Roll Forward and Down 4 Covered Calls on SmileDirectClub (NASDAQ:SDC) - Potential income return 7.16% in 89 days

On March 08, 2021, we roll forwarded and rolled down 4 covered calls on NASDAQ:SDC  stock, expiring March 26, 2021. For this trade, we got a $100 premium (before commissions)

This trade comes as #57 in the month of March, according to our trading plan for this month, the premium generated from this trade makes us about 4.52% from our $2,000 monthly goal. While in total we have reached already 89.96% so far. Awesome.

This trade was originally established back on January 8, 2021, just shortly after we got assigned 400 shares at $13 each, see: Sold 4 Credit Spreads on SDC – 1.93% potential income return in 15 days

here is our trade setup:

  • SLD 4 SDC MAR 26 '21 12.5 Call Option 0.25 USD

what can happen next:

SDC is trading below our strike price of $12.5 at the expiry date (March 26, 2021), in such case, we keep the premium and sell more covered calls to lower our cost basis. 

In case SDC is trading above our strike price of $2.5, our 400 shares get called away at the strike price of $12.5 , and (as we have already collected some premium from selling puts and calls in the past) we realize our max gain $372.6 or 7.16% potential return of income in 89 days

Break-even: $11.6

Selling covered calls with SDC stock
Selling covered calls with SDC stock
  • Running Total 72 Trades since April 27, 2020

  • Options income: $1,883