Credit Spread on AMWL – 3.26% potential income return in 29 days / 41.01% annualized

On November 19, 2020, we sold a bull put credit spread on AMWL stock with an expiry set in the next 29 days. For this trade, we get a premium of $70 (before commissions)

These trades come as the #19 and #20 in the month of November, according to our trading plan for this month, the premium generated from this trade makes us about 14.48% from our $450 monthly goal, while in total we have already reached 91.62% so far.

Amwell, formerly known as American Well, is a telemedicine company based in Boston, Massachusetts, that connects patients with doctors over secure video.

With this trade, we are dipping our toes into another telemedicine stock, after SDC. While placing this trade we feel thrilled, but let's see how it will end.

Here is our trade setup:

  • BOT 1 AMWL DEC 18 '20 - 20 + 17.5 Put Bull Spread  -0.70 USD 

For this trade, we got a premium of 65.2 USD (after commissions) or a 3.26% potential income return in 29 days.

What happens next?

On expiry date December 18, 2020 AMWL is trading above $20 per share -  options expire worthlessly and we keep premium - if AMWL trades under $20 on the expiry date, we get assigned.

But as we already have collected a premium of $0.65 per share, our break-even price for this trade then is $20-0.65 = $19.35

Selling credit spreads with AMWL stock
Selling credit spreads with AMWL stock
  • Running Total  2 Trades since November 19, 2020
  • Options income $65