TICN In The Press: February 24th, 2002

"INVESTMENT CLUB TRADING DIARY" by Aileen Power
Dublin, Ireland, 24 February, 2002 How did Patrick Murray's investment club make its profit? Patrick Murray's investment club drip fed about $ 1,150 per month into their trading account, depending on the Irish pound/dollar and euro/dollar exchange rate. The total investment for period Aug 01 to February 02 inclusive equals $ 9,000. The following is a chronology of shares which were bought and sold, and how they fared.

Aug 01: Two hundred shares in Symbol Technologies (SBL) were purchased at $ 11.95. A one-month out-of-the-money covered call' was sold generating $ 180 of income on the shares. The exercise price was $ 12.50. The option was exercised, and generated an additional $ 110 profit on the original purchase price. The total gain in one month was $ 290 on a $ 2,398 investment, or a 12 per cent profit.

Sept 01: 300 Oracle (ORCL) shares were bought at $ 14.15 each: total cost $ 4,256. A covered call was sold with an exercise price of $ 15. The option was not exercised, so the shares were retained. The profit was $ 345 or 8 per cent on the investment amount. In the wake of Sept 11, the share price fell to around $ 12.

Oct 01: A further 100 Oracle shares at $ 13.15 were purchased. A call option was sold which generated $ 115 of income. The option was not exercised so the shares were retained.

Nov 01: The club still owns 400 Oracle shares and sold a one-month call option, again at an exercise price of $ 15, which generated a further $ 235 income or a 4.25 per cent return on investment. The call was not exercised as the shares remained below $ 15. One hundred shares were purchased in Parexel, a clinical research company, at $ 11.90. A one-month call option was sold generating $ 59 of income or a 5 per cent return on investment.

Dec 01: Covered calls were again sold at an exercise price of $ 15 on the 400 Oracle shares, generating a further $ 415 of income. The total income generated to date on Oracle was $ 1,100 on a $ 5,527 investment, equivalent to a return of about 20 per cent, and the club still owns 400 shares.

Two hundred shares were purchased in Pacificare (PHSY), a healthcare insurance company, at $ 17.65. The price fell 13 per cent due to unexpected refinancing. However, call options were sold at an exercise price of $ 17.50, the price rallied and the option was exercised. The shares were sold which generated $ 275 and covered a major part of the share price depreciation.

Jan 02: The 400 Oracle shares were finally sold at $ 15, generating a cash sum of $ 6,000. The Pacificare shares were sold at $ 17.50, which showed a loss of 15 cents per share or a $ 30 loss in total. However, this loss was more than covered by option income of $ 275, therefore the net gain was $ 245.

The group purchased 300 shares in Jabil Circuits at $ 21.57 for a total cost of $ 6,472. A covered call option was sold at $ 22.50, generating an income of $ 470. The option was not exercised, so the club continued to own the shares.

The group also purchased 400 shares at $ 12.58 in a healthcare company called Humana at a total cost of $ 4,995. A call option was sold at a strike price of $ 15, generating $ 135.

The share price exceeded $ 15 on the day of execution and the share option was exercised, generating a further profit of almost $ 1,000.

February 20 2002 The value of the investment account stands at $ 12,000 at current valuations from an original investment of $ 9,000, producing a profit of 33 per cent to date.