Covered Call on NRZ - Potential income return 16.28% in 88 days

On August 24, 2020, we sold 1 covered call on NRZ stock expiring on November 20, 2020. For this trade, we got a $28 premium (before commissions).

This trade comes as the #47 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 3.41% from our $750 monthly goal, while in total we have already reached 107.73% from our monthly goal so far.

here is our trade setup:

  • BOT 100 NRZ Stock 7.96 USD
  • SLD 1 NRZ NOV 20 '20 9 Call Option 0.28 USD

what can happen next:

NRZ is trading below our strike price of $9 at the expiry date (November 20, 2020), in such a case, we keep the premium and sell more covered calls to lower our cost basis. 

In case NRZ is trading above our strike price of $9, our 100 shares get called away at the strike price of $9 and we realize our max gain $129.6 (900-796+25.6 ) or 16.28% potential income in 88 days

Break-even: $7.71

Selling covered calls with NRZ stock
Selling covered calls with NRZ stock
  • Running Total  14 Trades since April 9, 2020
  • Options income: $303