Sold 1 Credit Spread on PFE – 1.68% potential income return in 31 days

On February 02, 2020, we sold a bull put credit spread on PFE stock with an expiry set in the next 31 days. For this trade, we get a premium of $63 (before commissions)

These trades come as the #3 and #4 in the month of February, according to our trading plan for this month, the premium generated from this trade makes us about 1.94% from our $3,000 monthly goal.  .While in total we have reached already 14.36% so far. Awesome.

Here is our trade setup:

  • BOT 1 PFE MAR 05 '21 - 34.5 + 32.5 Put Bull Spread  -0.63 USD 

For this trade, we got a premium of 58.2 USD (after commissions) or a 1.68% potential income return in 31 days.

What happens next?

On expiry date March 05, 2021 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 $0.58 per share, our break-even price for this trade then is $34.5-$0.58 = $33.92

Selling credit spreads with PFE stock
Selling credit spreads with PFE stock
  • Running Total  10 Trades since November 18, 2020
  • Options income $242