Sold 3 Naked Calls on SOLO - Potential income return 1.78% in 28 days

On March 26, 2021, we sold 3 naked calls on SOLO stock expiring on April  23 2021. For this trade, we got a $42 premium (before commissions).

This trade comes as #185 in the month of March, according to our trading plan for this month, the premium generated from this trade makes us about 1.74% from our $2,000 monthly goal. While in total we have reached already 237.56% 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 SOLO APR 23 '21 6.5 Call Option 0.14 USD

what can happen next:

SOLO is trading below our strike price of $6.5 at the expiry date (April 23, 2021), in such case, we keep the premium.

In case SOLO is trading above our strike price of $6.5, we are troubled as we have to deliver 300 shares at the price of USD 6.5, to avoid that we will try to roll up and for credit. Our max gain $34.8 or 1.78% potential total income return in 28 days

Break-even: $6.61