Published Wed, 17 Apr 2019 09:57:36 -0400 on Seeking Alpha
In my previous article I outlined the beginning of my new fund focusing on undervalued volatile dividend stocks that have lucrative option premiums, which allows us to collect income while waiting out any short-term headwinds in strong companies. You can find a link to that article here.
One month ago, I had written an article outlining a new fund I created involving selling covered calls on volatile, undervalued dividend stocks. The main criteria for selecting stocks for the fund was the following:
1.) Positive Earnings and Revenue Growth.
2.) Never pay more than 15x Forward Earnings for a stock.
3.) Sustainable Payout Ratios
4.) 3.5% Portfolio Yield
5.) Buy in quantities of 100 and sell Jan 2020 calls at strike approximately 20% above where the stock currently trades
Currently, the fund has 17 total positions, shown below.
Source: Alex Pickrell
Only two of the positions were added in the last month, Triton (TRTN) and ADT Inc (ADT). You can find the case I made for Triton here.
As you can see, as of the closing bell Friday, the one month return without including options premiums or dividends has been 4.27%.
Source: Alex Pickrell
This equates to slight under-performance of the S&P 500 for the month. However, when you factor in for the 5.82% option premiums received for the Jan 17th 2020 calls sold on the positions and dividends that are scheduled from the time of initiating the position to January 17th of 3.14%, the... Read more
|Stock name||Last trade||P/E||Earnings/Share||Dividend/Share||Dividend yield|
|TANGER FACTORY OUTLET CENTERS||16.39||19.1||0.86||1.42||8.61|
|AMERICAN EAGLE OUTFITTERS||18.10||12.2||1.48||0.55||3.16|
|CLIFFS NATURAL RESOURCES||10.99||2.8||3.86||0.24||2.25|
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