Stock Portfolio and Watch List Updates for August 2010

Following are the activity from the previous month:

1. The Covered Calls we wrote on Advantage Energy Fund (AAV Aug 2010 7.5) on 3/9/2010 expired worthless.
2. Wrote cash covered puts on Qaigen (QGEN Nov 2010 17.5) at $0.90 and Costco (COST Jan 2011 55) at $3.40. The cash coverage requirement for the combined position is about 4% of our total portfolio value.
3. Added about 1% of our total portfolio value in cash. As mentioned in the update last month, this is part of a nest egg that was built up in the last year, being put to work in an incremental fashion.

The cash coverage requirements on the puts account for about 39% of our cash position. The cash position in our portfolio is still pretty high at around 47%. We will continue to use cash-covered puts along with direct puchases spread-out over a period of time to build the portfolio.

Below is our updated portfolio – it is aound 2.5% in the red:

Stock	Buy Date	Buy Price	Current Price	Current % Of Portfolio	Unrealized % Return	Yield as % of Portfolio Value
Altria (MO)	Various	16.69	22.71	1.30	36.11	0.10
Philip Morris International (PM)	1/4/2005	32.19	51.98	1.98	61.47	0.11
Kraft Foods (KFT)	Various	26.33	29.10	2.22	10.53	0.11
Pfizer (PFE)	Various	24.37	15.92	1.52	(34.67)	0.07
ICICI Bank (IBN)	5/18/2006 and 08/01/2008	25.28	42.53	4.05	68.26	0.17
Advantage Energy Fund (AAV)	11/2/2006	3.85	5.86	0.56	52.21	0.10
Central Europe & Russia Fund (CEE)	Various	39.23	34.50	2.30	(12.05)	0.01
Itron Inc. (ITRI)	11/07/2007	85.01	55.91	1.07	(34.31)	None
Anthracite (ACPIQ – formerly AHR)	11/09/2007	7.97	0.01	0.00	(99.87)	0.00
iRobot (IRBT)	12/18/2007	18.65	17.92	1.37	(3.09)	None
LDK Solar (LDK)	01/22/2008	30.49	7.01	0.40	(77.01)	None
Aegon N.V. (AEG)	04/28/2008	15.99	5.51	0.32	(65.53)	0.00
Frontline Limited (FRO)	10/06/2008	36.95	28.72	1.64	(12.61)	0.06
DryShips Incorporated (DRYS)	02/09/2009	6.96	4.31	0.57	(38.11)	0.00
Plum Creek Timber (PCL)	07/23/2009	30.50	34.19	2.61	12.10	0.17
CPFL Energia S.A. (CPL)	07/28/2009	50.45	72.47	2.76	43.65	0.21
BP plc (BP)	08/05/2009	51.49	36.40	1.39	(29.31)	0.10
AT&T (T)	08/27/2009	26.38	26.45	2.02	0.25	0.13
Sysco Corporation (SYY)	10/13/2009	25.23	28.48	2.17	12.86	0.10
Exelon (EXC)	12/30/2009	49.38	40.41	2.31	(18.17)	0.21
Telefonica SA (TEF)	02/09/2010	68.74	65.65	2.50	(4.56)	0.29
Vonage Holdings (VG)	04/06/2010	1.51	2.05	0.78	35.37	0
Archer Daniels Midland (ADM)	04/23/2010	28.27	30.52	2.33	7.94	0.09
Intel Corporation (INTC)	04/23/2010	23.98	18.91	1.80	(21.14)	0.11
Google Inc. (GOOG)	05/03/2010	528.36	462	1.76	(12.56)	0
Cardinal Health (CAH)	05/06/2010	34.42	31.14	1.78	(9.53)	0.08
Pearson PLC (PSO)	05/06/2010	14.32	14.81	1.98	3.40	0.19
Nokia (NOK)	05/14/2010	10.35	9.09	1.73	(12.17)	0.17
Harris (HRS)	06/07/2010	45.65	42.76	2.44	(3.68)	0.09
Beckton Dickson (BDX)	06/23/2010	70.20	70.82	2.70	0.88	0.11
Cash				47.65
Total Portfolio					(2.43)	2.67

Below is a summary of transactions during the year:

Stock	Buy Date	Buy Price	Sell Date	Sell Price	% Gain (Loss)	% Portfolio Return*
Ameritrade (AMTD)	5/21/2008	17.69	01/19/2010	17.45	(1.33)	(0.02)
AMTD Jan 17.5 Covered Calls (TQAAW)	1/19/2010	NA	9/10/2009	NA	NA	0.22
COST Jan 60 Covered Calls (PRQAL)	1/19/2010	NA	9/10/2009	NA	NA	0.06
IBN Mar 40 Covered Calls (ITZCN)	1/22/2010	NA	10/06/2009	NA	NA	0.20
Costco (COST)	8/01/2009	62.27	02/09/2010	58.18	(6.57)	(0.08)
AAV Aug 7.5 Covered Calls	8/21/2010	NA	3/9/2010	NA	NA	0.06
Realized Gain/(Loss) YTD	-	-	-	-	-	0.40

• % Gain/Loss Relative to Portfolio Value at Beginning of Year + Deposits
• The table assumes realization of profits associated with selling options only after the option is exercised or expiry.

We have covered calls written against 40% of our ICICI Bank (IBN) shares (Sep 2010 40). We also have cash covered puts on Glaxo (GSK) shares (Jan 2011 35), Nucor Steel (NUE) shares (Jan 2011 40), Nutrisystem (NTRI) shares (Sep 2010 17.5), Emerson Electric (EMR) shares (Sep 2010 43), Automatic Data Processing (ADP) shares (Jan 2011 40), Ameritrade (AMTD) shares (Feb 2011 15), Qaigen (QGEN) shares (Nov 2010 17.5), and Costco (COST) shares (Jan 2011 55) with a cash coverage requirement of about 39% of our cash position.

We added Applied Materials (AMAT) and Cisco Systems (CSCO) to our watch list. Our current watch list follow – Applied Materials (AMAT), Air Products & Chemicals (APD), Brown-Foreman (BF-B), BHP Billiton (BHP), Caterpillar (CAT), Cresud (CRESY), Cisco Systems (CSCO), Disney (DIS), Darden’s Restaurants (DRI), AgFeed (FEED), Goldman Sachs (GS), Home Depot (HD), McDonalds (MCD), China Nepstar (NPD), NYSE Euronext (NYX), Owens & Minor (OMI), Pitney Bowes (PBI), UPS (UPS), VF Corporation (VFC), and Waste Management (WM).