Sold 1 Credit Spread on WFC – 1.16% potential income return in 35 days

On February 05, 2021, we sold a bull put credit spread on WFC stock with an expiry set in the next 35 days. For this trade, we get a premium of $41 (before commissions)

These trades come as the #11 and #12 in the month of February, according to our trading plan for this month, the premium generated from this trade makes us about 1.20% from our $3,000 monthly goal.  .While in total we have reached already 35.32% so far. Awesome.

Wells Fargo & Company is an American multinational financial services company with corporate headquarters in San Francisco, California, operational headquarters in Manhattan, and managerial offices throughout the United States and overseas.

Here is our trade setup:

  • BOT 1 WFC MAR 12 '21 - 31 + 29 Put Bull Spread  -0.41 USD 

For this trade, we got a premium of 36.2 USD (after commissions) or a 1.16% potential income return in 35 days (if options expire worthlessly) .

What happens next?

On expiry date March 12, 2021 WFC is trading above $31 per share -  options expire worthlessly and we keep premium - if WFC trades under $31 on the expiry date, we get assigned.

But as we already have collected a premium of $0.36 per share, our break-even price for this trade then is $31-$0.36 = $30.64

Selling credit spreads on WFC stock
Selling credit spreads on WFC stock
  • Running Total  5 Trades since June 2, 2020
  • Options income: $85