Sold 3 Naked Calls on SDC - Potential income return 0.74% in 4 days

On March 08, 2021, we sold 3 naked calls on SDC stock expiring on March 12, 2021. For this trade, we got a $33 premium (before commissions).

This trade comes as #59 in the month of March, according to our trading plan for this month, the premium generated from this trade makes us about 1.29% from our $2,000 monthly goal. While in total we have reached already 89.15% so far. Awesome.

We prefer selling covered calls over naked, but this time we decided to take the risk, as it offered to free up some margin.

here is our trade setup:

  • SLD 3 SDC MAR 12 '21 11.5 Call Option 0.11 USD

what can happen next:

SDC is trading below our strike price of $11.5 at the expiry date (March 12, 2021), in such case, we keep the premium.

In case SDC is trading above our strike price of $11.5, we are troubled as we have to deliver 300 shares at the price of USD 11.5, to avoid that we will try to roll up and for credit. Our max gain $25.8 or 0.74% potential total income return in 4 days

Break-even: $11.58