Covered Call Position Established in Alphabet Inc.

A new short-term Covered Call net debit buy/write limit order was transacted in today's trading session in Alphabet Inc. (ticker GOOGL) for the October 23rd, 2026 expiration and at the $340.00 strike price.  The order was placed at a $335.82 limit price, so the extrinsic value (which represents the maximum profit potential for this position) was $4.18 per share [$11.71 Call option premium - ($347.53 stock purchase price - $340.00 strike price)].  The probability that this position will be in-the-money and therefore assigned on its options expiration date was 65.7% when this order was transacted.

As detailed below, the potential return-on-investment result is +1.2% absolute return-on-investment in 9 days (equivalent to a +50.4% annualized return-on-investment).  

Alphabet Inc. (GOOGL) -- New Covered Call Position

The simultaneous buy/write transaction was as follows:
10/14/2026 Bought 100 shares of Alphabet Inc. stock @ $347.53 per share.  
10/14/2026 Sold 1 Alphabet Inc. October 23rd $340.00 Call option @ $11.71 per share.
Note: The Implied Volatility of the Call option was approximately 33.0 when this transaction was executed which, as I prefer, is well above the current 17.2 of the S&P 500 Volatility Index (i.e. VIX). 

A possible overall performance result (including commissions) would be as follows:
Covered Call Cost Basis: $33,582.67
= ($347.53 - $11.71) * 100 shares + $.67 commission

Net Profit Components:
(a) Option Income: +$1,170.33
= ($11.71 * 100 shares) - $.67
(b) Dividend Income: +$0.00 
(c) Capital Appreciation (If Alphabet stock is above $340.00 strike price at the 10/23/2026 options expiration date): -$753.00
= ($340.00 strike price - $347.53 stock purchase price) * 100 shares

Total Net Profit Potential: +$417.33
= (+$1,170.33 option income + $0.00 dividend income - $753.00 capital appreciation)

Potential Absolute Return-on-Investment: +1.2%
= +$417.33/$33,582.67
Potential Equivalent Annualized Return-on-Investment: +50.4%
= (+$417.33/$33,582.67) * (365/9 days)

Closed Out Covered Calls Position in Bristol-Myers Squibb Company

Last Friday, the Covered Calls position in Bristol-Myers Squibb Company (ticker BMY) closed out-of-the-money at $59.12 which was below its $60.00 strike price.  Early in this morning's trading session, Bristol-Myers' stock price advanced above the $60.00 strike price and I decided to close out the position by selling the 200 BMY shares at $60.44 per share.

As detailed below, the return-on-investment results are: +2.8% absolute return (equivalent to +57.5% annualized return-on-investment) for the 18 days of this investment.

Bristol-Myers Squibb Company (BMY) -- Covered Calls Position Closed Out

The buy/write net limit order transaction was as follows:
9/24/2026 Bought 200 Bristol-Myers Squibb Company shares at $60.95.

9/24/2026 Sold 2 BMY 10/9/2026 $60.00 Call options @ $1.57 per share.  The Implied Volatility of these Calls was 21.6 when this position was established, which is above (as preferred) the current value of the S&P 500 Volatility Index (i.e. VIX) which was 15.7.

10/2/2026 Quarterly ex-dividend of $.63 per share.
10/9/20/2026 Two Bristol-Myers Call options closed out-of-the-money at $59.12, so the Call options expired and 200 BMY shares remained in the Covered Calls Advisor Portfolio.
10/12/2026 Closed out this Bristol-Myers Covered Calls position by selling the 200 shares at $60.44 per share.

The overall performance results (including commissions) for this Bristol Myers Covered Calls position are as follows:
Covered Calls Cost Basis: $11,877.34
= ($60.95 - $1.57) * 200 shares + $1.34 commission

Net Profit Components:
(a) Options Income: +$312.66
= ($1.57 * 200 shares) - $1.34 commission
(b) Dividend Income: +$126.00 = ($.63 dividend per share x 200 shares)

(c) Capital Appreciation (BMY shares sold at $60.44 per share on the Monday following the 10/9/2026 options expiration): -$102.00

+($60.44 stock selling price - $60.95 stock purchase price) * 200 shares

Total Net Profit: +$336.66

= (+$312.66 options income + $126.00 dividend income - $102.00 capital appreciation)

Absolute Return-on-Investment: +2.8%

= +$336.66/$11,877.34

Equivalent Annualized Return-on-Investment: +57.5%

= (+$336.66/$11,877.34) * (365/18 days)

October 9th, 2026 Options Expiration Results

The Covered Calls Advisor Portfolio had two Covered Call positions with October 9th, 2026 options expirations.  One position in NVIDIA Corporation closed with its stock price in-the-money.  So, the Call expired with no remaining time value and the Covered Call was closed out by NVIDIA stock being sold at its strike price.  A second position in Bristol-Myers Squibb Company with a $60.00 strike price closed yesterday out-of-the-money at $59.12, so the Call option expired and 100 shares now remain in the Covered Calls Advisor Portfolio.  The details for each position is as follows:

1. Nvidia Corporation (NVDA) -- +1.4% absolute return-on-investment (equivalent to +34.6% annualized return-on-investment) for the 15 days of this investment.  This NVIDIA Covered Call position had a $215.00 strike price and it closed at $229.28 yesterday.  The original blog post showing the details of this position is here. 

2. Bristol-Myers Squibb Company (BMY) -- This Covered Calls position closed yesterday at $59.12 which was below its $60.00 strike price, so the Call options expired and 200 Bristol-Myers shares remain in the Covered Calls Advisor Portfolio.  Early next week I will either continue this Covered Calls position by selling two Calls against the 200 shares owned or sell the shares to close out the position.  The original blog post detailing this position is here. 

I look forward to receiving your emails with your questions/comments at the email address shown below on any topics related to the Covered Calls investing strategy. 

Jeff Partlow
The Covered Calls Advisor
partlow@cox.net

Covered Call Position Established in AppLovin Corporation

This afternoon a new two-week Covered Call net debit buy/write limit order was established in AppLovin Corporation (ticker APP) for the October 23rd, 2026 expiration and at the $262.50 strike price.  Today's limit order was placed at a $257.40, so the extrinsic value (which represents the maximum profit potential for this position) was $5.10 per share [$19.58 Call option premium - ($276.98 stock purchase price - $262.50 strike price)].  The Implied Volatility of the Call option was 51.8% and the probability that this position will be in-the-money and therefore assigned on its options expiration date was 68.7% when this order was transacted.

AppLovin is a $94 billion market cap leading global provider of a full-stack AI/Machine Learning powered software platform for advertisers to monetize their mobile advertising applications content.  They have a self-serve ads-management dashboard that has enhanced the rate at which they add new customers which will continue to support their revenue growth and also their substantial GAAP profit margins.  Their visionary CEO is Adam Foroughi who was one of the co-founders of the company in 2012.  Their IPO was in 2021.  They employ highly educated machine learning research scientists with graduate degrees from top-rated universities.  

As detailed below, the potential return-on-investment result is +2.0% absolute return-on-investment in 14 days (equivalent to a +51.6% annualized return-on-investment).  

AppLovin Corporation (APP) -- New Covered Call Position

The simultaneous buy/write transaction was as follows:
10/9/2026 Bought 100 shares of AppLovin stock @ $276.98 per share.  
10/9/2026 Sold 1 AppLovin October 23rd $262.50 Call option @ $19.58 per share.

A possible overall performance result (including commissions) would be as follows:
Covered Call Cost Basis: $25,740.67
= ($276.98 - $19.58) * 100 shares + $.67 commission

Net Profit Components:
(a) Option Income: +$1,957.33
= ($19.58 * 100 shares) - $.67
(b) Dividend Income: +$0.00 
(c) Capital Appreciation (If AppLovin stock is above the $262.50 strike price at the 10/23/2026 options expiration date): -$1,448.00
= ($262.50 strike price - $276.98 stock purchase price) * 100 shares

Total Net Profit Potential: +$509.33
= (+$1,957.33 option income + $0.00 dividend income - $1,448.00 capital appreciation)

Potential Absolute Return-on-Investment: +2.0%
= +$509.33/$25,740.67
Potential Equivalent Annualized Return-on-Investment: +51.6%
= (+$509.33/$25,740.67) * (365/14 days)