Covered Call on T - Potential income return 3.62% in 49 days

On January 8, 2021, we sold covered call on NYSE:T  stock expiring on January 29, 2021. For this trade, we got a $33 premium (before commissions)

This trade comes as the #9 in the month of January, according to our trading plan for this month, the premium generated from this trade makes us about 1.22% from our $2,500 monthly goal. While in total we have reached already 16.34% so far. Awesome.

We sold this covered call just shortly after we got assigned 100 shares at $29.5 each, see: Credit Spread on AT&T (NYSE:T) – 0.88% potential income return in 28 days / 11.44% annualized

here is our trade setup:

  • SLD 1 T JAN 29 '21 30 Call Option 0.33 USD

what can happen next:

T is trading below our strike price of $30  at the expiry date (January 29, 2021), in such case, we keep the premium and sell more covered calls to lower our cost basis. 

In case T is trading above our strike price of $30, our 100 shares get called away at the strike price of $30 and (as we have already collected some premium from selling puts in the past) we realize our max gain $106.8 or 3.62% potential return of income in 49 days

Break-even: $28.94

Selling covered calls with T stock
Selling covered calls with T stock

 

  • Running Total  8 Trades since October 20, 2020
  • Options Income: $82