Continuation of Covered Calls Positions in U.S. Steel Corp.

At the June 15th, 2018 options expiration, the Covered Calls position in United States Steel Corp. (ticker X) expired with the stock price below the strike price.  So, the Call options expired and the stock shares were retained in the Covered Calls Advisor's Portfolio.  The Covered Calls Advisor continued this Covered Calls positions by selling the July 20th, 2018 $37.50 Call options against the current long stock position in U.S. Steel. 

Detail transactions as well as some potential overall return-on-investment results for this position are:


United States Steel Corp. (X) -- Continuation of Covered Calls Position

The transactions were:
02/01/2018 Bought 400 shares of U.S. Steel stock @ $36.72 per share 
02/01/2018 Sold 4 U.S. Steel Mar 16th, 2018 $36.00 Call options @ $2.62 per share
Note: this was a simultaneous Buy/Write transaction
02/08/2018 $20.00 = ($.05 per share ex-dividend x 400 shares)
03/13/2018 Bought-to-Close 4 Mar 16th $36.00 Call options @ $5.99
03/13/2018 Sold-to-Open 4 Apr 20th $40.00 Call options @ $3.57
Note: this Calls debit spread transaction occurred when the stock was at $41.88
04/20/2018 4 U.S. Steel April 20th Call options expired
05/09/2018 $20.00 = ($.05 per share ex-dividend x 400 shares)
05/10/2018 Sold 4 U.S. Steel June 15th, 2018 $40.00 Call options @ $.66 per share
Note: the price of U.S. Steel stock was $36.04 when these Calls were sold
06/15/2018 4 X Call options expired with stock price below strike price
06/22/2018 Sold 4 U.S. Steel July 20, 2018 $37.50 Call options @ $1.35 to continue U.S. Steel Covered Calls position
Note: the price of U.S. Steel stock was $36.79 when these Calls were sold

Two possible overall performance results (including commissions) would be as follows:
Covered Calls Cost Basis: $13,647.63
= ($36.72 - $2.62)* 400 shares + $7.63 commission

Net Profit Components:
(a) Options Income: +$861.11
= ($2.62 - $5.99 + $3.57 + $.66 + $1.35) * 400 shares - $22.89 commissions 
(b) Dividend Income: +$40.00
= $.05 per share * 2 ex-dividends * 400 shares 
(c) Capital Appreciation (If price of X stock is unchanged at $36.79 at July 20th expiration): +$23.05
= ($36.79 -$36.72)* 400 shares - $4.95 commission; OR
(c) Capital Appreciation (If X is above $37.50 strike price at July 20th expiration):
+$307.05
= ($37.50 -$36.72)* 400 shares - $4.95 commission

1. Potential Total Net Profit (If stock price unchanged at expiration): +$924.16
= (+$861.11 options income +$40.00 dividend income +$23.05 capital appreciation); OR
2. Potential Total Net Profit (If assigned at expiration): +$1,208.16
= (+$861.11 options income +$40.00 dividend income +$307.05 capital appreciation)

1. Absolute Return (If stock price unchanged at expiration): +6.8%
= +$924.16/$13,647.63
Equivalent Annualized Return: +14.6%
= (+$924.16/$13,647.63)*(365/169 days); OR
2. Absolute Return (If assigned at expiration): +8.9%
= +$1,208.16/$13,647.63
Equivalent Annualized Return: +19.1%
= (+$1,208.16/$13,647.63)*(365/169 days)