Based on a reader comment from Alex, I decided to update my Intel cocktail from March.
"Question: INTC stands today at 24.68. Are you still in these positions, as declared on 3/21/07? The stock is up 30% from your 17.41 "cocktail cost"…what're the results of your investment, now that the underlying security has surpassed the 22.50 calls? "
Here's the mark to market:
Stock: $24.93 – $18.99 = $5.94 profit
$12.50 puts: $0.02 – $0.13 = $0.11 loss ($0.22 for 2x)
$17.50 puts: $0.14 – $0.95 = $0.81 profit
$22.50 calls:$3.65 – $0.80 = $2.85 loss
Dividends collected $0.1125
$5.94 – 0.22 + 0.81 – 2.85 + 0.1125 = $3.79
Had I just bought the stock, I'd have a higher profit ($5.94) but a bigger downside. I'm sticking with this position for now. I'll stick with it to get to my max profit profile. Though I never see anything wrong with exiting a position early, as the downside becomes much larger than the upside (this is often the case with deep in the money options positions).
Disclosure: I am still in the options position described. I also have a little bit of an overage in terms of stock position on which I outright long. I recently sold a small about of INTC (not part of this position).