Whether today is a brief “short-covering” rally or a true “bear market” rally, we don’t care. The market is up and our 3 healthcare stocks are trading higher. Let’s manage two of those positions.
Cardinal Health (CAH): 66.61
We were assigned Cardinal Health shares over the weekend at 69.00 as we wanted since the stock goes ex-dividend on Friday (9/30) paying around 0.50 per share. We can sell a covered call out two weeks at a high enough price we should not get called out. If we, do we collect a reasonable premium and at least 1.00 of capital gains on our stock purchase.
ACTION: Sell to open CAH 14 Oct 70 call for a net credit of around 0.35 to 0.40.
Gilead Sciences (GILD): 63.36
Gilead never sold off as hard as some of our positions last week and the stock price is up 1% today. We can sell a covered call well about our break-even price.
ACTION: Sell to open GILD 14 Oct 65 call for a net credit of around 0.75 to 0.79 and a 1.1% return
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