Credit Spread on PFE – 0.44% potential income return in 24 days

On November 24, 2020, we sold a bull put credit spread on PFE stock with an expiry set in the next 24 days. For this trade, we get a premium of $20 (before commissions)

These trades come as the #34 and #35 in the month of November, according to our trading plan for this month, the premium generated from this trade makes us about 3.37% from our $450 monthly goal, while in total we have already reached 242% so far.

Here is our trade setup:

  • BOT 1 PFE DEC 18 '20 - 34.5 + 33.5 Put Bull Spread  -0.2 USD 

For this trade, we got a premium of 15.2 USD (after commissions) or a 0.44% potential income return in 24 days.

What happens next?

On expiry date December 18, 2020 PFE is trading above $34.5 per share -  options expire worthlessly and we keep premium - if PFE trades under $34.5 on the expiry date, we get assigned.

But as we already have collected a premium of $0.15 per share, our break-even price for this trade then is $34.5-0.15 = $34.35

Selling credit spreads with Pfe stock
Selling credit spreads with Pfe stock
  • Running Total  3 Tradeq since November 18, 2020
  • Options income $72