Vertiv is in the Electrical Equipment industry and is a leader in supporting data centers and communications networks in both commercial and industrial environments. They provide products like uninterruptible power supplies, thermal management systems, and power distribution units. Their growth rate and profitability are strong and should continue consistent with the expected future growth in data centers.
As detailed below, a potential return-on-investment result is +2.7% absolute return-on-investment (equivalent to +70.2% annualized
return-on-investment for the next 14 days) if the Vertiv share price is in-the-money (i.e. above the $60.00 strike price) and therefore assigned on its April 17th, 2025 options expiration date. At this time I continue as a very cautious investor -- the majority of my investable assets are in a money market fund.
Vertiv Holdings Company (VRT) -- New Covered Calls Position
The buy/write net limit order transaction was as follows:
4/3/2025 Bought 300 Vertiv shares at $68.02.
4/3/2025 Bought 300 Vertiv shares at $68.02.
4/3/2025 Sold 3 VRT 4/17/2025 $60.00 Call options @ $9.60 per share. The Implied Volatility of the Calls was 88.4% when these Calls were sold.
A possible overall performance result (including commissions) for this Vertiv Holdings Co. Covered Calls position is as follows:
Covered Calls Net Investment: $17,528.01
= ($68.02 - $9.60) * 300 shares + $2.01 commission
Net Profit:
(a) Options Income: +$2,877.99
= ($9.60 * 300 shares) - $2.01 commission
(b) Dividend Income: +$0.00
(c) Capital Appreciation (If 300 Vertiv shares assigned at the $60.00 strike price at expiration): -$2,406.00
+($60.00 strike price - $68.02 stock purchase price) * 300 shares
Total Net Profit Potential (If 300 Vertiv shares are in-the-money and therefore assigned at the $60.00 strike price at the options expiration date): +$471.99
= (+$2,877.99 options income + $0.00 dividend income - $2,406.00 capital appreciation)
A possible overall performance result (including commissions) for this Vertiv Holdings Co. Covered Calls position is as follows:
Covered Calls Net Investment: $17,528.01
= ($68.02 - $9.60) * 300 shares + $2.01 commission
Net Profit:
(a) Options Income: +$2,877.99
= ($9.60 * 300 shares) - $2.01 commission
(b) Dividend Income: +$0.00
(c) Capital Appreciation (If 300 Vertiv shares assigned at the $60.00 strike price at expiration): -$2,406.00
+($60.00 strike price - $68.02 stock purchase price) * 300 shares
Total Net Profit Potential (If 300 Vertiv shares are in-the-money and therefore assigned at the $60.00 strike price at the options expiration date): +$471.99
= (+$2,877.99 options income + $0.00 dividend income - $2,406.00 capital appreciation)
Potential Absolute Return-on-Investment: +2.7%
= +$471.99/$17,528.01
Potential Annualized Return-on-Investment: +70.2%
= (+$471.99/$17,528.01) * (365/14 days)
