Covered Call on BCS - Potential income return 8.11% in 28 days

On August 21, 2020, we sold 1 covered call on BCS stock expiring on September 18, 2020. For this trade, we got a small $10 premium (before commissions). 

This trade comes as the #43 in the month of August, and if we stick with our trading plan for this month, the premium generated from this trade makes us about 1.01% from our $750 monthly goal, while in total we have already reached 81.25% from our monthly goal so far.

BCS stands for Barclays PLC - London headquartered multinationl bank holding company - Barclays plc is a British multinational investment bank and financial services company, headquartered in London, England. Apart from investment banking, Barclays is organised into four core businesses: personal banking, corporate banking, wealth management, and investment management

Here at we just love bank stocks, we currently are holding/trading following tickers - BAC, WFC, INGA (Amsterdam), PBCT, and now we are adding BCS. 

BCS is a dividend-paying stock (current yield is about 6% per anum) but unlike other dividend stocks - BCS is paying dividend twice per year

Here is our trade setup:

  • BOT 100 BCS Stock 5.62 USD    
  • SLD 1 BCS SEP 18 '21 6 Call Option  0.1 USD

what can happen next:

If BCS is trading below our strike price of $6 at expiry date (September 18, 2020) we keep the premium and sell more covered calls to lower our cost basis. 

In case BCS is trading above our strike price of $6, our shares get called away at strike price $6 and we realize our max gain $45.6, or 8.11% potential income in 28 days. 

Our break-even price: $5.55

Selling covered calls with BCS stock
Selling covered calls with BCS stock
  • Running Total 4 Trades since July 21, 2020
  • Options income: $25