As detailed below, the return-on-investment results for this EOG Resources Inc. Covered Calls position was +2.0% absolute
return in 12 days (equivalent to a +62.1% annualized
return-on-investment).
EOG Resources Inc. (EOG) -- Covered Calls Position Closed
The original buy/write transaction was as follows:
12/02/2021 Bought 200 EOG Resources Inc. shares @ $84.9553
12/02/2021 Sold 2 EOG 12/23/2021 $80.00 Call options @ $7.06 per share. The Implied Volatility of these Call options was 48.7 when this position was established and their Bid/Ask spread was $6.80/$7.40.
12/14/2021 Special ex-dividend of $2.00 per share
12/14/2021 Unwound EOG Covered Calls position: Sold-to-Close 200 EOG shares @ $85.83 and Bought-to-Close 2 Dec. 23rd, 2021 $78.00 Call options @ $8.33 per share.
The overall performance results (including commissions) for this EOG Resources Covered Calls position are as follows:
Covered Calls Cost Basis: $15,580.40
= ($84.9553 - $7.06) * 200 shares + $1.34 commissions
Net Profit Components:
(a) Options Income: -$256.68
= ($7.06 -$8.33) * 200 shares - $2.68 commissions
(b) Dividend Income: (Special Dividend of $2.00 per share): +$400.00
= ($2.00 dividend per share x 200 shares)
(c) Capital Appreciation (Sold-to-Close 200 EOG shares assigned at $85.83): +$174.94
+($85.83 - $84.9553) * 200 shares
