Wrote Feb 15 Covered Calls on DrysShips (DRYS)

We wrote Feb 15 covered calls against half our DryShips shares at 2.5. The calls were slightly in the money when we wrote the calls early in the day. Dryships (DRYS) stock is very volatile and so the premium on the calls is relatively high. Here are the possible outcomes and our strategy with this trade:

1. The stock continues to go down: We rollover and continue to collect premiums on the way down. This would help reduce our real cost basis.
2. The stock trades near where it is: We let it expire if they are out-of-money or close it for a small outlay if they are just barely in the money right before options expiry.
3. The stock spikes up: We allow the shares to be called away at options expiry. That will result in a roughly 10% overall loss, given our first purchase of these shares were at $19.25 on 10/9/2008. The net result will then be that we will continue to hold the shares we purchased on 11/20/2008 at $4.08, a much lower cost basis.

And, below is our updated portfolio:

Stock	Buy Date	Buy Price	Current Price	Current % Of Portfolio	Unrealized % Return	Yield as % of BOY Portfolio Value Plus Deposits
Altria (MO)	Various	16.69	16.84	4.35	0.93	0.16
Philip Morris International (PM)	1/4/2005	32.19	42.12	7.45	30.84	0.23
Kraft Foods (KFT)	Various	24.03	28.64	4.93	19.16	0.11
Pfizer (PFE)	Various	24.37	17.50	7.53	(28.18)	0.33
ICICI Bank (IBN)	5/18/2006 and 08/01/2008	25.28	16.86	7.25	(33.30)	0.17
Taiwan Semi (TSM) – Call Value	7/27/2006	8.71	7.50	6.47	(13.58)	0.24
Advantage Energy Fund (AAV)	11/2/2006	11.22	4.53	1.95	(59.64)	0.22
Central Europe & Russia Fund (CEE)	Various	39.23	15.66	4.72	(60.08)	1.85
Patni Computers (PTI)	8/10/2007	20.85	4.80	2.07	(77)	0.03
Itron Inc. (ITRI)	11/07/2007	85.01	62.64	5.39	(26.40)	None
Anthracite (AHR)	11/09/2007	7.97	2.05	0.88	(74.28)	0.35
ClickSoftware (CKSW)	11/09/2007	4.61	1.92	1.65	(58.35)	None
Harvest Energy (HTE)	11/28/2007	21.01	8.98	3.09	(57.27)	0.45
iRobot (IRBT)	12/18/2007	18.65	8.39	2.89	(54.63)	None
LDK Solar (LDK)	01/22/2008	30.49	13.93	3.60	(54.32)	None
Aegon N.V. (AEG)	04/28/2008	15.99	5.53	1.43	(65.41)	0.24
LM Ericsson (ERIC) (AEG)	05/05/2008	11.83	7.23	4.98	(38.87)	0.20
TD Ameritrade (AMTD)	05/21/2008	17.68	12.65	4.35	(28.47)	None
Trina Solar (TSL)	06/06/2008 and 07/31/2008	45.61	8.55	1.84	(79.70)	None
Costco (COST)	08/01/2008	62.28	48.80	4.20	(21.64)	0.03
Frontline Limited (FRO)	10/06/2008	36.95	31.48	4.06	(14.77)	0.41
DryShips Incorporated (DRYS)	10/09/2008	11.66	14	7.23	20.08	0.41
Companhia Siderurgica Nacional (SID)	10/10/2008	11.47	15.19	5.23	37.73	0.02
Cash				2.68
Total Portfolio					(35.35)	5.46

• For Altria and Philip Morris International, assumed spin-off ratio of 30.83:69.17. Altria is yet to supply the cost-basis info
• The yield column is current as of 11/21/2008.
• For Taiwan Semi (TSM), we wrote Feb 7.5 covered calls on them on 01/05/2009.
• For DryShips (DRYS), we wrote Feb 15 covered calls on them on 01/16/2009.