400 x $2.95) in the coffers from the latest call sales and $432 from the dividends (payable 6/2).
Here’s the updated totals: $644 from 3/15 calls; $1,280 from 4/19 calls; $240 from 5/17 calls; $424 from 6/3 dividend; $560 from 8/16 calls; $432 from 9/3 dividend; $776 from 8/19 calls; $1,920 from 11.15 calls; $432 from dividend (ex-div 11.15; payable 12/2); $600 from 12/20 calls; $432 from dividend paid 3/3; $1,800 from 4/17 calls; -$44 from BTC 4/17 calls (on 4/16); and $1,700 from 5/16 calls; -$40 from BTC 5/16 calls (on 5/13); $1180 from 6/20 calls; and $432 from dividend (payable 6/2). That’s $12,124 total since the game began on 3/6/2024 for an average of $822 per month (through 6/2 dividend payment date).
Up next, Smucker reports earnings on 6/10. We’ll see how Smucker’s struggle with the Hostess acquisition is going and also hear about the high price of coffee and other exciting topics!
With Love ,
P. Gustav Mueller, author of The Present