Roll Forward and Roll Up Covered Call on SmileDirectClub (NASDAQ:SDC) - Potential income return 13.16% in 30 days (160.02% annualized)

On November 13, 2020, we sold roll forward and roll up a covered call on SmileDirectClub (NASDAQ:SDC)  stock expiring on November 20, 2020. For this trade, we got a $37 premium (before commissions).

here is our trade setup:

  • SLD 1 SDC NOV 20 '20 11 Call Option 0.37 USD

We rolled up our strike price from 10.5 to 11. In case our call will get assigned we will earn additional +$50

This trade comes as the #13 in the month of November, according to our trading plan for this month, the premium generated from this trade makes us about 7.68% from our $450 monthly goal, while in total we have already reached 41.08% so far.

what can happen next:

SDC is trading below our strike price of $11 at the expiry date (November 20, 2020), 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 $11, our 100 shares get called away at the strike price of $11, and (as we have already collected some premium from selling puts in the past) we realize our max gain $138.2 or 13.16% potential return of income in 30 days

Break-even: $9.63

Selling covered calls with SDC stock
Selling covered calls with SDC stock
  • Running Total  30 Trades since April 27, 2020
  • Options income $621