Closed Covered Calls Position in Qualcomm Inc.

At last Friday's options expiration, two September 9th, 2022 Covered Calls in Qualcomm Inc. (ticker QCOM) expired out-of-the-money with the stock price below the $134.00 strike price, so the Calls expired and the 200 shares of Qualcomm remained in the Covered Calls Advisor Portfolio.  I decided to close this position given the current bearishness in the semiconductor industry in general and for Qualcomm specifically and also since another semiconductor stock (Applied Materials) is currently also in the Covered Calls Advisor Portfolio.  So soon after this morning's market open, I closed this Qualcomm Inc. position by selling the 200 shares at a market price of $132.94 per share.    

The return-on-investment results for this Qualcomm Inc. position was: +1.0% absolute return in 20 days (equivalent to a +19.1% annualized return-on-investment).   

This Covered Calls position demonstrates the benefit of selling moderately in-the-money Covered Calls in bearish markets.  This Qualcomm stock price declined by 5.6% since its original purchase price just 20 days ago, however a satisfactory return-on-investment profit was still achieved (as detailed below).

Qualcomm Inc.(QCOM) -- Covered Calls Position Closed
The original simultaneous buy/write transactions was as follows:
08/23/2022 Bought 200 shares of Qualcomm stock @ $140.80 per share 
08/23/2022 Sold 2 Qualcomm Sept. 9th, 2022 $134.00 Call options @ $8.50 per share
08/31/2022 Ex-dividend of $150.00 ($.75 per share x 200 shares)
09/09/2022 Two QCOM Calls closed below the $134.00 strike price @ $132.05 per share, so the 2 QCOM Call options expired and 200 Qualcomm shares remained in the Covered Calls Advisor Portfolio.
09/12/2022 Closed out this Qualcomm Covered Calls position by selling 200 shares @ $132.94 early in today's trading day.

The overall performance results (including commissions) are as follows:
Covered Calls Cost Basis: $26,461.34
= ($140.80 - $8.50) * 200 shares + $1.34 commission

Net Profit Components:
(a) Options Income: +$1,698.66
= ($8.50 * 200 shares) - $1.34 commission
(b) Dividend Income: +$150.00
= $.75 dividend per share x 200 shares
(c) Capital Appreciation (Qualcomm stock sold on 9/12/2022 @ $132.94 per share): -$1,572.00
= ($132.94 - $140.80) * 200 shares

Net Profit: +$276.66
= (+$1,698.66 options income +$150.00 dividend income - $1,572.00 capital appreciation)

Absolute Return-on-Investment: +1.0%
= +$276.66/$26,461.34
Equivalent Annualized Return-on-Investment: +19.1%
= (+$276.66/$26,461.34) * (365/20 days)

Jeff Partlow (The Covered Calls Advisor)
partlow@cox.net