Roll Forward SDC SEP 11 '20 9.5 Covered Call Option 0.16 USD (23.98% potential income in 97 days)

On August 14, 2020 we roll forward 1 covered call on SDC stock  - a position originally established on June 5, 2020 with buying 100 shares with SDC paying $8.83 per share and simultaneously sold $9.00 strike price covered call. See: Covered Call on SDC - Potential income return 6.45% in 7 days

SDC stands for SmileDirectClub - a teledentistry company listed on Nasdaq. According to Google, it has a market capitalization of some 2.9 bln. Impressive.

This trade comes as the #33 in the month of August, and if we stick with our trading plan for this month, the premium generated from this trade makes us about 1.81% from our $750 monthly goal, while in total we have already reached 65.52% from our monthly goal so far.

Since establishing this position back in June 2020 we have sold (roll forwarded) 3 additional covered calls with this stock:

here is our trade setup:

  • SLD 1 SDC SEP 11 '20 9.5 Call Option 0.16 USD

what can happen next:

SDC is trading below our strike price of $9.5 at the expiry date (September 11, 2020), in such a 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 $9.5, our 100 shares get called away at the strike price of $9.5 and we realize our max gain $211.80, or 23.98% potential income in 97 days

Break-even: $7.29

Selling covered calls and puts with SDC stock
Selling covered calls and puts with SDC stock

  • Running Total: 21 Trades since April 27, 2020
  • Options Income: $486