Cash-Secured Puts Position in Cigna Corporation Closed

The price of Cigna Corp. stock increased swiftly from $198.06 when these two 11/19/2021 Puts were sold only two days ago to $207.60 today when the Covered Calls Advisor decided to close out the position. More than half of the potential profit has already been achieved since the Puts were Sold-to-Open at $4.40 and were Bought-to-Close today at $1.85 per share. The Covered Calls Advisor prefers not to retain positions on the quarterly earnings reporting day and when this position was established, the post said: "The Covered Calls Advisor will be monitoring this position closely every day to determine if the position should be closed out prior to the November 4th earnings report", and today was an opportune time to do so.

As detailed below, this position achieved a +1.4% absolute return in 2 days (equivalent to a +249.4% annualized return-on-investment).  This compares to a maximum potential  of +2.4% absolute return in 38 days (equivalent to a +22.7% annualized return-on-investment) if the position had instead been assigned on the November 19th, 2021 options expiration date.  

Cigna Corp. (CI) -- Cash-Secured Puts Position Closed
10/13/2021  Sold 2 Cigna November 19th, 2021 $190.00 100% Cash-Secured Put options @ $4.40 per share.
10/15/2021 Bought-to-Close 2 CI 11/19/2021 $190.00 Put options @ $1.85

The Covered Calls Advisor does not use margin, so the detailed information on this position and the potential result detailed below reflect that this position was established using 100% cash securitization for the two Put options sold.

The overall performance result (including commissions) was as follows:
100% Cash-Secured Cost Basis: $37,121.34
= ($190.00 - $4.40) * 200 shares + $1.34 commission

Net Profit:
(a) Options Income: +$507.32
= ($4.40 - $1.85) *200 shares - $2.68 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation (Cigna 11/19/2021 $190.00 Cash-Secured Puts position closed out): +$0.00
= ($190.00 - $190.00) * 200 shares

Total Net Profit: +$507.32
= (+$507.32 options income +$0.00 dividend income +$0.00 capital appreciation)

Absolute Return-on-Investment: +1.4%
= +$507.32/$37,121.34
Annualized Return: +249.4%
= (+$507.32/$37,121.34) * (365/2 days)

The funds available from closing this position will be used to establish a new Cash-Secured Puts or Covered Calls position early next week.