Covered Calls Established in Uber Technologies Inc.

At 10:01am this morning, a Covered Calls position was established by buying 300 shares of Uber Technologies Inc.(ticker symbol UBER) stock at $34.58 and simultaneously selling 3 March 4th, 2022 $32.00 Call options at $3.47 per share -- a net debit of $31.11 per share -- so the time value was $.89 per share [$3.47 Call options premium - ($34.58 stock purchase price - $32.00 strike price)]. The Implied Volatility of these Call options was very high at 61.5 when this position was established.  This elevated IV level is especially true given that the Q4 2021 earnings were reported just last week, so there is no increased Implied Volatility because of an upcoming earnings report.  Given the Covered Calls Advisor's current Overall Market Meter sentiment of Slightly Bearish, a moderately in-the-money position was established.  The Delta of these Call options was 72.5 which approximates the probability that this Covered Calls position will be in-the-money and therefore assigned on the March 4th options expiration date.  In addition, according to Reuters Research, the average current target price is $61.38 (+77.5% above today's purchase price) for the forty analysts now covering Uber. 

As detailed below, a potential outcome for this Uber Technologies investment is +2.8% absolute return-on-investment for the next 19 days (equivalent to +54.5% on an annualized return basis) if the stock closes above the $32.00 strike price on the March 4th options expiration date.

Uber Technologies Inc. (UBER) -- New Covered Calls Position

The net debit buy/write limit order was executed as follows:
2/14/2022 Bought 300 shares of Uber Technologies Inc. stock @ $34.58 per share 
2/14/2022 Sold 3 Uber March 4th, 2022 $32.00 Call options @ $3.47 per share
Note: this was a simultaneous Buy/Write transaction

A possible overall performance result (including commissions) would be as follows:
Covered Calls Cost Basis: $9,335.01
= ($34.58 - $3.47) * 300 shares + $2.01 commission

Net Profit Components:
(a) Options Income: +$1,038.99
= ($3.47 * 300 shares) - $2.01 commission
(b) Dividend Income: +$0.00
(c) Capital Appreciation (If Uber stock is above the $32.00 strike price at the March 4th expiration): -$774.00
= ($32.00 -$34.58) * 300 shares

Potential Total Net Profit (If assigned at expiration): +$264.99
= (+$1,038.99 options income +$0.00 dividend income -$774.00 capital appreciation)

Absolute Return: +2.8%
= +$264.99/$9,335.01
Equivalent Annualized Return: +54.5%
= (+$264.99/$9,335.01)*(365/19 days)

The downside 'breakeven price' at expiration is at $31.11 ($34.58 - $3.47), which is 10.0% below the current market price of $34.58.  This is good protection given the high +54.5% potential annualized ROI for this investment.