Today, a new covered calls position was established in Exxon Mobil Corporation (ticker symbol XOM) with an Aug2015 expiration. The Exxon Mobil stock was purchased at $78.96 after today's disappointing earnings release when the stock price had declined by almost 5% from yesterday's closing price. The Aug2015 Call options were simultaneously (i.e. a single buy-write transaction was made) sold at the $78.00 strike price for $1.80 each.
This covered calls investment is a strategic one that explicitly considers the upcoming quarterly dividend with an ex-dividend date (Aug 11th) prior to the August 21st options expiration date. Details of this position is provided below.
1. Exxon Mobil Corp. (XOM)
As shown below, two potential return-on-investment results for this position are: