Covered Calls Established in Tyson Foods Inc.

Early in this morning's trading, my buy/write Covered Calls position was transacted in Tyson Foods Inc. (ticker TSN) at a net debit limit order price of $61.76 per share.  Three hundred shares were purchased at $63.24 and three December 20th, 2024 Call options were sold at the $62.50 strike price at $1.48 per share.  This provides a time value profit potential of $.74 per share [$1.43 Call options premium - ($63.24 stock purchase price - $62.50 strike price)].  There was a 61.7% probability of the stock closing in-the-money on the options expiration date when this position was established.  

This position uses the Covered Calls Advisor's Dividend Capture Strategy (see here).   Tyson Foods has an upcoming quarterly ex-dividend of $.50 per share (a 3.2% annual dividend yield) that goes ex-dividend on November 29th, 2024 (which is prior to the Dec. 20th options expiration date).  This dividend is included in the detailed potential return-on-investment calculations below.  Also as preferred, the next quarterly earnings report on February 3rd, 2025 is after the December 20th, 2024 options expiration date.  

As detailed below, a potential return-on-investment result is:  +2.0% absolute return (equivalent to +30.4% annualized return-on-investment over the next 24 days) if the stock is assigned on the December 20th, 2024 options expiration date.

Tyson Foods Inc. (TSN) -- New Covered Calls Position 

The Buy/Write transaction was as follows:
11/26/2024 Bought 300 shares of Tyson Foods @ $63.24 per share.  
11/26/2024 Sold 3 TSN December 20th, 2024 $62.50 Call options @ $1.48 per share.  The Implied Volatility of these Call options was 15.3 today when this transaction was executed. 

A possible overall performance result (including commissions) if this stock is in-the-money (and therefore the stock is assigned (i.e. sold) at the $62.50 strike price) on the Dec. 20th options expiration date is as follows:
Covered Calls Net Investment: $18,530.01
= ($63.24 - $1.48) * 300 shares + $2.01 commission

Net Profit:
(a) Options Income: +$441.99
= ($1.48 * 300 shares) - $2.01 commission
(b) Dividend Income (If assigned on the 12/20/2024 options expiration date): +$150.00
= $.50 x 300 shares
(c) Capital Appreciation (If 300 Tyson Foods shares assigned at the $62.50 strike price): -$222.00
+($62.50 strike price - $63.24 stock purchase price) * 300 shares

Total Net Profit Potential (If 300 Tyson Foods Inc. shares assigned at the $62.50 strike price at the options expiration date): +$369.99
= (+$441.99 options income +$150.00 dividend income - $222.00 capital appreciation)

Potential Absolute Return-on-Investment: +2.0%
= +$369.99/$18,530.01
Potential Annualized Return-on-Investment (if assigned on the 12/20/2024 options expiration date): +30.4%
= (+$369.99/$18,530.01) * (365/24 days)