Established Covered Calls Position in Capital One Financial Corporation

At 2:00pm this afternoon, I established a Covered Calls position in Capital One Financial Corporation (ticker COF). Capital One is a diversified financial services company headquartered in McLean, Virginia. Its three segments are Credit Cards, Consumer Banking, and Commercial Banking. Their acquisition of Discover Financial earlier this year is widely regarded as a valuable addition to their credit card business (which provides the majority of Capital One's total revenue). 

Regarding the Covered Calls transaction: My net debit buy/write limit order was executed when 200 shares were purchased at $217.40 and 2 November 21st, 2025 Call options were sold at $7.00 at the $212.50 strike price.  This is a short-term position since their are only 8 calendar days remaining until next Friday's options expiration date. The corresponding extrinsic value (i.e. time value) is $2.10 per share [$7.00 Call options premium - ($217.40 stock purchase price - $212.50 strike price)], all of which will be profit if the stock is in-the-money on the November 21st options expiration date. The Implied Volatility of the Call options was 33.3 which, as desired by the Covered Calls Advisor, is above the current 17.1 of the S&P 500 Volatility Index (i.e. VIX).  The probability that these Calls will expire in-the-money on the options expiration date was 66.9% when this position was transacted.  Also as preferred, the next earnings report on January 20th, 2026 is well after the options expiration date.

Capital One goes ex-dividend at $.80 per share next Monday which is included in the return-on-investment calculations detailed below. This $.80 per share dividend provides a 1.5% annualized dividend yield and is 33.3% higher than for the same quarter last year.  So, this short-term (only 8 days until options expiration) position is established to take advantage of the potential to achieve an excellent potential annualized return-on-investment for this in-the-money Covered Calls position.  As detailed below, the potential return-on-investment results for this position if the Calls expire in-the-money (i.e. above the $212.50 strike price) on the 11/18/2025 options expiration date is +1.3% absolute return-on-investment, which is equivalent to +60.7% annualized return-on-investment for the 8 days of this position.  

Capital One Financial Corporation (COF) -- New Covered Calls Position

The buy/write transaction was:
11/13/2025 Bought 200 Capital One Financial shares @ $217.40
11/13/2025 Sold 2 Capital One 11/21/2025 $212.50 Call options @ $7.00
11/17/2025 Upcoming quarterly ex-dividend of $.80 per share

A possible overall performance result (including commissions) for this Capital One Covered Calls position is as follows:
Covered Calls Net Investment: $43,481.34
= ($217.40 - $7.00) * 200 shares + $1.34 commission

Net Profit Components:
(a) Options Income: +$1,398.66
= ($7.00 * 200 shares) - $1.34 commission
(b) Dividend Income (If Capital One stock assigned at the November 21st, 2025 options expiration; so the $.80 dividend is captured): +$160.00
= ($.80 dividend per share x 200 shares)

(c) Capital Appreciation (If Capital One Call options assigned on the Nov. 21st, 2025 options expiration date): -$980.00
+($212.50 strike price - $217.40 stock purchase price) * 200 shares

Total Net Profit (If Capital One shares assigned at $212.50 at the 11/21/2025 expiration): +$578.66

= (+$1,398.66 options income + $160.00 dividend income - $980.00 capital appreciation)

Absolute Return-on-Investment (If Capital One shares assigned at $212.50 at the 11/21/2025 options expiration): +1.3%

= +$578.66/$43,481.34

Annualized Return-on-Investment (If Capital One shares assigned at $212.50 at the 11/21/2025 options expiration date): +60.7%

= (+$578.66/$43,481.34) * (365/8 days)